Posts Tagged ‘military families personal finance’

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Money Monday

Monday, June 17th, 2013

By Barbara O’Neill

What factors make service members and their family attractive targets for lenders?

Service members are prone to greater financial challenges because of their unique behaviors. Lenders know that service members are required to maintain financial stability, including a good credit score, to maintain their security clearance. Lenders see this as a sign that service members will work hard to pay off any debts they incur or to at least seek counseling and assistance when they are having problems. Also, service members are not able to “disappear” if they fall behind on their payments. Lenders know that, even in the case of a PCS move, they will be able to find the service member and collect on old debts.

Another fact lenders are aware of is how much each service member earns. Pay scales are available online and can be used by lenders to determine the amount of debt military families are able to support. Finally, service members tend to start borrowing money at a younger age than civilians. This can lead to big financial decisions being made by inexperienced consumers trusting banks and other lending organizations that do not have their best interest in mind.

For additional information, refer to consumerfinance.gov/Service Members/.

Browse more military personal finance Frequently Asked Questions answered by experts.

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This post was published on the Military Families Learning Network Blog on June 17, 2013

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Two Personal Finance Webinars Next Week!

Friday, June 14th, 2013

Join the Personal FinanceEducation2 team for a busy week starting Monday with Paying for Education Expenses and the GI Bill with speaker Drew Hill, Director of Veterans Affairs – Worldwide with Embry-Riddle Aeronautical University. Mr. Hill’s 90-minute presentation will cover the post 9/11 GI Bill and the Montgomery GI Bill. Topics to be covered include: eligibility, the application process, and transferability. This presentation in Part 2 in our Paying for College series. Review Part 1 here.

Then on Monday, Dr. Barbara O’Neill and Dr. Michael Gutter will present Credit Basics and Debt Repayment Strategies. This 90-minute session will focus on credit and debt management strategies and provide numerous resources to support consumers to succesfully manage their finances. Credit Basics & Debt Management

Both of the web conferences will offer 1.5 continuing education credits to AFC-credentialed participants. Both web conferences begin at 11 a.m. ET. To connect to the hosting platform, security certificates are required. Please review these instructions. Alternatively, both presentations will be streaming on Ustream.

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Money Monday

Monday, June 10th, 2013

By Barbara O’Neill

How can service members defer student loan payments?Photo by Virginia Guard Public Affairs (creativecommons.org)

An important factor for service members to keep in mind is that they may be eligible for a deferment only if they have not already defaulted on their loans. The type of deferment provided varies depending on the type of loan the service member is paying. All three loan types—Federal Family Education Loan (FFEL), Direct, and Perkins—may be deferred while the service member is on active duty during a war or other military operation or national emergency. Active duty personnel would include members of the National Guard or Reserves who were called to active duty service.

There is no time limit on the military deferment, but the eligibility period ends 180 days after the borrower has returned from active duty service. In cases where the borrower is not eligible for deferment, he or she may apply for forbearance. There are provisions for a mandatory forbearance for National Guard members who qualify for post-active duty deferment.

For more information, refer to studentloanborrowerassistance.org/repayment/postponing-repayment/deferments/.

Browse more military personal finance Frequently Asked Questions answered by experts.

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This post was published on the Military Families Learning Network Blog on June 10, 2013

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Money Monday

Monday, June 3rd, 2013

By Barbara O’Neill

Can a service member in his 30s use funds in a traditional IRA to pay for college? Photo by Fort Meade (creativecommons.org)

Like all IRA owners, service members who withdraw funds from a traditional IRA before age 59 ½ are subject to the 10% early withdrawal penalty with a few exceptions. One of these exceptions is to pay for qualified higher education expenses. Funds withdrawn will be subject to the early withdrawal penalty, however, if they are in excess of the actual amount of expenses.

When determining the amount of money needed to withdraw, service members should take into account any distributions from 529 plans, scholarships, grants, and other tax-free payments, such as gifts or inheritances they have received during the year. Qualified higher education expenses for the IRA exemption include tuition, fees, books, supplies, and equipment required for enrollment as well as room and board as long as the student is attending school at least half-time. For more information, refer to irs.gov/publications/p590/ch01.html#en_US_2011_publink1000230896.

Browse more military personal finance Frequently Asked Questions answered by experts.

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This post was published on the Military Families Learning Network Blog on May 27, 2013

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Money Monday

Monday, May 20th, 2013

By Barbara O’Neill

What are some tips for service members for naming beneficiaries for insurance policies and retirement savings plans such as the Thrift Savings Plan (TSP)?

Photo by lorenkerns (creativecommons.com)

Photo by lorenkerns (creativecommons.com)

First, service members should regularly review the beneficiaries named in insurance policies and retirement savings plans and revise them as needed. Second, service members should name secondary beneficiaries in case the primary beneficiary predeceases them. Third, service members should record in one document all of the beneficiaries and contingent beneficiaries for all of their important papers that include named beneficiaries for ease of review and periodic updating. A form to record beneficiary designations can be found at njaes.rutgers.edu/money/pdfs/beneficiary-designations.pdf

Browse more military personal finance Frequently Asked Questions answered by experts.

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This post was published on the Military Families Learning Network Blog on May 20, 2013

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The Johnsons discuss 529 Plans

Tuesday, May 14th, 2013

The Johnson family first joined us during Dr. Michael Gutter’s April 15 Financial Statements & Record Keeping web conference. Here, they discuss opening a 529 plan for their 2-year old son, Sam. Watch as Brittany and Brett discuss the advantages of this education savings option, and save the date of May 21 for Dr. Barbara O’Neill’s Paying for Post-Secondary Education Expenses web conference.

 

The Johnsons discuss 529 plans
by: msgutter

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Money Monday

Monday, May 6th, 2013

By Barbara O’Neill

Are the children of service members covered by the federal health care law that allows adult children to stay on their parent’s health care plan until age 26?Photo by DVIDSHUB (creativecommons.com)

Yes. Congress passed legislation requiring TRICARE, the health insurance program for active and retired service members, to adopt the provision required for health insurance offered by civilian employers to extend health care insurance for young adults until age 26. An annually adjusted fee ($176 or $201 per month in 2012, depending on the type of plan selected) is charged for each young adult covered through a parent’s insurance. Young adult TRICARE premiums are based on recent medical expense data.

Browse more military personal finance Frequently Asked Questions answered by experts.

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This post was published on the Military Families Learning Network Blog on May 6, 2013

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Money Monday

Monday, April 29th, 2013

By Dr. Barbara O’Neill

What is Military Stop Loss Pay?

Military Stop Loss occurs when a service member’s enlistment is involuntarily extended. As a result, additional pay may be provided to service members in this situation.

The deadline for filing a Retroactive Stop Loss Special Pay (RSLSP) claim for stop loss between September 11, 2001 and September 30, 2009 was October 21, 2012. RSLSP pay is $500 for each month/partial month served in stop loss status and the average benefit is $3,700.

Eligibility, filing, and payment information for Retroactive Stop Loss Special Pay is available online at http://www.defense.gov/home/features/2010/0710_stoploss/.

 

Browse more military personal finance Frequently Asked Questions answered by experts.

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This post was published on the Military Families Learning Network Blog on April 29, 2013

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Meet the Johnsons

Monday, April 22nd, 2013

Meet the Johnson Family. Brett, Brittany and their son Sam are the subject our our personal finance case study, which details this military family’s financial situation. Brittany, a nurse, enjoys her career and earns a good salary. Brett also enjoys his career as a Corporal in the Army. They are focused on staying current on their bills and saving for their son’s education.
In this video, watch as Brittany and Brett discuss how to use their tax return, and stay tuned for more videos featuring the Johnsons!

This video and this blog post were published by the Military Families Learning Network and shared on the Military Families Learning Network blog on April 22, 2013.

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Money Monday

Monday, April 22nd, 2013

By Dr. Barbara O’Neill

A service member is using Post-9/11 GI Bill benefits to pay for college. How much housing allowance will be received monthly? Photo by pbinder (creativecommons.org)

A military veteran who is enrolled in college full time can expect to receive a monthly housing allowance equal to an E5 with dependents for the ZIP code in which the college is located. In July 2011, the national average for this housing stipend was $1,350 per month, although it was as high as $2,700 in some locations. Service members should stay up-to-date on current program rules for the Post-9/11 GI Bill. This is still a relatively new program, and therefore some of the rules and regulations are still being tested and refined. According to the website www.military.com, Congress is currently working on legislation that will pay the housing stipend only during the weeks school is actually in session. That means that if a veteran is attending a university on a semester system and the term ends May 10, he/she will receive a housing stipend only for the first 10 days of May. The stipend will begin again when classes start again. Veteran students will be responsible for covering their rent during the time between receiving GI Bill payments. If they are attending a 100% online school, starting Oct. 1, 2011, they will receive half the national average Basic Housing Allowance (BAH) for an E5 with dependents, or around $637.50 per month.

For additional information and updates, refer to the website listed above or www.gibill.va.gov.

For more information on the GI Bill, make plans to attend our web conference, “Paying for Educational Expenses and the GI Bill” on May 23, 2013.

 

Browse more military personal finance Frequently Asked Questions answered by experts.

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This post was published on the Military Families Learning Network Blog on April 22, 2013

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