Here's a 9-step guide to calculating your credit card interest - We Are The Mighty
MIGHTY MONEY

Here’s a 9-step guide to calculating your credit card interest

When it comes to credit cards, understanding your interest rate and how it works can be the difference between staying out of debt with an excellent credit score and falling behind in your payments and dipping to sub-par credit score ratings.

Your interest rate is the amount your credit card charges you to borrow money. If you pay your credit card balance in full and on time, you generally don’t need to worry much about your interest rate, which is expressed as an annual percentage rate (APR).

But if you’re carrying a balance on your credit card, you’ll notice you owe more over time, and that’s because of the interest rate. Credit cards are notorious for being one of the most expensive types of consumer debt, with an average interest rate of about 17%.


While in most cases you probably don’t need to calculate your credit card card interest rate — your statements should clearly reflect how much interest is owed on any unpaid balance and your APR should be clear on your statement and your bank’s website — you may want to get an idea of how much your balance is costing you on a day-to-day basis.

Here’s a 9-step guide to calculating your credit card interest

Here’s a quick cheat sheet to help you when it comes to calculating your own credit card interest rate.

1. Pull up your credit card information

Log on to your financial institution’s website or pull out your latest statement (if you haven’t switched to paperless billing yet, get on that!) to find the pertinent information you’ll need to calculate your credit card interest.

You’ll need to find:

  • your purchase APR
  • the number of days in your billing cycle

2. Get to know the terms

The way your credit card works boils down to a few different terms, two of which include annual percentage rate (APR) and, more generally, your interest rate.

Although APR stands for annual percentage rate, your credit card company uses this percentage number to determine the interest you’ll be charged each month when you don’t pay your credit card off in full and carry a balance.

Keep in mind that your credit card may have different types of APR, like a:

  • purchase APR (usually applied to the overall purchases you make with a card),
  • balance transfer APR (usually applied to any balances transferred from another credit card)
  • introductory APR (usually applied to purchases made during the promotional period after opening a new credit card)

3. Find your purchase APR

In order to calculate the interest you owe on any leftover balances on your credit card, you’ll need to find your purchase APR. If you can’t find this information readily, try calling your bank, or click on your card’s terms and conditions section.

Here’s a 9-step guide to calculating your credit card interest

4. Determine your average daily balance (or balance subject to interest)

This is the aggregate total of what you spent and either paid off and/or were refunded every day throughout your billing cycle, divided by the number of days in your billing cycle.

If you’ve always paid your purchases in full by the due date, you won’t have any interest payments to make and your average daily balance isn’t really a factor. However, if you plan to carry a balance, to calculate your average daily balance when you need to determine interest, log onto your bank account online and track the charges and credits that went through on each individual day, creating a rolling total as you move through the days of your billing cycle.

This will provide you with an aggregate total that you can then divide by the number of days in your billing cycle (which you’ll find in step five).

5. Get the number of days in your billing cycle

Different credit cards have different amounts of time between billing cycles. A typical credit card statement is paid out in 30-day billing cycles.

6. Divide your APR by 365

Since your APR is your annual interest rate, you’ll need to divide your APR by the number of days in the year to get your daily interest rate. So for example, an APR of 13.99% would become: 0.1399/365 = .00038 daily interest.

7. Multiply your daily rate by your average daily balance

Once you know what you’re charged daily for interest, you can multiply that number by your average daily balance to find the daily interest you’ll owe. So for example, if your leftover balance after paying your credit card is id=”listicle-2639175991″,000, you would get: .00038 x id=”listicle-2639175991″,000 = .38.

Here’s a 9-step guide to calculating your credit card interest

8. Multiply your daily interest rate by the number of days in your billing cycle

If you determined that you have a 30-day billing cycle, then the credit card interest you would owe on a balance for the 30-day cycle in this example would be: .38 x 30 days = .50 in interest.

9. Ask about your credit card’s grace period allowance

Some credit cards offer a grace period between when items are purchased and when they absolutely need to be paid off before accruing interest. Check in with your bank to learn if you have a grace period on your accounts and what the exact grace period is in order to better avoid paying interest.

Also read:

This article originally appeared on Business Insider. Follow @BusinessInsider on Twitter.

MIGHTY MONEY

4 basic things you should be doing with your money

Millennials as a group may be delusional about the future, but some are making good decisions with their money today.

Generally, many millennials have little to no credit-card debt, put a portion of their income toward retirement, and have a savings account, an INSIDER and Morning Consult survey found.

Of the 4,400 Americans polled, 1,207 identified as millennials, defined as ages 22 to 37 (237 respondents did not select a generation). The margin of error was plus or minus 1 percentage point.

Here are a few of the ways millennials are smart with their money, according to responses to our survey:


1. They have a savings account.

About 69% of millennials said they had a savings account, compared with 65% of Gen Xers, the survey found.

But while the existence of a savings account is inherently positive, it’s nothing without consistent contributions. A whopping 58% of millennials said they had under ,000 in a savings account, about 19% had between ,000 and ,000, and 11% had between ,000 and ,000.

Here’s a 9-step guide to calculating your credit card interest

(Photo by Sharon McCutcheon)

Many financial planners recommend a high-yield savings account over a traditional savings account for an emergency fund or other short-term need. The best high-yield online savings accounts are offering an annual percentage yield between 2% and 2.5%, and many have no fees and low minimum deposits.

2. They have little to no credit-card debt

Millennials seem to know that keeping a balance on their credit cards isn’t going to make for a good credit score. About 32% said they had no credit-card debt at all — a greater share than Gen Xers (28%). Of the millennials who do have debt, a plurality (36%) said they had under ,000.

It might make sense that Gen Xers, who are older and presumably have more expenses, would be more likely to have credit-card debt, but in this survey the oldest millennials were 37 — and people’s 30s tend to come with houses, kids, pets, and expenses that are no longer limited to Gen X.

Two smart strategies to pay off credit-card debt, according to financial planners, are the “debt snowball,” which prioritizes paying off the smallest debts first, and the “debt avalanche,” which prioritizes paying off the highest-interest debt first. Either method is effective, so the best approach may be to pick the one you can commit to.

3. They would use a id=”listicle-2634449531″,000 windfall to pay off debt or save.

Given an extra id=”listicle-2634449531″,000 cash, 27% of millennials (a plurality) said they would choose to pay off debt, while 22% said they would save the windfall, the survey found. Only 6% said they would put it toward travel or shopping.

Here’s a 9-step guide to calculating your credit card interest

(Photo by Artem Bali)

This is good instinct, as financial planners typically suggest stamping out debt with high interest rates first and foremost, even before saving for retirement or another financial goal. Carrying a balance on a credit card can erode your credit score, and fees and high interest rates can continually add to the overall debt load.

In the survey, the millennials who indicated they wouldn’t use the windfall to pay off debt or save said it would go toward outstanding bills (17%), necessities (12%), or an investment (9%).

4. They put more of their income toward retirement than Gen Xers.

Even though 52% of millennials said they didn’t have a retirement savings account, the ones who do are serious savers.

In the survey, nearly 16% of millennials said they set aside 11% to 20% of their income for retirement — more than any other generation. About 5% of millennials, the same share as Gen X, said they save more than 20% of their income for retirement.

A plurality (33%) said they put away between 1% and 10% of their income for retirement, which is a fine place to start. Experts recommend increasing savings rates annually or every time you get a raise.

One of the easiest ways to build wealth is through automatic and consistent contributions, starting with a retirement account. The contributions to a 401(k) or IRA are pretax, so the money will be taken out of your paycheck before it even hits your bank account. Many employers will match contributions up to a certain percentage or dollar amount. It’s basically free money, but you won’t get any of it unless you’re already contributing something on your own.

This article originally appeared on Business Insider. Follow @BusinessInsider on Twitter.

MIGHTY MONEY

Army reports lack of training as biggest setback to readiness

Earlier this month, the Army’s top general in charge of supplying units with troops blamed a lack of readiness on limited time for training, adding that lack of funding isn’t the biggest challenge.


Head of Army Forces Command Gen. Robert Abrams said the lack of training stems from lawmakers making policy that commits the service to engagements around the world without an eye toward keeping the force healthy and trained up.

Here’s a 9-step guide to calculating your credit card interest
U.S. Soldiers of Rider Company, 2nd Battalion, 7th Infantry Regiment, 1st Armored Brigade record information while conducting a brief during exercise Combined Resolve VII at the U.S. Army’s Joint Multinational Readiness Center in Hohenfels Germany, Sept. 11, 2016. The exercise is designed to train the Army’s regionally allocated forces to the U.S. European Command. Combined Resolve VII includes more than 3,500 participants from 16 NATO and European partner nations. (U.S. Army photo by Pfc. Caleb Foreman)

Abrams explained that soldiers were expected to deploy more and have less time home because of downsizing.

“Our goal has always been … one month gone, two months back,” Abrams said, adding that the Army is currently experiencing a ratio of “deploy-to-dwell” that trends closer to one month gone, one month back.

“Our commitments worldwide across the globe in support of our combatant commanders remains at a very high level while we continue to simultaneously downsize the total force,” Abrams told an audience at the annual Association of the U.S. Army conference in Washington.

“Our number one constraint for training is time available.”

Recent budget cuts have forced the Army to reduce its total active duty soldiers to 450,000 while still meeting its obligations worldwide. As a result, the operational tempo for soldiers is higher and more demanding — ultimately requiring soldiers to train more, for longer periods of time, in addition to more and longer deployments, Army officials say.

“The impact of non-standard missions continues to have a degrading effect across our force in being able to sustain proficiency in combined arms maneuver,” Abrams said.

Because soldiers are experiencing a minimal deploy-to-dwell time, there isn’t enough time for soldiers to maintain the training the Army requires.

“We struggle today to maintain and meet Department of the Army standards in our critical combat fleets,” Abrams explained before highlighting unmet requirements within the Army’s aviation and ground fleets. He was quick to explain that in aviation in particular, the problems do not lie with the aviators. The problem stems, instead, with plans to restructure the way the Army finances those fleets, impacting training requirements, upkeep on aircraft, and overall readiness of aviators.

While Abrams was very careful not to blame funding shortfalls for the readiness issues facing the Army, he did not hesitate to blame the readiness of the National Guard in particular on lack of money.

“We’ve dug ourselves this hole because of funding,” Abrams said.

Despite the tough times, Abrams said the Army has made tremendous strides in the last year in terms of readiness and overall capabilities.

“Last year at this exact forum, one of underlying themes was that as an army in terms of our joint war-fighting capabilities, we were pretty rusty,” he said. “I’m happy to report today that we have made progress in our ability.”

MIGHTY MONEY

Gary Johnson speaks out on California Guard repayment scandal

Here’s a 9-step guide to calculating your credit card interest
Maj. Gen. William H. Wade, the adjutant general for the California National Guard administers the oath of enlistment to Soldiers of Bravo Battery, 1st Battalion, 143rd Field Artillery during a recent visit Victory Base Complex, Iraq in 2007.


Libertarian presidential candidate Gary Johnson had strong words for the National Guard and the Pentagon after allegations emerged that the DoD is forcing California Guard troops to reimburse the government for enlistment bonuses it paid in error.

“It is beyond the bounds of decency to go after our veterans and their families a decade later,” he said in a statement obtained by We Are the Mighty. “These are rounding errors to the Pentagon, but these demands for repayment are ruining lives and causing severe hardships for service members whose sacrifices for the nation can frankly never be adequately be repaid.”

Johnson was referring to a Los Angeles Times story that alleges the National Guard is forcing nearly 10,000 guardsmen from California to repay reenlistment bonuses they were awarded 10 years ago.

According to the paper, more than 14,000 California Guardsmen were awarded the reenlistment bonuses as a result of the Army’s incentive program to retain soldiers during the height of the Iraq war.

The U.S. government investigated the California Guard reenlistment bonuses and found a majority of the requests had been approved despite the soldiers’ not qualifying for the bonus. There has been no suggestion that any of the Guardsmen who received the reenlistment bonuses were aware that they did not qualify for them.

The Los Angeles Times reports that Army Master Sgt. Toni Jaffe was the California Guard’s incentive manager at the time, and that after the Pentagon discovered the overpayments 6 years ago, Jaffe pleaded guilty to fraud. She was sentenced to 30 months in federal prison. Three other officers associated with the fraud also pled guilty, receiving probation after being forced to pay restitution.

Major Gen. Matthew Beevers, the deputy commander of the California Guard, accused the nearly 10,000 soldiers of owing a debt to the Army.

In his statement to The Los Angeles Times, Beevers claimed that the soldiers were at fault and that the Guard couldn’t forgive them. “We just can’t do it. We’d be breaking the law,” he said, not addressing whether the Guard was breaking the law by reneging on the contracts.

Several of the Guardsmen went on to deploy to Iraq and Afghanistan, many of whom sustained injuries as a result.

Military Times reports that the Pentagon is searching for ways to overcome the issue. “This has the attention of our leadership, and we are looking at this to see what we can do to assist,” Pentagon spokesman Captain Jeff Davis said Monday.

A host of lawmakers have stepped forward to condemn the Pentagon for harassing the Guardsmen who received the reenlistment bonuses, calling for congressional investigations into the matter. Though as of publication, no presidential candidate other than Johnson had addressed it.

Calling on President Obama and Congress to act immediately on the impacted Guardsmen, Johnson said, “The Pentagon needs a good dose of common sense far more than it needs these dollars, and making our service members pay for the government’s incompetence is beyond the pale.”

Here’s a 9-step guide to calculating your credit card interest
In a statement obtained by We Are the Mighty, Governor Johnson called for immediate action to be taken to keep the faith with California National Guardsmen.

Articles

Here’s when vets should NOT buy franchises

Here’s a 9-step guide to calculating your credit card interest


“Worry about the dollars and the pennies take care of themselves.” — anonymous

It’s worthwhile to keep that adage above in mind when you are being pitched to buy a franchise business.

One of the most costly mistakes veterans can make is paying too much upfront for a franchise that you can’t sell for the same price the next day.  It’s the venture equivalent of buying a used Chevy for the price of new BMW.

I hate it when I receive letters from veterans who “want out” of a franchise they just bought.  They feel snookered, trapped, and annoyed at themselves for not looking at the details before signing on the dotted line.

The best way to avoid buyer’s remorse is to become a smart shopper of franchise opportunities.  Here are five tips to help you assess if you are more likely to make money or lose money in the franchise world.

1. Set higher standards

If your objective is to merely “go into business for yourself” or “own a franchise” then your aspirations are not high enough to be a successful business owner.  After all, you will achieve your goal of business ownership the day you sign the franchise contract!  Then what?

A more purposeful objective is to own a franchise that will make money for you.  When you set high standards for your financial return on your invested time and savings your tire-kicking “due diligence” questions become more precise and purposeful.

2. Understand sales rep motivations

When you start to explore different franchise opportunities, you will come in contact with franchisor representatives and business brokers who have just one purpose—to sell you a franchise as fast as possible.  These individuals are not your trusted friends or unbiased financial advisors.  Certainly don’t sign any franchise agreement without prior review from an experienced corporate attorney who understands franchise valuations and royalty obligations.

3. Add up cost of acquisition

Sneaky franchise brokers are adept at hiding the true investment cost of a franchise purchase.  If you sign up to buy a franchise, your cost of acquisition is more than the down payment.  Include the amount you have to borrow to acquire the franchise plus other savings you may have to apply to the business until it achieves at least cash flow breakeven. (when net sales revenues exceed expenses every month)  This is the total amount you will have at risk in your new business.  How comfortable are you with this amount?  What would happen if you lost it all?

4. Evaluate owner’s compensation

Another trick of franchise sales reps is to present impressive financial projections of average franchise unit performance.  Look closely at these projections.  Do they include a budget allocation for the owner’s salary, healthcare, adequate insurance and other real world expenses associated with running a business?  If there is no allocation for an owner’s salary and benefits and you intend to work full time in the business, beware!

Remember, year-end profits should be your financial return on your invested capital, not your sole source of compensation for working 40 to 70 hours a week to keep the franchise alive!  Of course, the business could fail to generate a profit too which means you as the founder earns nothing for a lot of work.

5. Understand market value

Buy low, then sell high.  If you pay $25,000, $50,000, or $100,000 to buy into a franchise, then you should find evidence that other franchises can be sold at least for that much or more.  Unfortunately, the opposite is often true.

Research the market for this brand of franchise.  What are the average resale purchase prices in your state?  Who buys up franchises when the owner wants out?  Does the corporate office buy back franchises?  What does the franchise agreement call for?  Frequently, one regional franchise operator buys distressed properties at deep discounts.

Given all the risks associated with owning a business and personal obligation to repay debt, you should walk away from any franchise that cannot eventually be sold for at least two times your invested capital.

Unfortunately, I get too many letters from franchise buyers who are desperate to get out of a money-losing franchise.  They realize they overpaid for a franchise usually within a year of purchase.  They didn’t pay attention to the quantitative issues where they could lose hard cash because the sales reps kept their attention on how great it will be to at last be the boss of a money making business.   At the end of the day, they didn’t make any money and didn’t have any fun as a business owner.

Now you know better.

Susan Schreter is a devoted Yellow Ribbon Reintegration Program workshop presenter and founder of Start on Purpose, a service organization that empowers business owners anywhere in America to find and manage business funding with confidence.  Connect with her at Susan@StartonPurpose.

MIGHTY MONEY

6 ways veterans and service members can get their taxes done for free

It’s time for taxes! Whether you are a single service member living in the barracks, a retired four star spending your days fishing in Hawaii, or a veteran with a family working your way through college, taxes have to be done.


I used to have this elementary school teacher, Mrs. West.

I remember Mrs. West standing in front of our class and telling us with extreme seriousness that only two things in America were guaranteed: eventual death and taxes.

Here’s a 9-step guide to calculating your credit card interest
U.S. Air Force Senior Airman Holden Smith, 633rd Air Base Wing Judge Advocate paralegal, assists Senior Airman Terrence Eaton, logistics readiness squadron vehicle maintenance journeymen, in filling out a form at the Langley Air Force Base, Va., tax center Feb. 5, 2013. Joint Base Langley-Eustis tax centers are set to open Feb. 2 for the 2015 income tax season. (U.S. Air Force photo illustration by Senior Airman Aubrey White/ Released)

I remember that half of my class got super interested in science in hopes of figuring out how to one day live forever, and the rest of us just kind of groaned and decided that our parents were going to do our taxes forever if the other kids figured out that whole science thing.

And so far those damn science kids still haven’t come through for us, and we still have to pay taxes.

Adulting is hard AF, amiright?

Don’t have a heart attack yet, because there is hope — not for science, they still haven’t come through — but for taxes.

There are a lot of ways and places to get your taxes done for free or almost free, and this is really great because math and I got a divorce in my freshmen year of college and we haven’t spoken since.

Here’s a 9-step guide to calculating your credit card interest
Army Spc. Coltin Jenkins, tax preparer, works with customers of the Joint Base Myer-Henderson Hall Consolidated Tax center in Building 205 on the Fort Myer portion of the joint base March 17, 2015. (Joint Base Myer-Henderson Hall PAO photo by Rachel Larue)

1. Volunteer Income Tax Assistance

VITA, is sponsored by the IRS. Most larger military installations have a VITA office on base during tax season. VITA isn’t military specific, but they generally help tax payers who make less than $54,000. Check out VITA, what you need to take with you on a visit, and where their offices are.

2. Military OneSource

This outfit prepares and files taxes for free for active duty service members, National Guard and Reserve, and their spouses; retirees who were honorably discharged and are within 180 days past their discharge date, eligible survivors of active duty, National Guard and Reserve deceased service members, and family members who are in charge of the affairs of eligible service members are also eligible.

3. IRS Free File

Get this, the IRS lets you do your own taxes. For free. Sweet deal? Or worst nightmare. You decide. Either way, the IRS will allow you to download software to do your taxes for free if you make below $64,000, and they’ll give you a free form if you make above $64,000. I guess the folks sitting right on $64,000 are just SOL.

4. TurboTax

Uber popular TurboTax has a sweet deal right now. You can download their 1040EZ or 1040A for free, and the rest of their products are fairly well discounted. E1 – E5 can get the Deluxe Edition from TurboTax for free (normally $54.99), and E6 and above get a discount on all products. The best thing about TurboTax is if for any reason the IRS comes back and says “You done effed up,” TurboTax will pay you for the IRS penalties.

5. TaxSlayer.com

This service has a great military discount. Currently, its website advertises 50 percent off classic or premium editions. They have free email and phone support, and boast about being 100 percent accurate. They do not, however, guarantee no penalties from the IRS if there is a mistake.

6. H&R Block

These guys have a cool thing for filing online for anywhere from free to $38.49. The program is called H&R Block More Zero (because “Taxes are Lame” and “You Think These Taxes are About You” was apparently taken). H&R Block does offer peace of mind. For a fee. And it really is called “Peace of Mind.”

Here’s how it works: You get your taxes done. You pay an additional fee, and they promise that if you’re audited, they’ll send one of their lawyers to court with you and pay up to $6,000 in fees if they lose. If you don’t pay the extra… no peace of mind for you.

Also, they don’t offer any kind of discount for military.

Articles

Defense budget spotlight: What do weapons really cost?

Editor’s note: With news of the Air Force potentially awarding the contract for the next-generation bomber and Congressional Republicans reaching an agreement with the White House on the defense budget, WATM presents a short primer by our friend Winslow Wheeler on how the Pentagon tends to complicate how much things actually cost.


Here’s a 9-step guide to calculating your credit card interest

On Wednesday March 25, 2009, an F-22 crashed near Edwards Air Force Base in California. Sadly, the pilot was killed. The news articles surrounding this event contained some strange assertions about the cost of the crashed airplane. Based on the price asserted in the Air Force’s “fact” sheet on the F-22 that was linked to a Pentagon news release on the crash, the press articles on the crash cited the cost per aircraft at $143 million.

It was incomplete, to put it charitably, but the media passed it on nevertheless. The extant “Selected Acquisition Report” (SAR) from the Defense Department is the definitive DOD data available to the public on the costs for the F-22. The SAR showed a “Current Estimate” for the F-22 program in “Then-Year” dollars of $64.540 billion. That $64.5 billion was for 184 aircraft.

Do the arithmetic: $64.540/184 = $350.1. Total program unit price for one F-22 calculates to $350 million per copy. So, where does the $143 million unit cost come from? Many will recognize that as the “flyaway” cost: the amount we pay today, just for the ongoing production costs of an F-22. (Note, however, the “flyaway” cost does not include the pilot, fuel and other consumables needed to fly the aircraft away.)

The SAR cost includes not just procurement costs, but research and development (RD) and some military construction, as well. At about the same time as the crash, a massive lobbying effort had started to buy more F-22s, to reverse Secretary of Defense Robert Gates impending announcement (in April 2009) that he wanted no more. F-22 advocates were asserting the aircraft could be had for this bargain $143 million unit price. That was, they argued, the “cost to go” for buying new models, which would not include the RD and other initially high production costs already sunk into the program.

Congressional appropriations bills and their accompanying reports are not user-friendly documents, but having plowed through them for decades, I know many of the places and methods that Appropriations Committee staff like to use to hide and obscure what Congress and the Pentagon are actually spending. Let’s check through the 2009 congressional appropriations for the F-22. Most – but not all – of the required information is contained in HR 2638, which contained the Department of Defense Appropriations Act for fiscal year 2009.

In the “Joint Explanatory Statement” accompanying the bill, the House and Senate appropriators specified that $2.907 billion was to be appropriated for 20 F-22s in 2009. The math comes to just about what the Air Force said, $145 million per copy. So, what’s the problem?

Flipping down to the section on “modification of aircraft” we find another $327 million for the F-22 program. Switching over to the Research and Development section, we find another $607 million for the F-22 under the title “Operational System Development.” Some will know it is typical for DOD to provide “advance procurement” money in previous appropriations bills to support the subsequent year’s purchase.

In the case of the 2009 buy of 20 F-22’s, the previous 2008 appropriations act provided “advance procurement” for “long lead” F-22 items to enable the 2009 buy. The amount was $427 million.  Here’s the math: $2.907 + $.327 + $.607 + $.427 = $4.268 billion for 20 aircraft. That’s $213 million each.

Do not think these data represent an exceptional year. If you check any of the annual buys of F-22s, you will find the same pattern: in addition to the annual “procurement” amount, there is additional “modification,” RD” and advance procurement.

A few weeks later, F-22 advocate Sen. Saxby Chambliss, R–Ga., attempted to amend the 2010 DOD “authorization” bill coming out of the Senate Armed Services Committee to buy seven more F-22s for $1.75 billion, or $250 million each. The Chambliss effort, almost certainly worked out in close association with Lockheed Martin – a major F-22 plant is in Marietta, Ga. – surely sought to pay Lockheed the full amount to procure more aircraft: not $143 million each, but $250 million.

Clearly, Chambliss and Lockheed knew about some additional F-22 costs not included in my estimate of $213 million. The pathology of low-balling a weapon’s costs goes far beyond the F-22 example cited here; it is a basic tenet of bureaucratic behavior; it helps a program acquire support by top DOD management and Congress.

Understatement of cost does not occur in isolation in the Pentagon; it is accompanied by an overstatement of the performance the program will bring, and the schedule articulated will be unrealistically optimistic. Once the hook is set in the form of an approved program in the Pentagon (based on optimistic numbers) and an annual funding stream for it from Congress (based on local jobs and campaign contributions), the reality of actual cost, schedule and performance will come too late to generate anything but a few pesky newspaper articles.

(This post was excerpted from The Pentagon Labyrinth: 10 Short Essays to Help You Through It.)

Here’s a 9-step guide to calculating your credit card interest
About the author: Winslow T. Wheeler focuses on the defense budget, why some weapons work and others don’t, congressional oversight, and the politics of Pentagon spending. Before joining the Center for Defense Information in 2002, he worked on Capitol Hill for four U.S. Senators from both political parties and for the Government Accountability Office. At GAO and the Senate, Wheeler focused on Pentagon budget issues, weapons testing, the performance of U.S. systems in actual combat, and the U.S. strategic “triad” of nuclear weapons.

MIGHTY MONEY

ADPI H.E.L.P.S: Six Secret Hacks to Financial Freedom for Your Family

How to use your Veteran Benefits to Help Achieve Financial Independence

Can you, as a veteran, hack military benefits to financial freedom?  Yes.  The average American household spends $5,000/month.  Let’s imagine that this represents you.  If you succeed in stacking your benefits as monthly passive income to outweigh $5K/month, then you win in hacking your way to financial freedom.

Here’s a 9-step guide to calculating your credit card interest

You can win freedom by increasing money flowing in or reducing the money flowing out.  I prefer to focus on income, to think offensively, vs. the defensive approach of aggressive saving and living frugally.  Your expenses can shrink to the floor, but your income has no ceiling.  And as we say in the military, the defense sets up the offense.  The offense remains decisive.

As a veteran, there exist at least four significant sources of passive income that you should hack:  retirement, VADC, SSDI, and VR&E.  You also have at least two state-level benefits on which to give serious thought:  zero property tax, and free college for your dependents.

For illustration, let’s say that you’re an Army Captain (O-3E) retiring at 20 years in 2020.  Let’s also say that you fall under the High-3 pension, with two dependent children, and have a good chance at VA 100.  And yes, presume $5,000/month in expenses.  Sneak peek.  That means $3,700/month (pension), $3,300/month (VA 100), $2,800/month (SSDI), and maybe $1,500/month (VR&E housing stipend).  That adds up to $11,300/month, best-case scenario.

Veteran Retirement and Pension


Retirement qualifies you for a pension.  There exist four pension types:  Final Pay, High-3, CSB/REDUX, and BRS.  The math goes as follows, monthly pension = (retired base pay) x (multiplier) x (years of service).  At present, you can’t choose.  It’s a moot issue.  You have what you have, and that got determined by when you entered.  In our example, the High-3 applies to you.  It calculates as follows, $3,700 = (approx. $7,400) x (2.5%) x (20 years).

There exist five types of retirement:

  • Regular.  Completed 20 years of active service.  You can begin active duty as early as age 17 and retire at 37.  Some do.
  • Reserve.  Reservist with 20 years of service who has reached age 60.  Sometimes called a non-regular retirement.  Ready Reserve recalled to active duty or in response to a national emergency, shall have the age 60 requirement reduced by 3 months for each cumulative period of 90 days (3 months) so performed in any fiscal year after 28 Jan. 2008.
  • TERA.  Temporary Early Retirement Authority.  At least 15, but less than 20 years of active service between 2012 and 2025.  Program expected to end 31 Dec. 2025.  Future use of TERA will require approval by Congress.  Specific eligibility criteria for TERA depends on the service branch.  The Army has in place a limited use of TERA, enough to conclude that it’s not an option.
  • TDRL.  Temporary Disability Retirement List.  Temporary disability rating, placed on retirement rolls by member’s branch of service (max of 5 years) before returning to duty, separating, or proceeding onto PDRL.  Results from a med board.  This results in a military pension.  This retirement check comes from the DOD and not the VA.
  • PDRL.  Permanent Disability Retirement List.  Placed on the retirement rolls by member’s branch of service.

All of the above will result in a pension.  The math will differ for each.  We’ll continue with our High-3 and regular retirement example.  But I’m guessing that you’ll want an idea of how to retire as soon as possible, and with the highest return you can get.  Keep reading.

Regular, reserve, and TERA allow with reasonable certainty for Concurrent Retirement Disability Pay (CRDP).  That means both the pension plus VADC.  CRDP requires retirement under the first three, as well as a ≥50% VA disability rating.  In our example, that means $3,700/month plus $3,300/month (VA 100), or $7,000/month so far and well over the average in household expenses.

Otherwise, the only way to get both, concurrently, is through Combat-Related Special Compensation (CRSC).  The criteria:

  • Entitled to or receiving retired military pay
  • Rated at least 10% by VA and combat-related
  • Have waived VA pay from retired pay (the VA waiver or offset) (it’s a bit complicated)
  • Can present documentation for the event resulting in the condition

Notice that CRSC can occur before 15 or 20 years, and pay the pension plus VADC.  The math will adjust accordingly.  To keep this article from getting too long, I won’t go over it here.  Know that less time in service or a lower disability rating means a smaller compensation amount.  Also note that yes, with CRSC, you can stack both the pension and VADC, and well before 15 or 20 years.  Such a case would most likely look like TDRL/PDRL plus CRSC.

By the way, combat-related need not refer to actual combat.  Combat-related may mean training that simulates war, e.g., exercises or field training.  It could mean hazardous duty, such as dive, flight, parachute.  Or come from an instrumentality, such as combat vehicles or weapons.  In 2011, as a Second Lieutenant (O-1E) at Fort Lee, a Private negligently discharged her rifle during a range and almost shot my foot.  If she had shot my foot, that would’ve counted as combat-related.

VA Disability Compensation (VADC)


Here’s the big one.  A high enough VADC rating can lead to SSDI, VR&E, zero property tax, free college for dependent children, student loan forgiveness, and more.  The goal here is not to be disabled but to obtain disability compensation.  And winning compensation is probably much easier than you think.  There’s no lying or cheating required or encouraged – only diligence.  We’ll go over ways to give your claim the best chance possible.

Keep this framework in mind:  How much is it?  How long will it take?  Claims, conditions, criteria, and appeals?  Anything quirky?  Where can I get help?

How much is it?  The amount will depend on the VA’s final composite rating and the number of dependents.  The higher the composite and the more dependents, the higher the amount.  In our example, a 100% VADC (or VA 100) with two dependent children would pay $3,300/month, non-taxable.

The final or composite score consists of adding up the ratings of each separate disability.  Two disabilities, each rated at 50, do not add up to 100.  The VA uses a unique table.  If you search Google for a VA disability calculator, try punching in 10 different disabilities.  With 10 disabilities, you’ll need to score the following individual ratings at the least for VA 100:  70, 40, 40, 10, 10, 10, 10, 10, 10, 10.  Notice that using lay math, these individual ratings add to 220.  The rule of thumb is to shoot for 250+ points to reach VA 100.

How long will it take?  Six months to a year or more.  Anecdotal evidence from my friends who’ve reached VA 100 tell me about two years.  You can begin your claim at https://www.ebenefits.va.gov/ebenefits/login, six months from separating or retiring, or upon referral to a medical board.  Fill out the VA Form 21-526EZ.  If you’ve been referred to a medical evaluation board (MEB), your claim will happen as part of the IDES (Integrated Disability Evaluations System) process.

Claims.   Two types, standard and a Fully Developed Claim (FDC).  File an FDC.  The standard claim relies on the VA to obtain your medical information.  The FDC lets you take charge.  It means more work for you, but you don’t want to leave this up to the VA.

When filing your FDC, look for a form to attach to it called a Disability Benefits Questionnaire (DBQ).  DBQ refers to a category of standardized forms for specific disabilities.  The VA has created over 70 DBQs, one per disability.  For example, if you intend to file a claim for scars or disfigurement, the DBQ for that is Form 21-0960F-1 (scars/disfigurement).  Check if the disability you intend to claim already comes with a corresponding DBQ.  If not, no worries.  Continue mission.

Conditions.  Two types, primary and secondary.  Primary disabilities refer to those which military service caused or aggravated (made worse).  Notice the part about the military having made worse the condition.  Even if pre-existing, it suffices VADC that military service has exacerbated it.  Primary conditions represent the category that most of us know, and on which we spend most of our efforts trying to win.

There also exist secondary disabilities.  Whereas primary refers to a direct service-connected condition, secondary refers to indirect.  Secondary connects to primary.  These seem easier to win.  Whether they are, know that they represent one more way to increase odds of VA 100.  Some of the more common reasons connecting secondary to primary include behavioral health, illness, medication side effects, and overcompensation.  Also, note that the connecting primary may suffice at a non-compensable rating of 0%.

Yes, 0%.  0% compensation for a primary condition still means service connection, although non-compensable.  You may still use it to achieve compensation for a secondary.  One more time, realize that a 0% rating on a primary can still service-connect to a 100% rating on a secondary.  Makes sense?  It doesn’t matter.  One more way to stack the odds and the benefits in your favor.

Criteria.  For the VA rater to decide, you must connect at least three records:

  • What · your present impairment limits your earning capacity
  • When · you experienced an illness/injury while serving active duty
  • Nexus · that illness/injury caused/aggravated the present impairment (service connection)

Something happened on active duty.  That something, or set of somethings, produced or made worse your present medical condition.  You indeed have a medical condition that limits your earning capacity.  Get straight to the point.  Give the rater these records and nothing more.  If you lack one of these records or clog his inbox, it makes work difficult for him and unlikely for you to win.

The medical nexus letter will look like a memo for the record (MFR).  It should contain four parts:

  • Records review.  The medical professional writing the letter must state that he has looked at your relevant medical records.
  • Medical opinion.  The opinion, which must at minimum say, at least as likely as not (the 50% probability evidence standard).  Equipoise.
  • Medical research.  Reason and evidence to support the opinion.
  • Credentials.  The examiner states his relevant credentials.  An eye doctor probably knows more about feet than a VA rater.  But when it comes to your foot problem, the VA doesn’t want your eye doctor’s opinion.

For each disability you claim, you should also fill out a VA Form 21-4138 (statement in support of a claim).  Tell your story.  Say what the condition is.  Identify what it resulted from, the symptoms, and the severity of those symptoms.  Describe the degree to which it has limited your life.

If the claim requires lay evidence, ask someone relevant to your case to fill out a VA Form 21-4138.  When filled out as lay evidence, it now becomes a buddy letter.  In his letter, he should state how well he knew you during the qualifying incident, and then what he observed about you.

Along the way, the VA may ask you to undergo a C&P (compensation and pension) exam.  It’s a medical review with a VA doctor.  It could be a few questions or a comprehensive physical exam.  Be honest, of course, but do not be on your best day either.  The C&P examiner aims to disqualify you.  Furthermore, carry with you the attitude that you gave military life your best effort.  If he sniffs you out as lazy or looking to milk the system, he’ll decide accordingly.

Even if he does decide against you, you may still get a second opinion from an approved examiner of your choice.  Notice the word equipoise above.  Given a 50% probability, such as when the C&P says no, but your doctor says yes, the benefit of the doubt goes to you.

Appeals.  Yes, you can appeal.  Search for VA Form 20-0998 (your rights to seek further review of our decision).  It outlines four review options:  supplemental claim, higher-level review (HLR), appeal to the board, and a U.S. District Court complaint.  File a supplemental claim given new and relevant evidence.  File an HLR when you have no new evidence.  These first two, especially HLR, appear to result in more success than the last two and happen much quicker.  The last two take years.  The VA Form 20-0998 gives instructions on how to file for review.  More ways to win.  Keep at it.

Quirky things.  We’ll discuss SMC (special monthly compensation) another time.  Know that there exist four types of VA 100:  temporary, schedular, TDIU, and P&T.  Temporary means you’re incapacitated or suffering a severe condition.  If schedular, you reached about 250 lay points.  TDIU pays the equivalent of VA 100 if the member rates at least VA 60 or 70 and cannot obtain substantially gainful employment.  Permanent and Total (P&T) provides the least likely chance of reduction later.  You want P&T.  If you’ve reached VA 100 the other ways, you may write to your local VA Regional Office to request P&T.

Recap.  Stack the odds in your favor.  Use FDCs and DBQs.  File for both primary and secondary disabilities, and claim as many as reasonable.  Shoot for 250+ lay points.  Add buddy letters.  Present the rater with what he needs, and nothing more.  Realize TDIU could shortcut to VA 100.  And use supplemental claims and HLRs.

Get help.  Check out www.VAClaimsInsider.com.

Social Security Disability Insurance (SSDI)


Yes, the SSA computers talk to the VA computers.  But eligibility with one doesn’t automatically translate into the other.  Check out www.socialsecurity.gov/woundedwarriors.

VADC covers a veteran for loss of earning capacity because of a service-connected medical condition.  SSDI compensates the applicant for the loss of the ability to do substantially gainful work because of a medical condition.  For SSDI, the condition must have lasted or be expected to last at least a year or to result in death.

How much is it?  For our notional Captain (O-3E) with 20 years of work credits, that’s $2,000/month plus $400/month each for two dependent children, or $2,800/month.

How long will it take?  Expect about six months to get a response from the SSA, and a mandatory five-month wait if approved.  Oh, and the five-month wait comes with no back pay.

Claims, conditions, and criteria.  First, you need to meet the non-medical requirements:  sufficient work credits, below retirement age, residency, and not working or earning too much.  As a veteran, you likely already meet all of those.  Then, the SSA asks five questions when evaluating SSDI:

  • Do you work too much or make too much money?
  • Is your medical condition severe?  Will it last at least 12 months?
  • Does the condition meet or exceed a listing?  A listing is a condition found on the SSA’s Listing of Impairments.  It outlines the SSA’s established set of medical conditions determined severe enough to prevent one from performing any gainful activity.
  • Can the applicant perform past relevant work?
  • Can the applicant retrain for new work?

Income, condition, listing, past work, and retraining.  To award SSDI, the applicant must reasonably answer, respectively:  no, yes, yes if so, no, no.  But the gist of it is that the condition must have lasted or be expected to last at least a year or to result in death.

Appeals.  Yes, you can.  Your denial letter should explain.  You typically receive only 60 days from the date of the denial letter to appeal.  If you miss the deadline, you may have to start from the beginning.  Recommend that you seek help by this point.

Quirks.  Instead of applying online or in person, call the SSA at (800) 772-1213.  One book on Social Security puts the burden back onto the SSA when it comes to form-filling and the nuisances of interpreting the forms.  The SSA would know best anyway on how to fill out its own forms.  If you don’t finish it all in one day, the SSA will schedule another phone call to work around your schedule.

You can get SSDI while still serving on active duty.  In what scenario?  Assignment to the Warrior Transition Unit (WTU).  Not easy, but not impossible.

Get help.  Check out Side by Side Solutions, LLC, https://www.facebook.com/sbssolutions, founded by Lisa Hiering, mother of a disabled Marine.

Vocational Rehabilitation & Employment (VR&E)


VR&E intends to help a veteran fix his vocational impairment or employment handicap, resulting from a service-connected disability.  It consists of five tracks.  I’ll just cut to the chase.

How much is it?  Track 4 (employment through long-term services) can work just like the Post-9/11 GI Bill and pay a monthly housing stipend, or subsistence within the VR&E language.  Think of it as BAH.  It depends on the school and on attendance, but we could reasonably estimate around $1,500/month.

There’s also a Track 3 (self-employment) that could pay up to $100K towards business startup costs.  Yes, up to $100K, to you.  You can ride Track 4 up through a doctorate and then get $100K through Track 3 to start your practice.

How long will it take?  Expect about a month to get a meeting with a Voc. Rehab. Counselor (VRC), then another two months to get a decision.

Claims, conditions, criteria.  Fill out a VA Form 28-1900 at www.ebenefits.va.gov/ebenefits/login.  The VA will also ask you to fill out an Individualized Employment Assistance Plan (IEAP), in which you outline exactly what it’ll take to help you.  You’ll need at least a VA 20 rating, or VA 10 for a serious employment handicap.

There’s a 1,200-page manual called the M28R that the VRC uses to do his job. If you’re wondering what questions he’s trying to answer, then check out Part IV, Section B, Chapter 2 (evaluation and planning determinations).

Appeals.  Can you?  Yes.

Quirks.  The C in VRC may stand for counselor, but you should treat him like the C&P examiner.  Think of him more as an interviewer.

Get help.  Check out attorney Benjamin Krause at www.DisabledVeterans.org.

Zero Property Tax · State-Level


Some states, like Texas or Florida, provide zero property tax for disabled veterans.  Also called a homestead exemption.  Typically for VA 100.  Rules vary by state.  For a quick list of states that offer this, check out https://hadit.com/disabled-veterans-property-tax-exemptions-state/.

For a summary of all benefits by state, check out https://myarmybenefits.us.army.mil.  It’s an Army website that summarizes veteran benefits applicable to all service members.

Free College for Dependents · State-Level


Florida and Texas also offer free college tuition in-state up through a BA/BS for the dependents of a disabled veteran.  Typically for VA 100, but a lower rating might suffice.  Varies by state.  Check out https://www.affordablecollegesonline.org/college-resource-center/scholarships-for-veterans-and-dependents/.

Although not direct cash, that’s still a BA/BS degree that would’ve cost $40K at a public four-year college (in-state student), $90K public four-year (out-of-state), or about $180K private.

Bonus · Four More Financial Freedom Hacks!

House Hack · VA Home Loan Guaranty


Use the VA home loan guaranty to get zero down on a residential property.  This hack lets you obtain up to a four-plex.  You could reside in one unit and rent out the other three.  In the unit you live, you could further hack that with roommates or Airbnb.  Eventually, you could refinance to then re-use the VA home loan guaranty and obtain yet another multi-family.

Here’s a 9-step guide to calculating your credit card interest

Credit Card Hack · SCRA (Title 50 USC Chapter 50)


Credit cards typically come with a low introductory rate (anywhere from 0% APR to a little more) before becoming about 20%+ APR.  However, if you serve on active duty or if the military called you onto active duty, among other benefits, the SCRA provides a cap at 6% APR and a waiver of service and renewal fees.

By the way, Chase gives me 0% APR as part of its SCRA benefit.  If your side hustle consists of e-commerce, use this credit card hack to boost your margins from arbitraging goods.  How often do the credit card companies check?  About once a year, otherwise, they use your anticipated (hint, self-reported) end date.  Self-reporting applies to those with indefinite contracts.  If this is you, I’m sure you can see how you could self-report an end date far into the future.

Student Loan Hack

 https://DisabilityDischarge.com


On 21 Aug. 2019, President Trump signed a memo to cancel student loan debt for disabled veterans.  To qualify, you’ll need to have either reached VA 100 or have been approved for SSDI.  See https://disabilitydischarge.com for details.

Time Hack · Army Career Skills Program

 www.DODSkillBridge.com


The Army’s Career Skills Program (CSP) allows a Soldier to spend the last six months of active duty interning with a school or employer.  While on CSP, the Soldier still gets paid as if on active duty but instead reports elsewhere.  I’ve seen this flow as smoothly as a one-page form signed by an OIC.  Are you separating or retiring?  Do you have a friend who also happens to have her own business?  It’s like shaving six months off your contract.

This article originally appeared on Active Duty Passive Income. Follow them on Facebook.

MIGHTY MILSPOUSE

Recent changes with the 2020 NDAA and how they impact you

The National Defense Authorization Act (NDAA) is an annual piece of legislation which gives authority and funding to the United States Military. While it is a detailed body of work that doesn’t make for light reading, it should be read. This legislation is filled with items that impact the military family directly.


It addresses military pay

The 2020 NDAA provided a 3.1% pay raise to military service members. This pay raise was the biggest one to be received in the last decade and was reflected in the first paycheck received by service members of 2020. The bill also extended specific bonuses and special pay. One of the big take-aways of this bill is the focus on supporting not just the member, but the military family as a whole.

Military spouse education and employment

Within the bill there are increases in support of professional licensure for spouses. With the new 2020 bill, spouses are currently eligible for up to 00 in reimbursement for licensure costs accumulated when moving. This is twice the amount that was authorized in last year’s bill. It also addresses license portability by giving authorization to the Council on State Governments to research ways to create reciprocity across state lines.

The bill also extended opportunities for spouses for education. The My Career Advancement Account program is an example of this, as it is a valuable resource for military spouses. It offers up to 00 in assistance for licensure, certification, or an associate’s degree in a field that is portable. The eligibility for this is limited to E-1 through E5, W-1 through W-2, and O-1 spouses. The initial pilot program had it available to all spouses but rising costs and enrollment forces restrictions in who can utilize this benefit. In this bill language, Coast Guard spouses were also included even though they fall under the Department of Homeland Security.

Military housing reforms

One of the key elements of this bill is that it addresses the issues within military privatized housing. The bill created new accountability for these companies by enforcing quality assurance measures. It also increased the number of required inspections. This bill provides an additional 1.8 million dollars to make sure that each housing office has the vital personnel it needs to ensure military families are taken care of.

One of the tools that will be utilized going forward is a way to assess and evaluate for risks within military housing. This includes things like mold and lead. It also allows for the BAH to be withheld from the private housing entity until issues or disputes are solved. Another key piece is that it forces transparency by requiring these entities to disclose repairs or issues prior to lease signing. There will also now be a required Tenant Bill of Rights and minimal livable standards established.

Military family needs

The NDAA also authorized million for the STARE BASE program, which is a DOD youth program. It is an American military educational program for grades K-12 that teaches science and math in hands on ways. It was created to tackle the low rates of readiness in these subjects by implementing a program that makes math and science fun and interactive. To learn more about this program and to see if it’s located in your area, click here.

One of the chief concerns outlined in the 2018 Blue Star Families survey was that 72% of military families cannot find reliable childcare. An amendment was included in the NDAA for 2020 that creates more coordinator positions on bases to assist with childcare and extends childcare hours for families.

Another key piece to this legislation is that it created the ability of military service members to sue under administrative claims for medical malpractice by a military provider. Although there was existing legislation for under the Federal Tor Claims Act, the United States itself was immune. After countless hearings within congress over a decade, this amendment passed within the NDAA. If a service member sustains injury or death they can file a claim and receive up to 0,000 as long as they file it within two years.

Surviving spouses receive relief

Finally, one of the biggest parts of the 2020 NDAA is the elimination of what is known as the “widows’ tax” in phases. For multiple decades surviving families have not received their full benefits as they deserve, even though they paid into the benefit programs. This is a piece of legislation that has been debated and fought over for almost twenty years. Finally, change is coming and it will be finalized by 2023.

If you’d like to look through the 2020 NDAA, you can find it here. Fair warning, it is 1119 pages long. However, a pro tip is to utilize the search ability within the document to enter terms that you want to specifically read about. This will bring you exactly where you need to go. Happy reading!

This article originally appeared on Military Spouse. Follow @MilSpouseMag on Twitter.

MIGHTY MONEY

Program encourages banking for Veterans

The Veterans Benefits Banking Program (VBBP) is giving Veterans and their families access to greater financial independence, resiliency, and literacy.

VBBP is a partnership between the U.S. Department of Veterans Affairs (VA) Veterans Benefits Administration (VBA) and the Association of Military Banks of America (AMBA). The idea for the program came after a VA analysis revealed a high rate of Veterans were “unbanked,” says Joe Gurney, Senior Advisor of Fiscal Stewardship for the Office of the Under Secretary for Benefits.

“We were seeing an uptick in fraud because hundreds of thousands of Veterans were unbanked, so the Under Secretary actually had me look into this. By unbanked we mean Veterans receiving their VA benefits on a prepaid card or by check. I spent some time doing an analysis about demographics, where they were, who they were, and it turned out there were over 200,000 Veterans who were unbanked,” Gurney said.

Dr. Paul Lawrence, VA Under Secretary for Benefits, charged Gurney with determining courses of action to address the issue. Through his research, he found AMBA — an association of banks operating on military installations. The organizations committed to a joint effort of working with those financial institutions that already “have experience dealing with the unique financial challenges of military members and their families,” retired Air Force Maj. Gen. Steven Lepper, President and CEO of AMBA, said.

A white paper identified key areas affecting today’s Veterans, such as not being able to get a bank account and incurring high fees when cashing checks or using prepaid cards. The VBBP then created a number of common requirements for participating banks and credit unions to join the program, including:

  • Willing to provide free checking accounts and free access to ATM networks to Veterans who deposit their monthly VA benefits in their account, and
  • Helping any Veteran become qualified to open a banking account.

Another pillar of the program is a goal of simplifying banking choices by helping eligible Veterans select the right bank and services for themselves and their families. The VBBP website also includes links to resources on topics like fraud protection, identity theft, financial education, and a checklist for opening a bank account.

Lepper adds the VBBP is a work in progress and there are already talks for ways to improve the program.

“Veterans have as many needs as there are Veterans. It’s hard to generalize with anyone, whether they’re military or Veterans. We’re always on the lookout to help make Veterans’ management of their financial resources much more effective and safe,” Lepper, who served 35 years in the Air Force, said.

Gurney says the VBA also looks at trends in the unbanked on a constant basis to identify lessons learned and drive future program enhancements.

“AMBA has setup a constant feedback loop to try to give our Veterans the best experience that we can. For example, we discovered that Veterans want financial education. They want information — especially during COVID – that helps them deal with money, particularly borrowing money. As a result of that feedback, we added financial education to the VBBP website and plan to expand it as we continue improving the program,” Gurney said.

Lepper explains that by giving Veterans access to banking options, it also creates a motivation to save.

“The one benefit you don’t think about immediately when you think about opening a bank account versus receiving your benefits on a prepaid card or by paper check is the ability to save money. If you cash a check or withdraw all the money on your prepaid card; you walk around all month with money in your pocket. With checks and prepaid cards, there’s no motivation to save and no mechanism to save, whereas with a bank account, you do have that ability to save money in a safe and cost-effective way.

“What we’re hoping, as a collateral effect of opening up a bank account or credit union account, is that our Veterans will be able to save money and not live month-to-month on their VA benefits,” Lepper said.

Other features of utilizing a bank or credit union account:

  • Get access to reasonable loan amounts with advantageous interest rates, and
  • Credit repair.

Thirty four financial institutions are now part of the VBBP. In addition to ensuring Veterans and their families receive benefits safely and reliably, the participating banks and credit unions offer another advantage: accessibility.

A key component of the program is to meet Veterans where they are, whether that be in a large metropolitan area, rural town, or online. By working with financial institutions that have diverse geographical and digital footprints, Veterans can receive streamlined access to information and communication that caters to their needs. Another goal was to create a robust program that is easy to navigate. The VBBP website https://veteransbenefitsbanking.org/ contains a directory that lists participating banks and credit unions, along with direct links to more specific information on products and services.

Since the inception of the program at the end of 2019, VBBP has grown to roughly 1,000 website visitors per week, revealing a growing interest in both financial education and banking options. Now that awareness is growing, Gurney recommends Veterans take that next step of setting up an account so that they no longer have to put themselves at risk by relying on external entities like check cashing companies.

“We really want to urge Veterans during this time, especially with COVID, to consider direct deposit and setting up a bank account so they can have an easier, faster, and safer way to bank,” he said.

Once Veterans have a bank account, they can sign up for direct deposit by either updating their profile on va.gov (and providing their bank account and check routing numbers) OR by calling 1-800-827-1000.

As the partnership moves into its second year, the organizations plan to expand need-based resources that meet Veterans where they are in their financial life cycle.

Any Veteran or beneficiary who receives federal monetary benefits and who wishes to receive their benefit payments electronically can participate in the VBBP. A full list of participating banks and credits unions can be found at https://veteransbenefitsbanking.org/.

This article originally appeared on Military Families Magazine. Follow @MilFamiliesMag on Twitter.

Articles

9 incredibly successful companies founded by military veterans

It should be no surprise that skills learned in the military such as decision-making under pressure, organization, and leadership translate well to the corporate boardroom. And those skills tend to make a big difference, with companies led by former military officers tending to show better performance.


People like Fred Smith or Sam Walton have become household names for their business success. Lesser known is their service prior to the companies they founded.

Also read: 10 entertaining military podcasts you need to know about

After World War II, nearly 50% of veterans went the entrepreneurship route, though that number has substantially declined today. Still, there are currently around 3 million veteran-owned businesses.

Here are 9 companies started by military veterans.

1. RE/MAX, cofounded by Air Force veteran Dave Liniger

Here’s a 9-step guide to calculating your credit card interest
RE/MAX

Prior to founding “Real Estate Maximums” — better known as RE/MAX— Dave Liniger served in the Air Force during the Vietnam War.

From 1965 to 1971, he served as an enlisted airman in Texas, Arizona, Vietnam, and Thailand, according to his LinkedIn.

“The military really gave me the chance to grow up. It was fun. I thought it was a fabulous place,” he told Airport Journals. “It also taught me self-discipline and a sense of responsibility.”

After he got out of the military, he started flipping houses for profit, and eventually got his real estate license. He cofounded RE/MAX with his wife Gail in 1973.

2. Sperry Shoes, founded by Navy veteran Paul A. Sperry

Here’s a 9-step guide to calculating your credit card interest
Sperry

You can thank a former sailor in the US Naval Reserve for inventing the world’s first boat shoe.

In 1917, Sperry joined the Navy Reserve, though he didn’t stay in for very long. He was released from duty at the end of the year at the rank of Seaman First Class.

Still, his experience there and further adventures sailing led to the founding of his company, which eventually created the first non-slip boating shoe. He founded Sperry in 1935.

During World War II, his Sperry Top-Sider shoes were purchased by the boatload by the Navy. Now nearly a century later, they are still a favorite of sailors everywhere.

3. FedEx, founded by Marine Corps veteran Fred Smith

Back before FedEx was the behemoth logistics company it is today, founder Fred Smith was observing how the military was getting things from point A to point B.

After graduating from Yale University, he was commissioned as a Marine Corps officer and served two tours in Vietnam. He earned a Bronze Star, Silver Star, and two Purple Hearts,according to US News.

Only two years after he left the Corps, he started Federal Express.

“Much of our success reflects what I learned as a Marine,” he wrote forMilitary.com. “The basic principles of leading people are the bedrock of the Corps. I can still recite them from memory, and they are firmly embedded in the FedEx culture.”

4. Walmart, cofounded by Army veteran Sam Walton

WalMart is the largest company in the world.

It was founded by a former Army intelligence officer named Sam Walton.From 1942 to 1945, Walton was in the Army and eventually rose to the rank of captain. His brother (and cofounder) Bud served as a bomber pilot for the Navy in the Pacific.

According to the company’s history, Sam Walton’s first WalMart store, called Walton’s Five and Dime, was started with $5,000 he saved from his time serving in the Army and a $25,000 loan from his father-in-law.

5. GoDaddy, founded by Marine Corps veteran Bob Parsons

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The company responsible for registering a large portion of the world’s web domains, GoDaddy, is the brainchild of Marine veteran Bob Parsons.

Parsons enlisted in the Corps in 1968 and later served in Vietnam, where he earned a Combat Action Ribbbon, the Vietnamese Cross of Gallantry, and the Purple Heart for wounds he received in combat.

“I absolutely would not be where I am today without the experiences I had in the Marine Corps,” he writes on his website.

In 1997, he started GoDaddy. In 2014, it filed for a $100 million IPO. He left the company around that time to focus on his philanthropic efforts

6. WeWork, founded by Israeli Navy veteran Adam Neumann

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Adam Neumann | Adam Neumann

Hot coworking startup WeWork is the 9th most valuable startupin the world, and it was started by a veteran of the Israeli navy.

Adam Neumann started a coworking office space for entrepreneurs in New York City back in 2011.Today, WeWork has 128 offices in 39 cities around the world.

Born in Tel Aviv, Israel, Neumann served as a navy officer there for five years before moving to the US in 2001.

7. Taboola, founded by Israeli Army veteran Adam Singolda

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Taboola Founder and CEO Adam Singolda. | Taboola

Another veteran of the Israel Defense Forces is Adam Singolda, the founder of content recommendation engine Taboola.

Like many other successful Israeli entrepreneurs who served in the IDF (military service ismandatory in Israel), Singolda developed many of the skills that would help his company later on in the military intelligence field.

He ended up serving for seven years as an officer with the elite Unit 8200, the Israeli military’s version of the NSA.

He started Taboola back in 2007, and you have surely seen his work under the many millions of articles who feature “Content You May Like” that the company generates at the bottom. Taboola raised a round of financing in 2015 that put its value at close to $1 billion.

8. Kinder Morgan, cofounded by Army veteran Richard Kinder

The fourth largest energy company in North America was cofounded by Vietnam veteran Richard Kinder. Along with his business partner William Morgan, he started the company in 1997.

He earned his law degree at the University of Missouri before serving in Vietnam as a US Army captain. He was in uniform for four years as a Judge Advocate General officer (aka a military lawyer).

9. USAA, founded by a group of Army officers

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Flickr/Fort Rucker

It may not be a huge surprise that USAA — a company that exclusively caters to military veterans and their families — was started by veterans.

Interestingly though, it doesn’t have just one founder. It has 25.

Back in the 1920s, it was pretty hard for military service members to get (or keep) auto insurance, since it was either way too expensive or likely to get cancelled since they moved around so much.

So Maj. William Henry Garrison and 24 of his fellow Army officers got together in 1922 and formed their own mutual company to insure themselves, according to Encyclopedia.com. Today, the United Services Automobile Association provides insurance, banking, and investment services to nearly 12 million members.

Disclosure: I personally have USAA insurance and use its banking services.

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Warrior Rising helps vetrepreneurs build sustainable businesses

Almost every military career ends with the service member making a decision: find a job or start a business. For those in the National Guard or reserves, this choice parallels time in uniform.

Veterans who choose the path of entrepreneurship have an added resource to lean on. Jason Van Camp founded Warrior Rising — a nonprofit organization dedicated to helping veterans and their immediate family members start their own businesses.


“When you were getting out of the military you had a question, and that question was ‘now what? What am I going to do with myself?'” Van Camp said. “You probably thought to yourself ‘you know I could just sit back and collect my retirement or I could get a job or I could start a business.”

Starting a business after leaving the military is a journey Van Camp knows well. The former green beret left the Army after a seizure disorder forced him to medically retire. He founded Mission 6 Zero, a leadership development firm with high-profile clients including the NFL and Major League Baseball.

Warrior Rising was launched to help other veterans make the transition to business ownership. The resources provided by the organization are free to veterans and their immediate family members. It is funded by donations with 82.4% of every dollar going to veterans. The rest, Van Camp said, goes to overhead. He added that initially, 100% of donations went to veterans, but the company grew too large and he had to hire paid staff to keep up with demand.

In the five years since its founding, Warrior Rising has grown exponentially. In 2015 the company helped six veterans establish businesses. Last year the number was 1,016. This year, Van Camp said, Warrior Rising on pace to help 1,500 veterans start new businesses with about 40 signing up every two weeks.

Despite frequently saying during an online interview that “business is hard,” Van Camp said Warrior Rising already has some success stories.

Firebrand Flag Company, for example, recently sold out on a limited run of fireproof American flags.

“They’re ramping up business right now and I have no doubt this is going to be a multi-million-dollar company,” Van Camp said.

People interested in using Warrior Rising’s free services should first go to the organization’s website to sign up. Van Camp said an intake specialist will call the applicant within 48 hours.

“So, you have an intimate one-on-one conversation with someone about your business idea, what you’re trying to accomplish, why you’re trying to do it. Is it a good idea? Do you have the money for this? Does your spouse support you?” Van Camp said. “Questions about the actual journey you’re about to embark on.”

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From there, applicants are sent to Warrior Rising’s education platform, Warrior Academy – online training that translates a military operations order into a business model. Van Camp said the training is designed to be difficult to prepare would-be entrepreneurs for the realities of owning a business.

“You can’t start out with 0,000 salary. That’s not how it works in business,” he said. “You’re going to have to grind and go without pay and suffer for a while before you start seeing revenue — before you start seeing everything start to pay off and you see a return on investment.”

After the training is complete, applicants are paired with mentors who are successful in the industry the veteran hopes to succeed in. Van Camp said the mentors are usually, but not always veterans.

Eventually, after the veteran has met all of the requirements, they can ask Warrior Rising for financial assistance and the organization will assist them in finding investors, loans or grants.

But that’s not the end of a veteran entrepreneur’s journey with Warrior Rising.

“What I realized is it wasn’t just about starting a business and finding your purpose through business ownership, it was also about creating a community and joining a community and joining a tribe of people that can support you and you can feel comfortable with like you’re part of the family with,” Van Camp said. “We have platoons all over the country.”

In the past, the organization hosted numerous in-person events, but the ongoing coronavirus pandemic has forced Warrior Rising to turn to online venues for events.

Van Camp described coronavirus as a game changer in many ways for those hoping to start businesses. First, he said, more people are applying for Warrior Rising’s assistance.

“It’s been even more prevalent because of COVID,” he said. “Because people are at home looking for that next step because they ask the question ‘now what’ and they come to Warrior Rising for help.”

He said the pandemic will continue to affect the business world for the foreseeable future. He said trucking and logistics, online services and recreational vehicle sales businesses are doing well. His outlook is equally optimistic for credit card processing companies, home security and solar sales.

The outlook is less rosy for commercial real estate.

“Clients of mine that have office space, they’re realizing right now that they don’t need office space. They can work from home,” Van Camp said. “They’re putting as much product out the door as they did before. Private equity firms, venture capitalist firms, the companies that basically control their finances are going to say ‘listen, anything that doesn’t affect the bottom line, get rid of’. They’re going say ‘we don’t need office space. We don’t need to pay rent.’ Coronavirus is going to change the game.”

Van Camp said it’s hard to predict what kind of businesses will be successful. The deciding factor usually has more to do with the would-be entrepreneur than the business itself. Even those with ideas others think are bad might succeed if they’re tenacious and adaptable, he added.

“We try to make it difficult for them and if they continue to try to move forward and if they say ‘I don’t care what you think. I don’t care if you laugh at me, I’m doing this no matter what’, those are the guys that succeed,” Van Camp said. “We try to make sure they understand all the risks. We try to help them understand there’s no guarantees and they’re probably going to fail. We give them all the stats. For some people it scares them off. That’s a good thing because they would have been scared off during their business endeavor anyway. I’ve seen some things that I thought ‘well that’s a dumb idea.’ Because they didn’t quit, they proved me wrong.”

Veterans interested in starting a business can find resources on the Warrior Rising website at https://www.warriorrising.org.

This article originally appeared on Reserve + National Guard Magazine. Follow @ReserveGuardMag on Twitter.


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National Guard chief says ‘tie goes to the soldier’ in California re-enlistment bonus scandal

The head of the National Guard said Oct. 26 that the Pentagon will continue to investigate re-enlistment bonuses paid to thousands of California National Guard soldiers a decade ago and will force those who wrongfully accepted them to pay the money back.


Chief of the U.S. National Guard Bureau Air Force Gen. Joseph Lengyel said his office is looking into more than 13,600 cases that could be fraudulent, but he admitted investigators have to prove that the soldier knew they were accepting upwards of $15,000 they didn’t qualify for.

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Sgt. Jeffrey Nelan, a Infantryman with the 184th Security Force Assistance Team, California National Guard, plays with Afghan children during a leadership engagement at the Afghan Uniformed Police headquarters in Uruzgan Province, Afghanistan, Sept. 25, 2013. | U.S. Army photo by Cpl. Harold Flynn

“The tie goes to the soldier,” Lengyel said at a breakfast meeting with defense reporters in Washington. “If their hands are clean where this soldier is doing their duty and doing their job, it is not our intent to try to enforce this hardship on them 10 years later.”

A nationwide furor erupted after a Los Angeles Times story revealed the California National Guard was demanding repayment with interest for some bonuses it doled out to its Guard troops as an incentive to re-enlist during the height of the Iraq war. The former head of the  state’s Guard incentive program was later convicted of filing over $15 million in false claims and the bureau began looking into the scope of the problem in 2012.

Some soldiers, the Times story alleges, have been forced to pay pack tens of thousands of dollars to the government after nearly a decade — some who sustained severe injuries during their subsequent deployments and have been financially ruined by the errors.

President Obama weighed in on the scandal Oct. 25 and reportedly ordered the Pentagon to speed up the audits, but he stopped short of asking for a blanket amnesty, the Times said.

Pentagon chief Ash Carter said in a statement the next day that he’s ordered a suspension of the paybacks and has asked his office to establish a more streamlined process to investigate fraud claims and allow Guard soldiers a speedier appeal.

“This process has dragged on too long, for too many service members,” Carter said. “Too many cases have languished without action. That’s unfair to service members and to taxpayers.”

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Guard officials claim over 13,600 questionable bonuses were paid out to California soldiers in the mid-2000s — some for re-enlistment incentives, others for education reimbursement. About 1,100 bonuses were given to soldiers who officials allege were not entitled to them, about 4,000 were error free and about 5,300 had paperwork errors. There are still about 3,200 that Guard officials are still trying to track down.

So far about 2,000 soldiers have been asked to pay back all or part of their bonus cash, Guard officials say.

Lengyel explained some of the more egregious cases included officers who took the cash to re-up when the money was intended to help fill the enlisted ranks, some who took bonuses to stay in certain jobs even though they were already in the process of changing their roles in the Army Guard and others who took re-enlisted bonuses despite being on track to take a slot at officer candidate’s school.

“Was there an intent to trick the system, to take advantage of the fact that apparently there’s some new sheriff in town who’s handing out bonuses?” Lengyel wondered. “Unfortunately with all of this was mixed in some proven intent to defraud the government, in some cases. There was some intent to take money knowingly that you weren’t entitled to by some people.”

But he added that likely the vast majority of soldiers who took the bonuses didn’t have any intent to illegally work the system.

“We think there are a lot of people out there who were 22-year-old soldiers who were given information that they thought by all means they were entitled to the money,” Lengyel said. “They were told they could take this money, they were told that they were entitled to this money, they took the money, the re-enlisted and they went about whatever they were doing and they were given bad data.”

Guard officials say there are more cases of alleged fraud in the re-enlistment bonuses for National Guard troops in other states, but that they pale in comparison to the California errors. Lengyel said in all about $50 million in questionable bonuses were paid out in California during the period, and the Guard is investigating each one individually.

The National Guard is granting exceptions, he added, particularly for those who were paid bonuses without submitting records that they were actually eligible. Lengyel said, for example, a bonus paid out to a soldier that didn’t forward a copy of a high school diploma will likely be given a pass since he couldn’t have joined the Guard without it in the first place.

“That’s a technicality by which this member shouldn’t be levied a fine,” Lengyel said. “The blanket rule is to do the right thing.”

Lawmakers on both sides of the aisle have been outraged by the story, with some already calling for an investigation into the issue and forwarding language to an upcoming defense bill that would give some bonus recipients amnesty. National Guard officials say they did notify Congress of the potential for bonus fraud but nothing was done.

Vet groups have been quick to side with California guardsmen, arguing it’s unfair to put so many soldiers in financial peril due to a former military official’s malfeasance.

“If any of these people were misled about their own eligibility for the bonus with the intent to keep them on, they shouldn’t be held responsible for that,” said John Hoellwarth, National Communications Director for AMVETS. “We think the benefit of the doubt has to be with the soldiers,”

Lengyel said his office is sending investigators to California to help speed up the process of determining whether a bonus or incentive was paid in error in hopes of helping affected soldiers get on with their lives.

“We’re focused on helping those service members who were doing the right thing and served their country and thought they were entitled to a bonus to get this out of their past and out of their way,” Lengyel said. “And we want to help California do that, and help the service members do that as quickly as we possibly can.”

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