Military Financial and Employment Statistics:
The financial and employment statistics for military members are as staggering as they are depressing. The unemployment rate for young military veterans of the wars in Afghanistan and Iraq in 2010 was 21.1% as reported by the Washington Post. And although the Obama administration continues to introduce legislation to provide incentives for companies to hire veterans, the unemployment problem for young veterans continues. Compounding this unemployment problem, however, are the financial dire straights that many military members are in.
A recent FINRA Study reveals that despite a regular paycheck, military members are struggling with debt, with 82% of military families carrying an average of $10,000 in credit card debt. In addition, one in four servicemembers report overdrawing checking accounts in the last year. One in five has used a payday or auto title loan in the past five years. And, according to the study, only 50% have an emergency fund.
Leverage Military Benefits to Escape the Cycle:
If military members want to position themselves to build wealth and long term financial success, the foundation needs to be set early in their military careers, and continue as the members transition from service. The key for military members breaking the cycle of unemployment and financial missteps is in a long term approach to debt, spending, and investing. Those principals are shared often here at compounding returns.
- Tax Savings
- Health Care (TRICARE)
- Thrift Savings Plan
- Montgomery and Post 9/11 GI Bill
- Tuition Assistance
- Military Discounts
- VA Loans
- Military Retirement Pension and TRICARE for Life
The benefits listed above can be leveraged to create the circumstances that will allow military members to leave the service (whether after 4 years or 40), better off than they were when they joined, but only when used strategically and in conjunction with debt reduction strategies, saving, and investing for the future.
Education and Collaboration are Key:
At compounding returns, we hope to provide a forum for military members and civilians alike to build a wealth of knowledge for all of our readers. In pursuit of this goal, we love to have as many comments as possible in the comment section of each post, while we also strongly support guest posting (click here if you'd like to guest post on compounding returns).
But we'd like to do more for our military community as they serve, transition from service, and retire. That's why we've decided to build a personal financial handbook for military members (to be released later in the year in E-Book format), to provide an easy to use guidebook to building a rich future through the intelligent and strategic leverage of military service, benefits, and experience.
Standby for more information on our coming E-Book in the months ahead.
Are you an active duty member, reservist, veteran, or retiree? What in particular would you like to see covered in our new E-Book guide for military members?
Photo By: The US Army
I am a veteran of the Vietnam conflict. I would be interested in learning what benefits or services are available for older veterans.
ReplyDeleteThats a great idea. Maybe I'll look at a separate EBook on the idea of non-retired veterans benefits. Much of it will be covered in the coming volume, but a guide for those who served years ago could definitely find a following.
ReplyDeleteThe E-book is an excellent idea. I'll keep my eye out for it so I can notify my Soldiers that another resource has become available to them.
ReplyDeleteI think single soldiers with no dependents (a group I am a part of) are provided with an excellent opportunity financially when we deploy. As an officer I make 2-3 times what my soldiers do however in both cases the money us untaxed and because we are single we should have almost no financial obligations during our time overseas (for those of us in the Army that is 12 whole months that can be spent accumulating cash!). The unfortunate truth is that this cash is typically wasted on big expensive toys upon return (an disproportional amount of soldiers seem to have the latest smart phone, IPads, flat-screen TVs, video game systems, etc...). Getting through to them on the sheer power of that much money early on in their lives is critical, perhaps your e-book can take a stab at that while I try to do so with my guys over here in Afghanistan!
Of course soldiers with dependents is a whole other can of worms. I've found that the majority of marriage problems for soldiers revolve around money, alcohol, and time separated. Getting their finances straight would go a long way to preserving a lot of young military families.