retirement planning for vets

Retirement Planning Tips for Veterans this Veterans Day

The ebb and flow of the U.S. economy has made retirement saving without a plan difficult. And for veterans specifically, transitioning from your life in the military, indeed makes the transition even harder. Retirement means sufficient savings and in today’s difficult economy this requires plenty of planning done in advance.

It’s an unfortunate fact when the men and women who have served our country in the military are targeted by lenders and salespeople who put them into bad investments. These situations often leave them in crippling debt, and destroy their credit. 

While those who have served have many resources at their disposal, navigating benefits, wealth planning and government-sponsored programs can become complicated. With some financial planning and the aid of a financial advisor you can help protect yourself and get the most from the veterans benefits you’ve earned. Here are some tips that should help.

  1. Create a retirement plan 

Americans who have done a retirement calculation have nearly five times the savings of those who haven’t, according to the American Savings Education Council. Once you reach age 65 (or sooner if you have a disability and you could be eligible for a Veterans Pension from the VA. Eligibility depends on your income, net worth, and whether you meet the active service requirements.

Surviving spouses and unmarried dependent children are also eligible for VA pension benefits in certain instances. Depending on when you entered the service you may also be eligible for pension benefits under either the military’s Blended Retirement System (for those who joined on or after Jan. 1, 2018) or the legacy High-3 system. 

  1. Take advantage of other savings plans 

If you’re like most people, qualified retirement plans, Social Security, and personal savings and investments are expected to play a role. Once you have estimated the amount of money you may need for retirement, a sound approach involves taking a close look at your potential retirement income sources. 

If you have a job in the private sector that provides a 401(k), make sure that you use it. Taking full advantage of the tax benefits and employer plan is key to building a successful retirement. Additionally, don’t make the same mistake 20% of Americans do by not contributing to this plan. Think in terms of multiple retirement savings plans such as IRAs, TSPs, Roth IRAs, Simple IRAs, SEP-IRAs and Keoghs. The more you save now the bigger your nest egg will be.

  1. Using and Preserving Your Veterans Benefits

Veterans are eligible for educational benefits under two current versions of the G.I. Bill: the Montgomery GI Bill–Active Duty or the Post-9/11 GI Bill. To be eligible for education and training funding through the MGIB-AD, you must have served at least two years of active duty during certain time periods and meet other criteria listed on the VA website. In most cases, you must also have paid a total of $1,200 into the education program while you were serving.  If you qualify, you can receive up to 36 months of financial assistance. As of October 2020, the maximum monthly benefit was $2,122 a month for full-time students.

As a veteran, you are eligible for VA healthcare, but you must generally enroll in order to participate.This coverage is free if you meet the income requirements, although there can be copayments for certain services and medications. Retired veterans and their family members are eligible for coverage through the Defense Health Agency’s TRICARE program. It’s important to do some research and see what benefits are available for you and your loved ones. There could be some benefits you’re missing out on!

Last Thoughts

Many veterans who have served our country have spent their lives until retirement receiving financial and health benefits within a military setting. Life outside can be very different, with new opportunities and new rules. Getting help with the transition from DOD-funded programs can be extremely beneficial.

If you’ve already come up with a retirement plan, you probably already have a “strategy” to follow. Losing track of it is only going to render your strategy useless. Review your plan, adjust your strategy if required, and make sure you’re meeting your financial targets on time.

Finding the right financial advisor that fits your needs doesn’t have to be hard, either. Johnson Wealth and Income Management has an array of financial advisors who are experienced in retirement planning for veterans. At JWIM, our team of advisors will act in your best interests. If you’re ready to be matched with local, Iowa advisors that will help you achieve your financial goals, get in touch with us here now.

Wishing all our veterans a huge thank you for the risks you take and the sacrifices you make.

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