Raymond Lott is a decorated combat veteran. He spent 10 years in the Marine Corps as a war reporter and combat photographer. He earned the Combat Action Ribbon and an award for combat photography while deployed in Iraq. He is also a hip-hop recording artist, the CEO of Military Musician Platform, and owner of Ninja Punch Music.
When Lott left the Marine Corp he felt lost. He recalls “thinking why am I here? Why am I doing this?” He started to feel that he didn’t have a purpose. Yet, music was a form of therapy that helped calm the noise in his head.
Lott knew his savings would run out. He needed to get a job. But he spent the last money he had to buy a one-way ticket to LA.
Once in Los Angeles, Lott didn’t have a place to stay and was out of money.
“I was broke. I didn’t have any money. So, my last resort was to go to the VA.”
The VA helped Lott get on his feet and helped him get into school. He eventually started earning money. The VA, Lott recalls, gave him the opportunity to focus on becoming the musician he set out to become. It put him on the path to financial stability. That allowed him the independence to be creative. It was his breakthrough.
Lott learned about the music business. That’s when things started to happen for him. He started posting short music videos on Instagram. The following he gained in those viral posts helped him start making money as an artist. From there he crowdfunded his first album. It was the springboard to building his music business.
Today, Lott publishes albums with other veteran musicians. He says it feels good to share their stories. But it takes money to make music. It takes money to run a business. That’s why having a financial foundation is so vital.
Leveraging the resources of the VA helped Lott gain the financial foundation necessary to build a successful music business. And there are other resources available to veterans. That’s why he offers this advice.
“Whether you’re looking to start a business or just get on your feet financially, those things are available for you. It’s out there. All you have to do is look…”
Some examples include:
1) Veterans Entrepreneur Portal
Offers training and employment programs, and information and access to various resources to start, finance, and grow a business.
2) The Small Business Administration’s Office of Veterans Business Development
Provides training, counseling and mentorship, and guidance on how to sell to the federal government.
3) The National Veterans Foundation
A charity dedicated to advocating for veterans and members of the guard and reserves. Services include crisis management and job referral.
4) Department of Defense Office of Small Business Programs
Provides veterans interested in starting their own small business links to the type of public and private programs that can support those efforts.
“What is your interest rate?” This is the most frequently asked question in the lending world. Without a doubt, personal experience compounded with all of the social media questions prove the point every single day. Because I take an educator-first mindset, it is imperative to explain why this is only one small piece of a much larger puzzle when comparing lenders.
An interest rate can be manipulated to look better than it actually is by throwing on origination fees, processing fees, underwriting fees and points to lower the rate. All of these things mean you are actually paying to have a lower interest rate. The VA regulations allow for up to one percent of the loan amount to be charged by the lender in addition to reasonable discount points. This one percent is outside of the other fees paid to outside parties such as an appraisal, credit report, title examination, title insurance and more. This flat (up to) one percent is specifically designed to cover the lender’s services.
While the VA may allow up to a one percent fee, that doesn’t mean that it is necessary. Many lenders, including myself, will never charge a veteran a fee for doing a VA loan. It’s just not how we envision taking care of each other looks like. Additionally, many financial institutions that typically do charge this fee will occasionally run promotions that eliminate it for a short window of time. It is important to read the fine print when looking up any advertised interest rates, as many will have a disclaimer such as “Rates quoted above require a 1.00% loan origination fee. The origination fee may be waived for a 0.25% increase in the interest rate”.
The origination or other lender fees like in the above scenario are similar to discount points, but are not tax deductible. This is yet another downside of lender fees. Discount points, however, are a tax deductible fee in exchange for a lower interest rate. One point is equal to one percent of the loan amount, and will reduce the interest rate by .25%. Let’s practice some mortgage math on a scenario I pulled up today from an undisclosed lender’s website:
“VA 30 yr fixed loan – Interest rate as low as 3.625% – discount points 2.00
*Rates quoted above require a 1.00% loan origination fee. The origination fee may be waived for a 0.25% increase in the interest rate”
As the disclaimer states, to not pay an origination fee of 1%, the rate goes up by .25%. Now the rate is at 3.625 +.25 = 3.875 … but we still have those two points to deal with!
2 points *.25 each = .5 increase to rate without paying for them. 3.875 +.5= 4.375
That 3.625 advertised rate comes with so many points and fees that it is actually a TRUE rate of 4.375 – a far cry from what was seen on the surface. In a 0,000 home loan, this would make the difference of 9 each and every month if you chose not to pay any of those fees, OR ,000 upfront, out of pocket in addition to the regular closing costs.
Even if you have a motivated seller offering to pay your closing costs, you have a choice to use that money to pay a lender’s fee or you could use that money to buy down points with a lender that doesn’t charge. That 1% lender’s fee could actually be you saving .25% off of the interest rate elsewhere if the seller’s contributions aren’t already maxed out. This is just one way to make your closing cost contributions work for your bottom line instead of your lender’s. All financial matters are based on trust, and this is likely your largest life purchase, so it’s important to be in the know!
Soldiers with over 16 years of service who want to transfer their Post-9/11 GI Bill to a dependent must do so before July 12, 2019, or risk losing the ability to transfer education benefits.
Last year, the Department of Defense implemented a new Post-9/11 GI Bill Transfer of Education Benefits, or TEB, eligibility requirement, which instituted a “six- to 16-year cutoff rule,” said Master Sgt. Gerardo T. Godinez, senior Army retention operations NCO with Army G-1.
Further, soldiers who want to transfer their education entitlement must have at least six years of service, he said. All soldiers must commit to an additional four years of service to transfer their GI Bill.
However, soldiers who are currently going through the medical evaluation board process cannot transfer GI Bill benefits until they are found fit for duty under the new DOD policy.
(U.S. Army photo)
“For Purple Heart recipients, [all] these rules do not apply,” Godinez said.
Prior to the new policy, there were no restrictions on when a soldier could transfer their education benefits.
Since 2009, over 1 million soldiers have transferred their GI Bill benefits, Godinez said.
“To transfer their GI Bill, soldiers have to go into milConnect website, login with their common access card, then select the tab there that talks about the transfer education benefits,” Godinez said.
If a soldier needs additional help, they can visit their installation’s service and career, or education counselors. In July 2019, the new rules will be in effect and those soldiers with more than 16 years of service will not be eligible to transfer education benefits.
“Soldiers need to [review this benefit] to make an educated decision,” he said.
If you received an email advertising a new vaccine for the coronavirus, would you open it? If a doctor called you requesting payment to treat your family member for COVID-19, would you share your information?
While the world is focused on the coronavirus (COVID-19), criminals are taking advantage of the situation.
“We are seeing coronavirus-related phishing attacks and we are seeing them at USAA,” warns Michael Stewart, assistant vice president of information security at USAA. “We are seeing emails advertising alleged coronavirus-related benefits and others from a healthcare perspective.”
Other potential scams include fraudsters pretending to be members of the Centers for Disease Control and Prevention or World Health Organization to obtain personal information or selling fake coronavirus test kits and vaccines that do not exist.
“Fraudsters like to take advantage of these situations,” explains Stewart. “They will leverage the coronavirus and urgency around it to get people to click on things or give up information that they might not otherwise disclose.”
Some additional scams during this pandemic period to be aware of include:
Charity scams: Stay alert of scammers contacting you to donate to fake charities. Research the organization you desire to sponsor to ensure your information is protected.
Product or services scams: Items like hand sanitizers, disinfectants and household cleaning supplies are often offered by scammers who will keep your money. Scammers also offer cures, coronavirus test kits and vaccines that do not exist. Services can range from house cleaning to doctor visits.
Employment scams: Scammers create job ads to lure unemployed consumers to fake jobs. The scammers will wire money or send a fake check to you, asking to send a portion back or use the funds to purchase goods, which are directed back to the scammer
Tips to protect your information include:
Secure your accounts: use multifactor authentication everywhere, especially with banks, phone and email providers. This extra layer of security helps keep you safe.
Stay vigilant: scammers will contact you by phone, email or text offering products, services or humanitarian opportunities. They often pose as credible companies “phishing” for login or personal information Pause to confirm it’s a credible company before proceeding.
Monitor your accounts: stay close to your personal bank accounts, report suspicious behavior and respond to alerts.
Use trusted Wi-Fi networks: as more people transition to work from home, ensuring your Wi-Fi network is password protected is critical to safeguard your information.
The 36 page indictment outlines a massive scheme to defraud the government through a series of kickbacks, money laundering, and medical malpractice.
The feds allege the conspiracy began in 2014 when Richard Cesario and John Cooper founded CCMGRX, LLC (later renamed CMGRX). The premise of the company was to market compounded prescriptions to service members, retirees, and their dependents, documents show.
Compound prescriptions are drugs which are mixed in an effort to provide a unique prescription that meets the specific needs of the patient. They are not approved by the FDA, but may be prescribed when a patient is unable to have a specific ingredient in a drug, or the drug is not available in a specific form, such as prescriptions for children who can’t swallow a pill and must have a liquid version of the medication.
Cesario and Cooper enlisted the help of three marketers, Joe Straw, Luis Rios, and Michael Kiselak, to recruit pharmacies and patients, the indictment shows.
The patients allegedly were oblivious to the scam, instead being told that they were taking part in a medical study being done by an independent non-profit organization, the Freedom From Pain Foundation. The company was operated by Cesario and Cooper, who used the company to launder the money they received from TRICARE, Justice says.
Money was allegedly paid to five different pharmacy owners and two doctors.
After paying beneficiaries for participating in the study, kickbacks were allegedly sent in the form of checks to the doctors, pharmacy owners, and marketers. The rest was pocketed by Cesario and Cooper, the feds say.
More than 30 separate counts were filed against the men, including conspiracy to commit healthcare fraud.
The indictment also outlines some of the punishment the men will face should they be found guilty, beginning with a list of properties in Texas, Florida, and Costa Rica that the men will have to turn over to the government.
Additionally, 32 vehicles, including Ferraris; Maseratis; Aston Martins, Corvettes; Mercedes-Benz; Jaguars; Porsches; Hummers; Cadillacs; BMWs and several trucks and SUVs will be seized by the government upon conviction of any single offense.
The indictment goes on to list multiple boats and recreational vehicles, bank accounts in the names of the men and family members, cash, investment accounts, firearms, jewelry, other property, and “working interest” in several oil companies, as well as a “money judgement” that could all be seized by the government in an effort to recoup the over $100 million scammed by the group.
According to the press release regarding the indictment, Cesario and Cooper, who were placed in custody earlier this year, are being held until trial. The other 10 men all made bail until their trial.
Each of the charges against the men is punishable by between 5 and 10 years, and a $250,000 fine.
The FBI and the Defense Criminal Investigative Service helped investigate and breaking up the alleged conspiracy ring.
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.
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.
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.
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.
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.
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.
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.
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.
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.”
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.”
The business world seems to have realized that veterans make great entrepreneurs. Profiles of vets starting coffee shops, tech support companies, landscaping services, security firms, and a whole host of other businesses appear across the web on a frequent basis these days.
This should not be a great surprise. There are nearly 2.4 million veteran-owned businesses in the U.S., representing almost 9 percent of all businesses nationwide.
And, a study by the Kauffman Foundation, a well-respected entrepreneur support organization, indicates that approximately 25 percent (some say as high as 45 percent) of all active duty personnel want to start their own businesses upon leaving the service.
So, what makes veterans such successful entrepreneurs?
It is finally being recognized that the attitude, training, and skills gained from military service, such as discipline, hard work, a commitment to accomplishing the mission, the ability to both lead a team and function as a member of a team, and, most important, the almost innate ability to immediately pivot from plans that aren’t working to plans that do, are valuable traits that make for a successful entrepreneur.
Indeed, the Kauffman Foundation states that veterans’ “commitment to excellence, attention to detail, strategic planning skills and focus on success are the same traits that make business owners successful.” And, Dan Senor and Saul Singer, in their book, “Start-Up Nation,” say the main reason Israel is one of the most entrepreneurial nations on earth on a per capita basis is the country’s compulsory military service, which creates an environment for hard work and a common commitment to accomplish the mission.
But, even though veterans have received excellent training in the military in the skills necessary to be successful entrepreneurs, not enough younger veterans returning from the Iraq and Afghanistan wars are choosing to start their own businesses. And, we don’t know why.
After World War II, nearly one-half of all returning veterans started their own businesses—but, by 2012, that rate had dropped to less that 6 percent. Even more important, just over 7 percent of all current veteran-owned businesses are started by veterans under 35 years of age. The rest are started by older vets.
This makes some sense. Personnel mustering out of the Armed Forces after 20 years or so have a pension that gives them a financial cushion to take the risk of starting a new business. And, older vets retiring from a traditional job at around 65 years of age, and who are looking for something else to do, would most likely have their house paid off and their kids out of college, giving them the financial means to start a new business without risking their family’s financial future.
But, it is the lack of younger veterans who are choosing entrepreneurship as a viable career path that is the critical issue in veteran entrepreneurship today.
Fortunately, over the past several years, there has been a burgeoning industry that has sprung up to help veterans who want to start their own businesses. Veteran led incubators and accelerators, as well as university and community college programs, government services, online resources, and community-based organizations have all answered the call to help aspiring veteran entrepreneurs realize their dream of owning and operating their own businesses.
While it is not possible to list all of the resources available to help veterans–and, particularly, younger veterans–who want to start businesses, a small sample of these programs in each of the categories mentioned is provided below:
Veteran Led Incubators—Bunker Labs (https://bunkerlabs.org) is probably the best known and most successful veteran led incubator in the country. While headquartered in Chicago, it has expanded to eleven cities around the nation. Its Chicago location is in the 1871 incubator facility, which gives veterans the crucial opportunity to interact with non-veterans who are creating new businesses. The “Bunker in a Box” program (http://bunkerinabox.org) enables veterans who are not near one of its urban locations to get some of the basic tools necessary to start a new business.
Veteran Led Accelerators—Vet-Tech (http://vet-tech.us) is the nation’s leading accelerator for veteran-owned businesses. Located at Silicon Valley’s Plug and Play Tech Center in Sunnyvale, CA, it has an extensive network of financial, government, and management resources to bring a veteran-owned business to its next level of success.
University Programs—Syracuse University’s Entrepreneurial Bootcamp for Veterans with Disabilities (http://ebv.vets.syr.edu) is one of the most extensive programs in higher education for veteran entrepreneurship. This program is offered at eight other colleges and universities around the nation.C
Government Services—The SBA’s Boots to Business program (http://boots2business.org) is an example of the type of program offered by the government to transitioning service members to give them the basics in starting a new business.
Online Resources—VeToCEO (http://www.vettoceo.org) is a free online training program that assists veterans in leveraging their skills to start or buy a business and run it successfully. The American Legion Entrepreneur Video Series () is another no-cost source to give aspiring veteran entrepreneurs at least a basic introduction to starting and running a business.
Veterans interested in starting a business should research what resources are available to them in their local communities, and then pick a program that fits the type of business they are interested in creating.
Given all of the resources that are currently available to veterans interested in starting businesses, what does the future of veteran entrepreneurship look like?
It looks pretty robust.
There are only two cautions that need to be mentioned about support for entrepreneurship initiatives for veterans:
The first is that many of these veteran entrepreneur support programs are relatively new—within the last couple of years, or so. The proof of their efficacy—of their value and worth—will be when they produce long-term, sustainable and profitable veteran-owned businesses—and, by long-term, I mean businesses that are in existence for at least five years, at a minimum. Some of these support programs are so new that not enough time has passed where this can be determined.
The second “caution”, if you will, would actually be a good problem to have. While there is no evidence that this is presently occurring, there could come a time in the future when there are actually more veteran entrepreneur support programs than there are veterans to fill them. This will become evident when these programs begin to admit non-veterans in order to maintain their viability.
But, for now, it’s all “blue skies and smooth sailing” for veterans who want to start businesses and the programs that support them.
Paul Dillon is the head of Dillon Consulting Services, LLC, a firm that specializes in serving the veteran community with offices in Durham and Chicago. For more visit his website here.
While shopping privileges exclude the purchase of uniforms, alcohol and tobacco products, it includes the Exchange Services’ dynamic online retail environment known so well to service members and their families. This policy change follows careful analysis, coordination and strong public support.
“We are excited to provide these benefits to honorably discharged veterans to recognize their service and welcome them home to their military family,” said Peter Levine, performing the duties for the under secretary of defense for personnel and readiness.
“In addition, this initiative represents a low-risk, low-cost opportunity to help fund Morale, Welfare and Recreation programs in support of service members’ and their families’ quality of life. And it’s just the right thing to do,” Levine added.
The online benefit will also strengthen the exchanges’ online businesses to better serve current patrons. Inclusion of honorably discharged veterans would conservatively double the exchanges’ online presence, thereby improving the experience for all patrons through improved vendor terms, more competitive merchandise assortments, and improved efficiencies, according to DoD officials.
“As a nation, we are grateful for the contributions of our service members. Offering this lifetime online benefit is one small, tangible way the nation can say, ‘Thank you’ to those who served with honor,” Levine said.
NOW WATCH: Pentagon considers lifetime access to Exchange system for vets
The Air Force has just escalated its response to efforts by the airlines to hire away military pilots. They’re throwing huge retention bonuses to the pilots and boosting flight pay to $1,000 a month.
According to a report by BreakingDefense.com, the flight pay boost will add an additional $1,800 a month to the paychecks of officers. Enlisted men will see their flight pay go from $400 to $600 a month, a 50 percent increase, and taking their pay up $2,400 a year.
“We need to retain our experienced pilots and these are some examples of how we’re working to do that,” said Secretary of the Air Force Heather Wilson in an Air Force release. “We can’t afford not to compensate our talented aviators at a time when airlines are hiring unprecedented numbers.”
In addition to announcing the increased flight pay, Secretary Wilson announced the creation of an “Aircrew Crisis Task Force” under Brig. Gen. Michael G. Koscheski. This task force’s formation is a sign that the pilot shortage the Air Force is facing has not improved. The Air Force release noted that at the end of Fiscal Year 2016, the Air Force was short 1,555 pilots overall, including 1,211 fighter pilots.
The Air Force is looking to bring back 25 retired pilots to fill staff positions through the Voluntary Rated Return to Active Duty program, allowing pilots who are still current to be returned to front-line duties. The staff positions are non-flying, but retired pilots could have sufficient expertise to handle them.
This past June, the Air Force increased its Aviation Bonus cap from $25,000 a year to $35,000. These bonuses are paid to pilots who commit to stay past their service commitment for up to nine years.
The Air Force was also seeking to reduce the number of non-flying assignments for pilots, including headquarters positions and developmental opportunities. The Air Force is also trying to reduce additional units and add more flexibility for Airmen with families and children.
The Department of Defense says the service branches aren’t spending enough taxpayer dollars to fund their morale, welfare, and recreation (MWR) programs, according to a memo sent to each of the services last month.
Military Times reported this week that Todd Weiler, assistant defense secretary for manpower and reserve affairs, sent the memo to each branch to remind them that they were responsible for using a specific percentage of taxpayer funds to operate MWR programs.
“These standards are not optional and are not subject to Military Department waiver,” Weiler wrote.
MWR programs are required to receive a percentage of funding from Congress through either appropriated funds or non-appropriated funds, or a combination of the two.
The DoD requires that programs determined to be “Category A” must receive 85 percent of funding from taxpayer dollars. “Category A” are considered “mission sustaining programs” and “promote the physical and mental well-being of the military member,” according to Military One Source.
“Category B” requires 65 percent of operational costs to come from taxpayer dollars. Those programs consist of community support programs like child development centers, which charge families for use and therefore get some funding from customers.
“Category C” are programs that are nearly fully self-funded and include golf courses, base clubs, and recreational lodging. These programs are authorized some limited appropriated funds.
Weiler had previously sent a memo in June to remind the services to return their feedback on MWR funding by August, but both the Army and the Navy missed their deadlines.
Rather, the Army decided to cut $105 million from MWR funds, and the Navy only sent feedback on its Category A funding.
“I thought we needed to up our communication,” Weiler said in response to the Army’s planned slashing of the MWR budget.
The executive director of The National Military Family Association, Joyce Raezer, told Military Times that, due to budget cuts, sequestration, and changes to various other budgetary items, she believed families didn’t expect much from the services. “There are too many other worries,” she said.
Of the services, only the Marine Corps did not meet the 85 percent requirement, coming in at 77 percent of Category A program expenses funded by taxpayer dollars.
Every service fell short of utilizing the required percentage of taxpayer funding for Category B programs.
Weiler called out the Air Force specifically for not having met the requirements for four straight years, with no plan in place to correct the issue.
In the memo sent to the Army, Weiler asked Army Secretary Eric Fanning to halt the planned $105 million cut, a plea that was accepted and approved by Fanning. The Army plans to complete an analysis of its MWR programs and funding later this year.
Military.com reported that Colonel James Love told them that the $105 million cut would go into effect once the Pentagon approved the Army’s requested changes. He blamed a lack of “good business” practices, such as not raising prices for MWR programs, for the decision to cut the Army MWR budget.
“It’s good for families,” Love told Military.com. “But it’s not sustainable.”
The Pentagon announced yesterday that they had met Defense Secretary Ash Carter’s deadline of January 1 to set up a streamlined system to recover bonuses they had accidentally paid to thousands of California National Guardsmen several years ago.
Late last year, Carter ordered the suspension of efforts to recover the funds from soldiers until a system could be set up to fairly recover the bonuses.
Peter Levine, acting as the undersecretary for personnel and readiness, headed up the team to develop the recovery system. Levine spoke to reporters during the press conference, admitting that, though some of the Guardsmen might have made mistakes, “sometimes the service does” as well.
Levine said he had worked with the National Guard Bureau, the Army Audit Agency, the Army Review Boards Agency, and the Defense Finance and Accounting Service (DFAS) to develop the system, and that part of that system involved screening each case to determine if there was even enough information to pursue a resolution.
Cases that are determined to have enough information will go before the Army Board for Correction of Military Records, and Guardsmen will have an opportunity to make their cases then.
There are currently about 17,500 cases up for review which have been separated into two categories.
If you sit down at your computer and search for, “Help with PCS,” you will find dozens of articles telling you what to do. Heck, the military even hands your spouse a list that says, “DO THIS.”
This is not one of those lists.
Instead, this is a list to help you de-crazy your brain in those weeks leading up to the Big Move. This is a list that reminds you that everything that needs to get done will, in fact, get done.
And, if it doesn’t? It probably wasn’t that important to begin with.
1. Do Not expect to de-clutter, organize and label every aspect of your life before the movers come.
We have big plans to separate and label all of the junk we aren’t willing to part with this time around, and we may even purchase the storage bins as a proactive move. But, let’s face it. Moving day comes at lightning speed, and you end up lugging all those loose pictures you planned to consolidate into albums. Try again next PCS.
2. Do Not become too attached to those expected dates for your Household Goods to arrive.
Riiight, 5-10 business days? Try two weeks, or a month. Or, half of it within three days, and the other half in six months after they locate it. The point is, bring enough clothes, enough toys and at least one pot for making macaroni and cheese with you to the new duty station, and you’ll survive until the movers get here. … Whenever that is.
3. Do Not bother doing all your laundry before they pack up the house.
If you plan on driving to the next duty station, toss the laundry basket of dirty clothes in your car and finish it while you sit in temporary lodging. Trust me, you’ll need something to do while you’re waiting for your spouse to out-or in-process. Candy Crush gets boring after a while.
4. Do Not plan too many activities the week of moving day.
You will be stressed out, you will be overloaded, and you will already be racking your brain to think of the million and one things you’re probably already forgetting. Plan your last Girl’s Night Out, or your kiddos last play dates the week before, and reserve those final days for the last-minute-details that always seem to pop up.
5. Do Not assume the movers will know not to pack certain things.
Even obvious things like trash, car keys and cat litter boxes. And, if they don’t have a problem packing cat feces, they’re for sure going to assume your child’s favorite stuffed animal that they tossed on the floor — the one that they have to sleep with or the world falls apart — is fair game. So, if you don’t want them to pack it, my best suggestion would be to take open a safety deposit box at the bank and keep all of the stuff you want to take with you in it. I assume that will prevent them from finding it, but no guarantees.
6. Do Not get hung up on what the movers put in which boxes.
As long as it all generally goes in the same room—or floor—of the house, just call it good. You’ll run yourself ragged trying to micromanage an entire house move, and annoy the movers at the same time. Remember, happy movers mean the potential for less damaged items.
7. Do Not sweat the small stuff.
That first PCS will make you crazy as you balance trying to clean out base housing to the housing office’s satisfaction and feeling helpless watching as the packers touch every single item of your personal effects and pack it away for who-knows how long.
A PCS only comes around … well, to be honest, they come around pretty often, which is why a “don’t” list is something we all need. Do Not fret; you learn something from each move, and by the time you make your final one, you’ll be a pro.