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Top 9 VA Loan benefits

So, you’ve been told that you should use your VA Loan for your home purchase, but the question is: Why? In this post, we’ll talk about some of the benefits and advantages of using your VA Loan for your home purchase.

Benefits of the VA Loan

1. No Down Payment

The VA Loan does not require a down payment for an eligible property purchase. While a 20% down payment on a conventional loan would be difficult for most service members, the VA Loan enables borrowers to put down 0% to buy a home. As of January 2020, there is no cap to a first-tier VA Loan-making it even better! Remember, though – there are still closing costs involved – even if there’s no down payment, so make sure to budget those in when considering a home purchase!

2. No PMI

While other types of mortgages usually require Private Mortgage Insurance for a lower down payment, the VA loan does not require it. This means less money out of pocket for borrowers and is yet another benefit of using your VA loan.

3. Lower Interest Rates

VA Loans are continuously competitive in their mortgage interest rates. By using a VA Loan, you’re almost guaranteed to receive a better rate than other types of loans.

4. Refinance Opportunities

VA Loan borrowers have two types of refinance options. The VA IRRRL can reduce your interest rate and possibly lower your monthly payment. Then, there’s the VA Cash-Out option that can give you the opportunity to pull cash out based on how much equity is in the property. By doing this, you can use the cash for purchases like renovations or repairs, car purchases, or whatever you need!

5. Advocacy

If you happen to be facing foreclosure, the VA has a loan program that provides foreclosure avoidance counseling and advocacy. These counseling programs help find possible alternatives to foreclosure to save you from a low credit score and heartache.

6. Lower Closing Costs

The VA limits closing cost amounts from lenders who offer VA loan lending. Unlike other types of mortgages, you won’t have to worry about outrageous closing costs where you have to bring a large amount of cash to the closing table. To add to the benefit, the VA also allows up to 4% of the buyer’s closing costs to be covered by the seller – saving you even more money.

7. VA Loan Assumability

Loan assumability is a big benefit to a VA Loan. Because the loan is assumable or transferred to a new borrower, a new eligible buyer could take advantage of a lower interest rate than what is currently offered in the mortgage market. Having the ability to advertise your VA Loan as “assumable” may even help sell your home when the time comes!

8. No Prepayment Penalty

If you are required to PCS, sell the home, or decide to pay off the mortgage, there’s good news! There is no prepayment penalty on a VA Loan. That is yet another reason why using a VA Loan could save you money in the long run. The last thing you need to worry about is paying MORE money when you need to pay off your mortgage!

9. VA Loans are Government-Guaranteed

Another advantage of a VA Loan is that it is backed by a government agency. What does this mean? It means that the federal government guarantees to pay back 25% of every VA Loan regardless of the reason for default. Because this provides participating lenders with a less risky situation, lenders can offer better term agreements to borrowers.

Need More Information?

If you’d like to know more about available VA Loan programs, ADPI has you covered! Our in-house lending team, AmNet is here to help you with the VA Loan process. To speak with one of our awesome loan officers, you can fill out our inquiry form here: https://www.activedutypassiveincome.com/real-estate-agents-and-lenders

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

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The military pay raise for 2017 might be a bit underwhelming

The U.S. military has a reputation for being overworked and underpaid.


But we all knew that going in.

The virtue of service and pride of wearing the uniform makes up for much of the disparity in pay compared to the civilian market. Still, it’s nice to get that bump in our paychecks every year.

Yet, the pay increase for 2017 won’t be so big. In an August 2016 letter to Congress, President Obama announced a 1.6 percent raise for the armed forces, consistent with the budget he sent to The Hill earlier in the year.

4 simple ways to start saving money
(White House photo)

Across-the-board pay increases for other federal employees will be 1 percent.

“These decisions will not materially affect our ability to attract and retain a well-qualified Federal workforce,” Obama said in his letter to Congress.

Pay raises for the military peaked in 1983 when President Reagan instituted a 14.3 percent pay raise. Since then, the increase hovered steadily between 3 and 5 percent, with an average of 4.2 percent, according to the Congressional Research Service.

4 simple ways to start saving money
Military pay raises since 1977.

According to Military.com’s Brendan McGarry, the Senate backs the President’s proposed numbers, but the House of Representatives was looking for a 2.1 percent raise.

When Congress agrees on how much it will be, the military pay raise will go into effect on January 1, 2017.

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This Marine just saved the government $15 million

The Marine Corps was paying $60,000 more than it was supposed to for a type of radio cable since 2007, according to Stars and Stripes.


The cable was discovered to be overpriced in October 2016, when Marine Cpl. Riki Clement had to fix a radio. After being told that the needed parts would take six to eight months to arrive, he decided to reverse engineer a replacement using old parts and found out its true cost was actually closer to $4,000.

Later that month, the Marine Corps said the corporal had saved the government $15 million.

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The cable that the Marine Corps was overpaying by $60,000. (U.S. Marine Corps photo)

The defense contractor that makes the cable, Astronics, had been charging $64,000 for each cable. Astronics did not immediately respond to request for comment.

“There may be a good reason for the price, but based on us taking apart the cable and researching the individual parts, we’ve found no reason for this part to cost as much as it does,” Clement told Stars and Stripes in December 2016.
The overpriced cable was one of six in the same parts catalog, Barb Hamby of Marine Corps Systems Command told Stripes.

“The catalogued mistakes were made nearly seven years ago,” Tony Reinhardt, the command’s team lead for automatic test systems, told Stripes. “We went through every [item] in the kit to confirm the prices and fix the errors.”

Reinhardt said the cable costs $4,000 because of the material that goes into it, as well as the process of designing, developing and manufacturing it. He added that there’s no record of the Marine Corps ever purchasing individual replacement cables. The originals were part of kits, and Marines had been using parts from other kits for repairs.

The cost of each kit was $21,466, Capt. Frank Allan, a project officer at Marine Corps Logistics Command, told Stripes.

This isn’t the first time the military has been caught overspending.

In December 2016, it was discovered that the Pentagon had buried a study from late 2015 exposing $125 billion in administrative waste. President Donald Trump has also attacked defense contractors for overpriced weapons, despite recently calling for a $54 billion boost in defense spending.

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Here’s how to join the 2.4 million vets who own their own businesses

4 simple ways to start saving money
(Photo:DVNF.org)


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
  • Community Colleges—Community colleges around the nation offer veteran entrepreneurship courses and programs, typically through their small business development centers. Wake Tech Community College in North Carolina offers a Veterans Entrepreneurship Advantage Course (http://www.waketech.edu/programs-courses/non-credit/build-your-business/entrepreneurship-initiatives) that is representative of these types of programs.
  • 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.
  • Community-Based Organizations—SCORE, the Service Corps of Retired Executives, is an example of a community-based organization that is supporting veteran entrepreneurs with their Veteran Fast Launch Initiative (https://www.score.org/content/veteran-fast-launch-initiative).

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.

4 simple ways to start saving money
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.

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Veterans clap back at those demanding Starbucks hire 10,000 vets

Starbucks Armed Forces Network, a private group within the company of Starbucks, released a statement yesterday asking that those calling for Starbucks to hire 10,000 veterans instead of refugees check their facts.


Recently, Starbucks came under fire for announcing that they would hire 10,000 refugees. The general reaction was anger and calls for boycotts of Starbucks until they vowed to also hire 10,000 veterans.

4 simple ways to start saving money
Devin Craig (second from right), a district manager for Starbucks Coffee Company, Wash., and his team talk to Soldiers and Veterans during the Boots 2 Work Military Career Fair at Cheney Stadium, Tacoma, Wash., Aug. 27. The career fair gave Soldiers the opportunity to meet with local businesses and learn job hunting skills. (U.S. Army photo by Sgt. Cody Quinn, 28th Public Affairs Detachment/Released)

The problem with that? Starbucks vowed to hire 10,000 veterans in 5 years way back in 2013. And they’re ahead of schedule.

One of the many internal groups at the coffee giant, Starbucks Armed Forces Network, penned a note to their customers to explain why the anger at the refugee program was misdirected.

The note, simply signed by The Men and Women of Starbucks Armed Forces Network (AFN), began, “We write to you today as representatives of the thousands of veterans and spouses who currently work for Starbucks Coffee Company.”

The writers went on to express their gratitude to their customers and then they moved right into addressing the refugee and veteran initiatives.

“The false and inaccurate statements [about the veteran hiring initiative were] deeply troubling to those of us who’ve served,” the group wrote.

The statement described how the CEO and his wife, Howard and Sheri Schultz, had visited military installations around the country to learn more about how they could advocate better for veterans and military spouses after announcing the veteran hiring initiative in November 2013. The couple invested their own personal funds into “plans for transitioning service members,” according to the group.

“We respect honest debate and freedom of expression,” the statement read. “But to those who would suggest Starbucks is not committed to hiring veterans, we are here to say: check your facts. Starbucks is already there.”

The 5 year initiative has only used about 60 percent of its time, but has met 88 percent of its goal. This means that, if they continue at this rate, Starbucks will surpass their initial goal of hiring 10,000 veterans by 2018 by 4,600 veterans.

Starbucks operates 32 Military Family Stores near several major installations. Owned by veterans, military spouses, or family members, the stores participate in “Military Mondays.” Weekly, Starbucks partners with local Veteran Service Organizations to provide space for the organizations to offer pro-bono legal support and other services to the military community.

The company also offers Military Service Pay to employees who have to report for National Guard or Reserve assignments. Eligible partners can receive up to 80 hours of paid time to fulfill their reserve service obligations yearly.

Starbucks provides a Military Allowance to eligible employees that are called to active duty, as well.

Starbucks has made a name for themselves as a veteran friendly company, even being awarded Gold status by G.I. Jobs in this year’s annual “Military Friendly” list.

MIGHTY MONEY

Why these female veterans will never struggle for work again

Female post-9/11 veterans are the fastest growing demographic within the veteran population, but they’re also the greatest risk of experiencing homelessness after their service ends. Just like their male counterparts, they experience all the financial trappings that come with leaving the military. As of this writing, the national unemployment rate stands at 3.9 percent and is falling. But for female post-9/11 vets, unemployment is a solid 5.5 percent.

That’s why the Institute for Veterans and Military Families at Syracuse University decided to change all of that — by showing women veterans how to start their own businesses and never have to look for a job again.


Female vets are a valuable, knowledgeable part of the workforce. More than half of transitioning women have a college education and are twice as likely as men to have a background in science, technology, engineering, or math career fields. Despite this, many women have difficulty transitioning to civilian life and navigating their benefits, taking up to three months longer than male counterparts to find a job once they leave the service.

With this in mind, Syracuse University’s Institute for Veterans and Military Families launched its premiere entrepreneurship training conference, Veteran Women Igniting the Spirit of Entrepreneurship (V-WISE), with the help of the U.S. Small Business Association. It helps female veterans and military spouses find their passions and teaches them the skills they need to turn passion into a profitable business venture in just three phases.

4 simple ways to start saving money

65 percent of these women will start businesses after the V-WISE conference and 93 percent of those will still be in business five years later.

(Institute for Veterans and Military Families)

Phase I of the V-WISE program is a 15-day online learning experience designed to teach participants the “language of business,” how to understand opportunity recognition as it relates to growing a sustainable venture, and present actionable strategies related to new venture creation.

The conference phase of the V-WISE experience is a three-day training offered to cohorts of 200 women at locations across the country. Participants must complete Phase I before attending Phase II.

The conference includes more than 20 distinct modules of training (representing over 40 hours of coursework) designed for both new business owners and to support the needs of existing ventures. Topics addressed include business concepts, financing, guerrilla marketing, human resources, legal challenges, profit models, and more.

Phase III, V-WISE Biz Support, provides program graduates with technical assistance to start and grow their business. Graduates will have access to incorporation services, financing services, mentorship, and opportunities for further education and skill-building with the IVMF and its partners, often at a reduced or waived cost. These services are available through a password-protected website.

And the system works. The V-WISE program is only six years old and has many of the three-phase programs under its belt but can boast more than 3,000 entrepreneurs — 93 percent of whom are still in business to this day. On Sept. 14, 2018, the Institute for Veterans and Military Families will host its 20th event in San Diego, Calif., where the slate of speakers will include:

  • Remi Adeleke, Transformers actor and former Navy SEAL
  • Angie Bastian, Co-Founder of Boom Chicka Pop Popcorn
  • Larry Broughton, Co-Founder and CEO of BROUGHTONadvisory and Founder and CEO of broughtonHOTELS
  • Neale Godfrey, founder and CEO of Children’s Financial Network
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The V-WISE class in Phoenix, Ariz. in 2017.

(Institute for Veterans and Military Families)

The V-WISE conferences are open to all women veterans, active duty female service members, and female partners/spouses of active service members and veterans who share the goal of launching and growing a sustainable business venture. It is just one of a slate of eight national entrepreneurship programs and three resources offered by the Institute for Veterans and Military Families — a slate the IVMF calls, “The Arsenal.”

Syracuse University’s Institute for Veterans and Military Families is the first interdisciplinary national institute in higher education focused on the social, economic, education and policy issues impacting veterans and their families post-service. Its dedication to veteran-facing programming, research and policy, employment and employer support, and community engagement allows IVMF to provide in-depth analysis of the challenges facing the veteran community.This one-of-a-kind dedication to the military-veteran community creates real, sustainable changes in the lives of military veterans, as showcased by the successful women who have graduated from the V-WISE program.

To learn more about the V-WISE program and learn how you can be in the next cohort, visit the V-WISE website.

MIGHTY MONEY

4 tips for buying your first car as a junior troop

Purchasing your first car is a minefield filled with predatory lenders and scams. Young troops, unfortunately, fall victim to these bloodsuckers every year because they do not know of the special offers and protections available to them. It’s exciting to be on the lot, test driving your potential steed, but knowing the pitfalls that lurk in those lots will save you and your wallet a lot of grief.

It’s your first car and having your finances accounted for will make it easier when the additional expenses of maintenance, insurance, gas, and registration come into play. You wouldn’t go into battle without ammunition and you should equally not venture onto a lot without knowing your credit score, pre-approval amount, and potential financial threats.

Here are 4 tips for identifying and preventing scams targeting you, a junior troop, as you shop for your first car.


4 simple ways to start saving money

The “refusing pre-approved checks” scam

You found it. It’s the perfect car to take you from base to places where knife hands and regulation haircuts do not exist, but there is one problem: the dealer doesn’t want to accept your pre-approved check from your lender (bank). They may try to spin something along the lines of, “I don’t trust those, I’ve been scammed before.” They’re playing the victim; don’t believe them. Their next move will be to convince you to sign a financing agreement with them instead, effectively scamming you into a higher APR loan.

Walk off that lot and never look back. You don’t need that evil put on you, Ricky Bobby.

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The “you have bad credit” scam

As a young troop, you probably don’t have a credit history at all, which is a double-edged sword. The positive is that lenders will give you the benefit of the doubt. Why? Well, because of your service, you’re easy to find and collect from if you become delinquent on payments. So, if a dealer says you have bad credit when you know, for a fact, that you don’t, it’s another scam waiting to happen.

We’re willing to bet that the dealer will tell you your only option for approval is to finance through them at a ridiculously high rate. The solution here is the same as before — walk.

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The “buy here, pay here” financing scam

In this scam, the dealer will promise that you’re going to get a sweet APR if you finance through him, but the application process takes a few weeks. He’s a nice guy, though, so he’ll let you take the car home while everything finalizes. He’s trusting you, but then, once those weeks pass, he calls you with bad news: the loan was denied, and you’re forced to pay a much higher APR or lose that car.

The best defense against this scam is shop around for different lenders, get pre-approved, and don’t accept any unknowns. Do not let dealers talk you into something you’ll regret later. Not all “buy here, pay here” offers are scams, but why take the risk when the alternative is clear as day?

The “price is too good to be true” scam

There are advantages to buying directly from a person instead of a dealer, like a faster turnaround or a better deal. But keep your head on a swivel because you’ll also leave yourself open to other risks and scam artists. As always, if in doubt, bring a friend. With some information and a properly calibrated BS meter, a troop can venture into the unknown unafraid.

The ‘price is too good to be true’ is when a victim sees a car they want to purchase online and it’s priced well below market value. Usually, it’s a classic or an exotic car — something to entice the victim to overlook a few details. The scam artist states that they’re out of the country with the vehicle (for one reason or another), but they’ll ship the car to you — but only after they receive your payment. The scam artist will make it seem like they’re the one at risk.

Once the scammer receives your money, they will cease speaking to you and disappear. Surprise!

The lesson here? Always make purchases in person and be wary of wire transfers and money orders. And, as always, if it sounds too good to be true, it is.

If you feel like you have fallen victim or see a scam targeting your brothers-in-arms, you can report the car-buying scam at Fraud.org

MIGHTY MONEY

Tips for budgeting for the holidays

As the holidays get closer, many military families find themselves looking for ways to save money and budget appropriately for the upcoming gift-giving season. Random COVID-19 impulse buys, a downward spiraling economy, job loss, and purchases related to new homeschooling or virtual schooling curriculum are leaving many of us financially stressed in 2020. Check out these holiday budgeting tips that will help you start the new year off on the right financial footing.

Tips on budgeting for the holidays

So how do you try to save and budget for this holiday season when your finances may have taken unexpected hits because of the coronavirus pandemic? Financial expert and military spouse Lacey Langford from The Military Money Expert says there are three things you should evaluate when you start budgeting for the holidays: your current holiday savings, the total amount you want to spend for the holidays, and who is on your list. 

“Knowing how much you have to spend is the jumping-off point for your budget,” Langford said. “Then you can look at [ways to save] between now and Christmas.”

You will also want to examine how much you want to spend for the holidays. You can do this by looking at your current savings account balance. Subtract the amount you want to keep in savings as your emergency and investment amounts to find your total holiday shopping budget. Once you have that number, you can write down the people on your holiday shopping gift list, and assign each person an amount of money you would like to spend on them. “[When you] know who you’re buying for it makes it easy to firm up your spending budget,” says Langford. 

“Save money every month, starting in January. … Set up an automatic $100 transfer from your checking to your savings at the beginning of the month. By the time November rolls around, you’ll have $1,100 to holiday shop with,” Langford suggests. 

But don’t fret — if you aren’t that organized with your holiday budgeting this year, you can still do some things to help you save some cash for the next several weeks: 

  • Don’t procrastinate: Shop sales when you see them. You can even do this throughout the year.
  • Use apps like Qube Money that utilizes the popular envelope system or Tiller that helps you budget throughout the year.
  • Cancel your cable or streaming services.
  • Honey and Rakuten are two websites that offer cash back for purchases made on other sites — even Amazon, Wal-Mart, and Target participate

“Don’t forget to use your military benefits when shopping for the holidays,” Langford said. 

Shop My Exchange, ID.Me Shop, and GovX are all military-specific and provide discounts or lists of companies that give military discounts online. 

The military exchanges also offer a new layaway program as well. Layaway not only helps you pay for what you can manage in a certain timeframe but also allows you to stick to your monthly budget. There are several different options for layaway, from 30 days for clothing and handbags up to 120 days on fine jewelry. A deposit purchase of $25 and 15% of the item’s purchase price, plus service fees are required to put your items on layaway at any military exchange. You can find out more information by visiting the Exchange website

Even if your family is in a good place financially, you should start considering your holiday budget about 6-8 weeks using the funds you have saved away throughout the year. Budgeting is a great way to keep your family on track, make sure your nest eggs continue to thrive, and help your family prepare for the unexpected — like a worldwide pandemic. 

Want more money tips? Download our free 2020 Military Money Guide

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

MIGHTY MONEY

5 GI Bill rates that will increase this year

The Department of Veterans Affairs has announced the Post-9/11 GI Bill rates for the 2019-2020 school year. These rates will be effective on Aug. 1, 2019. The Montgomery GI Bill and Dependents’ Education Assistance programs will see a rate change on Oct. 1, 2019.

By law, the GI Bill rate increase is tied to the average cost increase of undergraduate tuition in the U.S. For the 2019-2020 school year, that increase will average 3.4%.

More than 80 percent of those taking advantage of their GI Bill benefits are doing so through the Post-9/11 GI Bill.


Private & foreign school GI Bill rates

Effective Aug. 1, 2019, those using the Post-9/11 GI Bill at a private or foreign school will see their maximum yearly GI Bill rate increase from ,671.94 to ,476.79.

Flight training

Those who are enrolled in flight schools will see their annual maximum GI Bill benefit increase from ,526.81 to ,986.72.

4 simple ways to start saving money

An F-22 Raptor from the Hawaii Air National Guard’s 199th Fighter Squadron returns to a training mission after refueling March 27, 2012, over the Pacific Ocean near the Hawaiian Islands.

(U.S. Air Force photo by Tech. Sgt. Michael Holzworth)

Licensing/certification/national testing

You can be reimbursed up to ,000 per test for licensing and certification tests. For national testing programs, there is no maximum amount of GI Bill reimbursement. Your entitlement will be charged one month for every ,042.06 spent; currently, that trigger point is id=”listicle-2634152786″,974.91.

Correspondence courses

You can be reimbursed the actual net costs, not to exceed ,888.70 annually. That’s up from ,497.78 currently.

Monthly housing allowance

The Monthly Housing Allowance is also scheduled to change on Aug. 1, 2019.

If you are attending classroom sessions, your housing allowance is based on the ZIP code of the campus location where you attend the majority of your classes.

If you are attending classes at a foreign school, not on a military base, your maximum housing allowance will be id=”listicle-2634152786″,789.00. This is prorated based on the length of your active-duty service and how many classes you are taking.

If you attend all your classes online, your maximum housing allowance will be 4.50. This is also prorated.

Keep up with your education benefits

Whether you need a guide on how to use your GI Bill, want to take advantage of tuition assistance and scholarships, or get the lowdown on education benefits available for your family, Military.com can help. Sign up for a free Military.com membership to have education tips and benefits updates delivered directly to your inbox.

This article originally appeared on Military.com. Follow @militarydotcom on Twitter.

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Pentagon to pursue bonuses mistakenly paid to Guardsmen

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Pentagon Press Secretary Peter Cook updates reporters about the California National Guard bonus repayments at the Pentagon in Washington D.C., Jan. 3, 2017.


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.

Also read: Gary Johnson speaks out on California Guard repayment scandal

The first category consists of roughly 1,400 cases where the Guard has determined that recoupment should happen, and they have been referred to DFAS for collection of those funds.

Levine said that he expected to see half of those debts forgiven.

For the remaining approximately 16,000 cases, Levin anticipated about 15,000 not meeting the criteria for pursuit.

The other thousand cases, according to Levine, will go through the same process as the 1,400 currently referred to DFAS.

In all, he said, he expects “fewer than 1,000” of the cases to go before the Board of Correction of Military Records.

Levine believes that the Board of Correction of Military Records will be able to hear all of the cases by July — the deadline set by Carter.

MIGHTY MONEY

Six things to consider with the new payroll tax deferral

More than a million service members had an increase in their September mid-month pay because of the payroll tax deferral program set forth by President Trump. The presidential memorandum directs employers to stop withholding payroll tax until the end of the year to “support working Americans during these challenging times.”

While most civilian companies have declined to implement this directive, the federal government has given service members and civilian employees who make less than $4,000 biweekly or less than $104,000 annually no way to opt-out.

So how does this affect you and your family?


Six things military families might want to consider with the new payroll tax deferral

You will see a boost in pay – but there’s a BIG catch.

For those who are eligible, pay will go up 6.2 percent, which is the amount of payroll tax that is normally paid on wages. This raise in pay will continue through December 31, 2020.

The potential pitfall will come in the new year, between January and April 2021, which is when the taxes that are currently being deferred are slated to be paid back, possibly by taking out twice the normal payroll tax amount each pay period.

The payback will come at a particularly bad time, since most families struggle in the first few months of the new year, while holiday spending bills come due and they wait for their tax refunds.

Do you invest in the TSP, an IRA, or a 529? You may get a nasty surprise in January

While I am a big proponent of automatic investing through payroll deduction or bank transfer since it allows you to “set it and forget it,” this is one instance where a good savings habit could potentially trip you up.

But service members (and their bank accounts!) may be in for a shock if they have their “usual” contributions to the TSP and other investments withdrawn from their pay in January and then have the additional payroll tax deducted as well.

The annual pay raise may offset some of the pain, but it’s not confirmed yet

The proposed defense authorization bill would give service members a 3 percent pay increase in 2021, so this could help ease the pain of paying back extra payroll taxes next year. However, the final bill has not yet been passed by Congress.

Adjusting withholding doesn’t help.

There has been some talk on the internet about adjusting withholding taxes to somehow make up for the payroll tax. This is not a great solution, since the two taxes are not the same. If you increase your withholding, that’s going toward your future income tax bill, not payroll taxes, so it won’t offset January’s tax payback.

If you overpay in withholding tax, you will have to wait until you file income taxes to recoup it.

Save the extra, and save yourself some pain next January

The easiest way to make sure that repaying the deferred payroll tax isn’t a painful experience is to set the extra money aside. The DFAS website says that military members can estimate their payroll tax by taking their monthly base pay and multiplying it by .062 and repeating that process for the four months that the tax is deferred, September through December.

This money can then be saved in a separate, yet easily accessible account. Unfortunately, interest rates are currently very low, so you won’t earn very much interest in such a short time, but at least the money will be available early next year, when it’s due to be repaid.

Getting out? You still have to pay it back

Retired pay is not affected, since it is not earned wages. If a service member leaves the military before the taxes are repaid, they are still on the hook for repayment. Failure to repay these taxes in a timely manner may result in penalties and interest fees.

While it’s possible that service members won’t be required to repay the deferred tax, it’s best not to count on that: it would take action by Congress in order to do that. But if you’ve set aside the funds already, and it turns out that the amount is forgiven, then you will be well on your way to establishing an emergency fund or adding to your existing savings.

DFAS has a dedicated page on the Social Security Payroll Tax deferral. If military families have more questions or concerns, they should contact their installation financial readiness personnel or Military OneSource.

For more savings strategies and inspiration, follow us on social media and visit militarysaves.org and take the Military Saves Pledge, the start of your own personal spending plan.


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

MIGHTY MONEY

Guard to see changes in GI Bill transfer benefits

Provisions allowing Guard members to transfer some or all of their Post- 9/11 GI Bill benefits to their spouse or children are set to change, limiting the timeframe soldiers and airmen can transfer those benefits.

“You have to have a minimum of six years [in service] in order to be eligible to transfer benefits, and after 16 years you’re no longer eligible,” said Don Sutton, GI Bill program manager with the Army National Guard, describing the changes set to go into effect July 12, 2019.

The six-years-of-service rule isn’t new, said Sutton.


“You’ve always had to have a minimum of six years of service in order to transfer your Post-9/11 GI Bill benefits,” he said, adding the big change is the cutoff at 16 years of service.

“You’ll have a 10-year-window in which to transfer benefits,” he said, stressing that Guard members won’t lose the benefits after 16 years of service, just the ability to transfer them to their spouse, children or other dependents.

4 simple ways to start saving money

Soldiers and airmen from the Arizona National Guard.

“The Post-9/11 GI Bill and the transfer of benefits are two entirely different and separate programs,” said Sutton. “Even though soldiers may be ineligible to transfer benefits, they still have the Post-9/11 for their own use.”

For those interested in transferring their benefits, an additional four-year service obligation is still required.

“The [transfer of benefits] is a retention incentive,” said Sutton. “It’s designed to keep people in the service.”

Being able to transfer benefits to a dependent may have been perceived by some service members as an entitlement, said Sutton, adding that was one of the reasons for the timeframe change.

“In law, transferring those benefits has always been designed as a retention incentive,” he said.

The exact number of Guard members who may be impacted by the change wasn’t available, said Sutton, adding that among those who could be affected are those who didn’t qualify for Post- 9/11 GI Bill benefits until later in their career.

“We do have a small population of soldiers who are over 16 years [of service] before they did their first deployment,” he said.

Some Guard members who may have earned the benefits early on, but didn’t have dependents until later in their careers, may also be affected.

“They joined at 18 and now they’re 15, 16 years in and they get married or have kids later on in life,” said Sutton, who urged Guard members who plan on transferring their benefits to do so as soon as they are eligible.

“If you wait, you’re potentially going to miss out,” he said.

Some Guard members may have been waiting to transfer the benefits until their children reach college age.

4 simple ways to start saving money

Spc. Sabrina Day, 132nd Military Police Company, South Carolina National Guard, with her three-year-old son, Blake.

(U.S. Army National Guard photo by Sgt. Brad Mincey)

“There sometimes are some misconceptions that they have to wait until their kids are college age or that they’re high school seniors in order to do the transfer,” said Sutton, adding there is no age requirement to transfer Post-9/ 11 benefits to dependent children.

“As soon as a child is born and registered in DEERS [Defense Enrollment Eligibility Reporting System], you can transfer,” he said.

After that transfer has been completed, Guard members can still make changes to how those benefits are divided between dependents or which dependent receives those benefits.

“Once the transfer is executed, and you’ve agreed to that service obligation, you can add dependents in, and you can move months around between dependents,” said Sutton. “It’s just that initial transfer has to be done before you hit 16 years of service.”

However, there is one group of Guard members who will not be affected by any of the changes: those who have received the Purple Heart since Sept. 11, 2001.

“The only rule around transferring benefits that applies [to those individuals] is you have to still be in the service to transfer them.”

Regardless of status, Sutton reiterated that Guard members are better off transferring those benefits sooner rather than later.

“Transfer as soon as you’re eligible,” he said. “Don’t miss the boat because you’ve been eligible for 10 years and you just didn’t do it.”

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