4 Ways the Military made me RICH!

The military has allowed me to get ahead financially. Here are 4 things I used to get that financial edge compared to many people my age, thanks to my military benefits. These benefits allowed me to invest a lot of extra cash I otherwise would have spent.

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Some Credit Card Companies Waive their annual fees:

For those of you who are not credit card users, or do not understand the major benefits of credit cards, this is a significant perk of being Active-Duty military. 

It is one of the few perks that is not provided directly from the government and instead is provided by companies who are choosing to support the troops (there are however certain laws they must follow which incentives them to provide this benefit).

Here are a few examples of credit cards I have personally used. 

1. Amex Platinum – $695 annual fee (cost to me, $0). I use this to get a free audible membership, free uber credits each month, a few thousand dollars’ worth of travel points, access to world class airport lounges, $100 per year at Saks Fifth and even airline and hotel credits up to $400 annually. 

2. Chase sapphire reserve – $550 annual fee. I use this card for the travel points ($750 worth), and a $300 travel credit

3. Normal airline cards – One I use is the United Airlines credit card which has a $95 annual fee, I used the points to get free flights which was slightly over a $400 value for what I used it for. 

There are many other cards you can investigate, and the benefit is only while active duty, but getting free flights and access to airport lounges is awesome! Spouses may also qualify for this benefit, for example I know that spouses qualify for the Amex Platinum currently. So, both you and your spouse could have your own card and get double benefits. 

I highly recommend avoiding credit card debt and making sure you are using the credit card responsibly. Talk to a finance professional to address your specific situation.  

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TSP Match

In the military we all have something known as TSP (thrift savings plan). It’s very similar to a 401k that a normal employer would offer, however one of the benefits is that it offers a 5%, 1 for 1 match, which is quite high compared to many companies. 

Investing just 5% of your paycheck instantly gets doubled and turns into 10% of your paycheck invested. You put in 5%, they double it for ‘free’. 

This TSP match has so far been worth thousands of dollars extra in investments for me and my spouse who also received her TSP match. 

If you are not getting your 5% match through TSP, you are throwing away money! So please get your match. It’s the only way I know of where you can instantly double your investment.

For people not very interested in investing, putting 10-20% of your paycheck into TSP and investing in anything other than the G-fund is a great option to save a decent chunk of change while you are serving. 

You should speak to your local finance office to get advice that fits your personal situation. I personally did 5% match and put almost all of it into the C-fund, which is the fund that goes along with the stock market. After 4 years this 5% match (on E-1 to E-4 pay) turned into about 10k, which isn’t bad for such a small amount invested. 

Just remember this match is typically just for base pay, not for BAH or BAS or any other extra pay.

There is a major difference between the G and C funds. In the last year the G-fund returned 1.38%, and the C-fund had a 28.68% return. 

That’s a major difference in potential money to be made. But to understand more about each fund you can go to the TSP website or ask your financial advisor. 

If these returns continued for another 10 years (which is an extremely unlikely scenario), $1000 into the G-fund would end up being ~$1,140, and $1000 into the C-fund would end up being ~$12,450.

For those of you who don’t know, 28% is a very good year which is unlikely to continue every year. The C-Fund had a great year. The 1.38% in the G-fund is historically a low return and very low risk. However, there does not seem to be any sign of those returns increasing very much from my perspective (at least any time soon). 

Some people may be content with those low returns, especially if you are in retirement and just don’t want to lose your money. 

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VA Loan

Did you know that almost all millionaires own real estate? 

The VA loan is a brilliant way for service members to get wealthy and start building a real estate portfolio. 

Buying a home when you are young and renting it out to roommates can be a game changer. That is one of the things we did to save some extra cash. 

You can do something called house hacking and end up paying nothing for housing, paying off your mortgage, and building wealth while you are stationed somewhere. House hacking is basically just having roommates, so your personal expenses are much cheaper, or having a multiple unit property and renting out the other units while you live in one. This allows you to build equity in the property and save on rent/utilities. 

There are very few opportunities in real estate where you can buy a home with a 0% down payment and not have to be very creative in the financing. 

Buying a home is a game changer, if you make sure it’s a good house and that you can afford repairs or the bills if you can’t find anyone to live with you for an extended period. 

I believe that duplexes are one of the best ways to do this because you can live in one unit and rent out the other. Your cost of living is cut in half, and you build equity too. 

Make sure you talk to a financial professional to ensure this is a good decision for you. Everyone has a different situation, and we all live in different locations. 

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Free College

I personally joined the military for this benefit. I think it’s one of the top benefits that we receive as service members. 

You can get free college both while in the military using TA (Tuition Assistance) or the GI Bill, and once you separate using the GI Bill and other scholarships/programs depending on your own circumstances. 

I personally used TA while I was serving which allowed me to get my Associates degree during my 4 years of service. Now that I am separated, I still have 36 months of college education remaining which I could use on many different education programs. 

Another thing to remember is that you still have access to things like normal college scholarships as well as FAFSA, and if you are an E-1 to E-4 you are making such little money that you will likely get a bonus from FAFSA which you can use to get things like a laptop, a vehicle for school, or your textbooks. 

You also get paid once you separate and use your GI bill. The current payment for the post 9/11 GI bill is E-5 monthly BAH and additional money for books. 

That ends up being enough for me to survive on while getting a degree and not having to get into any debt at all. It’s a great deal!

You can also work while in college if you need some extra cash or if you just want to continue to save and invest while enrolled in your degree program (my personal preference). 

College, credit cards, VA loan, and TSP. These 4 things alone can set you up to have quite a successful financial life. 

There are also many other benefits you can use, like military discounts on online shopping, gyms, applications, phone bill, and car insurance.

Adding up all these micro-benefits, you may save more than $1,000 per year. 

🔎Disclaimer🔎 All content in this blog is for entertainment purposes only. I am not a professional financial advisor, and my statements are not to be taken as instructions or directions. In no event will I be liable for any losses or damages arising from the use of content from any of my platforms, including, but not limited to YouTube, Blog, or any other social media. I reserve the right to change my opinions and entertainment content at any time. Please be sure to do your own due diligence!

Published by Christal

I write to share my experience of going from $0 to a millionaire and what I am learning along the way. Working toward that goal one day at a time and sharing the tips and tricks I'm trying.

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