Congrats on reaching the Career Starter Loan Decision—proof that your Academy career is progressing nicely. As you consider the decision to take the loan or not, I’d encourage you to also consider how that decision can impact your future example as a leader of sailors, marines, and soldiers.
Most people rarely think about leadership in financial terms. But for future officers, financial responsibility can be an important component of leadership.
The peace of mind that comes from having your financial life squared away allows you to focus more fully on your mission, and making sound, carefully considered financial decisions enables you to set a positive example for those you are asked to lead.
The Career Starter Loan is one of the first opportunities that most Cadets and Midshipmen have to make smart financial decisions. And the decisions you make about whether to take the loan and how to use the money if you do will set the tone for the beginning of your professional life. That’s why it’s so important to get them right.
Let’s be clear: The Career Starter Loan is not a gift; it’s an offer to borrow money and pay it back with interest. And you should only borrow money if you need it and if you have a comprehensive plan for how you will spend the money and how you will pay it back. Let’s look at a real world example.
For a $36,000 loan borrowed at .75% interest for 60 months, you’re monthly payment is $611.51. That’s a hefty drain on your cash flow. It’s tempting and exciting to have this windfall of cash, but be sure to:
- Determine how much you need to borrow to meet your essential needs
- Establish a payment schedule that fits within your budget
- Incorporate your career starter loan strategy into a comprehensive financial plan.
Being on firm financial footing will help you in every area of life and strengthen your leadership focus.
JT Thorp served a 24-year career in the U.S. Navy, entering the U.S. Naval Academy in July 1989 and retiring in 2014. During his time in the Navy, JT operated in the Arabian Gulf, Indian Ocean, Mediterranean and North Atlantic theaters, and logged more than 3,000 mishap-free flight hours piloting fleet and training command aircraft. He joined First Command Financial Services as a Financial Advisor in October 2001 and is currently First Command’s Vice President and Director, Client Services.
The non-profit Bipartisan Policy Center released a report this week titled “Building a F.A.S.T. Force: A Flexible Personnel System for a Modern Military.” The report recommendations were created by the Center’s Task Force on Defense Personnel.
That is the question for military families seeking their next home
It’s often said – mostly by companies that lease cars – that you should always buy appreciating assets and lease depreciating assets.
President Trump’s proposed $1.1 trillion FY18 budget calls for an increase of $52 billion for the Department of Defense (DoD) and $64 billion in cuts to other agencies. To finish out FY17, he also requested $25 billion for the DoD base budget and $18 billion in cuts to other agencies.
It’s the inevitable conclusion of all service members’ careers–leaving the service. The question, though, is how you will know when it’s the right time for you to make that transition.
Just because the federal hiring freeze only applies to civilian employees doesn’t mean that military families are immune from its effects. Many military spouses work on-base in civilian positions.
For active duty military families, the unique demands of being in the service can make buying a home challenging. While deployments and short notice or frequent PCSs make renting or military quarters attractive options for many, the advantages of home ownership – such as possible tax benefits, potential for monthly rental income, having a forever home – can outweigh its shortcomings.
The new year and new administration have not altered feelings of anxiety among military families surveyed regarding cuts to defense spending. Approximately seven-in-10 are anxious about possible cuts and anticipate being financially affected by them.
America’s career military families who expect a Permanent Change of Station (PCS) this summer are already putting their financial houses in order. Nine out of ten middle-class military families who expect to make a PCS this summer have already budgeted for the costs of their move, according to the latest findings of the First Command Financial Behaviors Index®.
Just weeks after the unveiling of the Blended Retirement System (BRS) Opt-in Course, interest in the new system is growing among opt-in eligible service members. The latest results of the First Command Financial Behaviors Index® reveal that 44 percent of middle-class military families say they want to opt in to the new system, rather than be grandfathered into the current system.