Are You a Serving Member of the U.S. Military or a Veteran? Make Sure You Are Taking Advantage of These Financial Benefits.
Serving your country is life changing, make sure you understand your financial benefits
A career in the armed services can be a fulfilling experience. More than just an opportunity to serve your country and help people in need, you may have chances to travel and to meet experts and diplomatic personnel from both at home and abroad. It can also be financially rewarding. Not only may you be paid well for your work, there are numerous other financial benefits that are accessible to serving members and veterans. Even so, many do not know about or make full use of the available perks in education, banking, tax and housing. Read on to make sure that you are not missing out on these advantages.
Some of the most generous programs open to those actively serving and to veterans help to pay for university-level education. Full-time military personnel can receive annual tuition assistance of up to $4500, or $250 per credit hour. If you enter military service with a college loan, you may also receive financial aid to repay part of the loan. In addition, spouses of active members can receive tuition assistance of up to $4000 in total through the Military Spouse Career Advancement Accounts. Finally, veterans who have 90 continuous days of active service can make use of the Post-9/11 GI Bill. This provides full undergraduate tuition at a state university or college, a living allowance and stipends for books and supplies. If you are interested in attending a private institution, schools participating in the Yellow Ribbon Program may waive some of the tuition above the amount provided by the GI Bill.
Besides the many programs assisting with the costs of tertiary-level education, you have access to various financial benefits that can make it easier and more lucrative to bank, save and invest your hard-earned money. The Thrift Savings Plan is a low-fee investment option with a .038% annual expense ratio. It allows you to select an index mutual fund and make an annual contribution of up to $55,000 during active deployment and up to $18,500 when not deployed. Like civilians, military personnel can also invest in Roth IRAs. Unlike civilians, however, those on combat duty have the added advantage of contributing their tax-free combat income to the account. Then, as is always the case with Roth IRAs, withdrawals can be made free of tax. Lastly, various banks offer savings and checking advantages to those serving in armed forces. A military checking account may be free of ATM fees, service fees, and balance requirements. They may also offer savings accounts without minimum deposit requirements and higher APYs than those normally offered.
The banking and investment benefits discussed above can help you to save more money. Similarly, members of the armed forces have opportunities to save via tax-free income and tax deductions not available to civilians. Basic pay and hostile fire pay received while you are in a combat zone, reenlistment and continuation bonuses and leave benefits are all tax-free income. Moreover, you can deduct some expenses related to uniforms, moving, travel and life insurance. College loan repayments are also deductible while you are in a combat zone.
In addition to the tax deductions above, it is important to know that the IRS allows everyone to deduct the interest on their mortgage payments. Military personnel have further advantages when buying a home. Basic Allowance for Housing received by those actively serving can be used to pay for either renting housing off-base or mortgage payments. If you are a veteran, you may qualify for a mortgage through the VA home loan program. These loans have low interest rates and do not require a down payment. Active duty military can also access VA loans, if they have served 181 consecutive days during peacetime or 90 consecutive days on combat duty.
As a member of the United States military, you have worked hard for the money you have earned. You deserve to make full use of the many financial advantages available to you. If you do, you can provide a secure future for yourself and your family.