Articles by Ryan Guina

Ryan is the founder and editor of this site. He is a writer, small business owner, and entrepreneur. He served over 6 years in the USAF and also writes about money management, small business, and career topics at Cash Money Life.

You can find him around the web at, Ryan Guina on Twitter, The Military Wallet on Twitter, and on Google.

Should I Join The Military While They Are Downsizing? (Podcast 015)

The Military Wallet Podcast on iTunesThe military is downsizing it’s forces. Service members are being laid off in numbers we haven’t seen since the end of the Cold War era in the early and mid-90s. Benefits are also on the cutting block. Is the military still a good career option with these changes happening now and expected to continue for the foreseeable future?

Should I join the military during downsizing?

There are a lot of ways you can look at the future of serving in the military, but I’ll share my perspective, in response to a reader question in which the reader asks if it’s still a good idea to join the military, even while the military is reducing its end-strength. Here is the reader question:

Can the military discharge you for no reason? I thought I read somewhere a couple years ago that the military just started randomly firing people because of the new budget or something. I want to join the military when I graduate but I don’t want to end up getting discharged for no reason and end up broke. ~ Jacob

This is a great question, and one that faces our next generation of service members. Things are changing, and will continue to change in the coming years. Let’s jump in and answer Jacob’s question, which is probably bigger a bigger question than he thinks.

We’ll start with the concern over being laid off (also called Force Shaping, or Reduction in Force (RIF)).

Can the Military Discharge You with No Reason?

No. At least, not really. There is always a reason. But I think what you are asking is whether or not the military can discharge you through no fault of your own? In that case, the answer is, sometimes.

In some cases, the military can elect to discharge people through downsizing, or a process often referred to as Force Shaping, or Reduction in Force (RIF). The military is getting smaller right now due to changes in requirements, the way wars are fought, and of course, due to budget constraints. The Department of Defense (DoD) has determined the final number of people they need to get down to, and then they are coming up with ways to reach those goals. In some cases, they allow members to retire early. They also ask for volunteers to leave the service early. It is only after they don’t get volunteers or early retirements that they will let people go. If they do let people go, it is often with some form of separation pay, which you can read about here.

While you can’t completely prevent being laid off from the military, there are some things you can do to reduce your odds of being selected for Force Shaping, such as choosing a career field that is undermanned, or that won’t be going away in the near future, maintaining military standards (not failing any training or physical fitness tests, for example), and maintaining strong annual performance reviews. None of those are foolproof, but they will make you more competitive for keeping your job.

Listen to our Force Shaping Podcast for tips on surviving a military layoff.

Military Can Still Be a Good Career Option

The military can be a great career, but there are many risks – physical risks being the obvious. There are other risks such as not being able to control where you live, when you are called to go somewhere, and as you mentioned, there is also the risk of being “laid off,” which is why you wrote your question. That said, don’t let that dissuade you from joining if you feel the military is a good option for you. You can still have a great military career or use the military to launch the next stage of your career, even if you only serve one tour.

I’ll give myself as an example. I joined the Air Force on a six year enlistment. During my six years I had the opportunity and good fortune to travel the world, learn a trade, earn my degree (which the military paid for), and gain a variety of experiences I could take with me into the real world after leaving the military, which I did.

After serving my six year tour, I was ready for a change. I left the military and entered into the civilian world where I used my Air Force experience while working as a consultant to the Department of Defense. I worked for about 4 years in the corporate world before starting on my own as an entrepreneur. I am now self-employed. Would I be here today if I hadn’t joined the Air Force? Probably not, as leaving the military was a big inspiration for starting my business (and this site you are reading is part of my business as well; and I certainly wouldn’t have the knowledge to run this site without having first served in the military).

And my military experience didn’t end there — I later joined the Air National Guard because I missed being around the military environment.

If you look at you career in terms of seasons, I am now on my fourth season (Air Force, civilian contractor, self-employed, Air National Guard), and all four were directly impacted by my military service. Even though I only served on tour on active duty, my life has been greatly impacted by those 6 years on active duty!

But Getting Laid Off is Different than Choosing to Leave!

Absolutely. Getting laid off is never easy. Thankfully, Reduction in Force measures only impact a very small percentage of servicemembers, and the military does take some steps to make it easier for those they lay off. For example, enlisted members are given advance notice they will not be allowed to reenlist when their contract is up. This is generally done with at least 6-12 months notice, and sometimes much longer. Officers are usually given a deadline to leave, but they usually have a similar window. Almost all military members will be able to complete at least one tour of duty before they are RIF’d (and again, it will only ever impact a very small percentage of servicemembers).

Separation pay is also given to military members with at least six years of service. Separation pay is determined with the following rules:

Monthly base pay x 12 x years of active duty service*, x 10%

You could also say this as – 10% of your Annual Base Pay, times the number of years you have served.

*Months of service are counted as 1/12 of a year.

Let’s work through an example of an E-5 receiving involuntary separation pay at 6 years:

$2,734.50 base pay x 12 = $32,814.00

$32,814.00 x 6 (number of years served) = $196,884.00

$196,884.00 x 10% = $19,688.40 = Full Separation Pay.

To determine the separation pay you may be eligible to receive, simply plug in your base pay, number of years (including fractions), and multiple by 10%. The longer you have served and the higher your rank, the greater the value of your separation payment.

Benefits to Help through the Transition Period

The military and other organizations offer many benefits to help you through the transition process. Here are just a few of the major programs you may be eligible to receive when you separate from the military:

  • Health care benefits during transition. The military also provides additional health care benefits to those who are involuntarily separated. The Transitional Assistance Management Program provides full health care benefits to the military member and his or her dependents for 180 days after separation. COBRA benefits are also available.
  • Unemployment benefits are also available to separating military members (except retirees, who receive an immediate pension). So you can have that to fall back on.
  • Employment programs & Job fairs: There are also many employment programs to help you find work after leaving the military. These are often available through local agencies such as your state or county employment bureau. There are also federal hiring programs for veterans. Finally, there are many job fairs that specifically target veterans. You may even find that your military experience is highly sought after, especially if you have a top secret clearance.

National Guard or Reserves is Another Career Option After Active Duty

Even if you do get involuntarily separated from active duty, you may still be able to join the National Guard or Reserves (podcast/article). The Guard and Reserves, if you are not familiar, is a part-time version of active duty, but they can be called up to active duty in an emergency. The typical schedule is one weekend a month, two weeks a year. But there are also many Guard and Reserve members who work a full-time schedule, or more days than the normal one weekend a month, two weeks a year schedule.

There are many benefits to joining the Guard and Reserves, including access to certain benefits, including inexpensive health care, pay, you continue working toward earning a military retirement, which you would be able to start receiving at age 60, and just as important – you can continue to be part of the military, which is important for many people. It’s very difficult to leave the military, so even participating in it part time can have a dramatic impact on you.

Some National Guard and Reserve jobs tie into civil service jobs, so you can get the benefit of working a civilian job during the week and do the same job once a month in the military.

Additional Veterans Benefits

Finally, there are other benefits you may be eligible to receive after leaving the military, including the Post-9/11 GI Bill, which will pay for your college tuition and provide a housing stipend while you attend school, the VA Loan which can help you buy a house with no money down, and many other benefits.

  • How valuable is the Post-9/11 GI Bill? Incredibly valuable. It will pay for college tuition up to the amount of the most expensive state college where you attend school. It will also give you a housing allowance at the E-5 with dependents rate. That varies by location, but can range anywhere from around $600 a month, up to almost $3,000 per month. You can use those benefits for 36 months of tuition. Those 36 months only apply while you attend school, so that equates to a four year degree when you take summer breaks into account. Here is a recent podcast and article discussing how to use the Post-9/11 GI Bill.
  • VA Loan. I mentioned the VA Loan. That allows veterans to buy a home with no down payment, often at rates that are slightly lower than a conventional mortgage. That is because the loan is backed by the Department of Veterans Affairs, which makes them a little safer for banks. The closing costs may be waived for veterans with a service connected disability.
  • See our Veterans Benefits Guide for more veterans benefits.

Should You Join the Military?

I won’t even pretend to give you an answer on whether you should join the military or not. That is a personal decision that needs to be made by you, and you alone, unless you are married. Then it’s important to involve your spouse.

Look, there are hundreds of reasons to join the military, and just as many reasons not to join. But I don’t think you need to worry about getting laid off. Can it happen? Absolutely.

If you join the military and do get laid off, then you should have the poise and experience to roll with the punches. Use your skills, education, and experience to use your military time as a launching pad to your next adventure. Or consider joining the Guard or Reserves. That too, can be an amazing opportunity to grow your professional skills and continue earning money now, and toward retirement.

Or you could also end up making the military a career, earning a pension after 20 years of active duty service.

There are many opportunities if you join the military. I would encourage you to investigate those fully. There are amazing opportunities for your career, education, travel, friendship, camaraderie, service, and more. The time I spent on active duty were some of the most amazing years of my life, and I know many people who feel the same way. If this is something you want, then chase it down.

More podcasts on joining the military: Listen to podcast episodes 5 & 6, where we discuss active duty military benefits and joining the military, respectively. You can listen to them or subscribe to our podcast on iTunes.

Using the Post-9/11 GI Bill – Tips to Make the Most of Your Benefits (Podcast 014)

Are you familiar with the Post-9/11 GI Bill? Many veterans who served after September, 2001 are eligible for the Post-9/11 GI Bill, but don’t know much about the benefits, whether they are eligible, or how to use this benefit. In this podcast, we discuss we walk you through the process of qualifying for the Post-9/11 GI Bill and what the benefit covers, including how to determine the maximum tuition rates, and your BAH or housing allowance.

We also discuss how to actually use the Post-9/11 GI Bill (hint: all you need to do is qualify for the benefit, be accepted to your school, and your school should do virtually everything else!).

Using the Post-9/11 GI Bill

Anthony Tran - Internet Marketing CoachingAbout our guest: Our guest for this podcast is Anthony Tran, a USAF veteran who successfully used the Post-9/11 GI Bill to complete 3 Master’s Degree programs. Talk about getting maximum value from a benefit! Anthony was able to use the Post-9/11 GI Bill to make him more marketable in the work force, and to help him switch from the automotive industry to the aerospace industry. Today, he is a successful entrepreneur who runs the website and podcast, Marketing Access Pass, where he provides Internet Marketing Training and Services to help other entrepreneurs successfully launch their own business.

About the Post-9/11 GI Bill

The Post-9/11 GI Bill is an improvement over previous versions of the GI Bill, which hadn’t kept pace with the rate of college tuition increases. It was created to help the large number of veterans returning from the Afghanistan and Iraqi campaigns. Many of them were facing unemployment and having a hard time transitioning back into the civilian sector. The Post-9/11 GI Bill goes a long way toward making it easier for veterans to achieve their degree without taking on debt.

Why the Post-9/11 GI Bill is Better than the MGIB

The Montgomery GI Bill is the GI Bill program most veterans are familiar with. This is the program servicemember scan buy into when they join the military. It pays the veteran a flat rate of $1,717 per month (see current MGIB rates). The veteran is then required to use those funds to pay for their tuition. Anything extra can be kept; but any shortfalls come out of the veteran’s pocket.

The Post-9/11 GI Bill, on the other hand, is free to veterans who qualify. Tuition is paid directly to the school at the rate of most expensive state college in-state tuition rate in the state where the school is located. Veterans also receive an annual book stipend and a monthly housing allowance equivalent to the E-5 with dependents BAH rate.

The Post-9/11 GI Bill is better 99% of the time. The only time the MGIB is better is when the veteran has a full-scholarship or tuition assistance through their employer and can pocket the entire MGIB (I have a friend who did this).

Using the Post-9/11 GI Bill

Using the Post-9/11 GI Bill is very easy. You need to qualify, obtain a letter of verification from the VA, then get accepted to your school. From there, the education institution will take care of all the paperwork.

Qualifying for the Post-9/11 GI Bill:

To qualify for thePost-9/11 GI Bill, veterans must serve at least 90 days after Sept 10, 2001. Veterans must serve 3 full years to qualify for the full benefit, unless they are discharged due to a service-connected disability. Here are the percentages for the partial benefit:

  • at least 90 days = 40%
  • at least 6 months, but less than 12 months = 50%
  • at least 12 months, but less than 18 months = 60%
  • at least 18 months, but less than 24 months = 70%
  • at least 24 months, but less than 30 months = 80%
  • at least 30 months, but less than 36 months = 90%
  • 36 months or more = 100%
  • Also 100% if discharged with service-connected disability and minimum of 30 days service.

Members of the National Guard and Reserves are also eligible to qualify for the Post-9/11 GI Bill, depending on how many days they served on active duty. Basically, all active duty service under Title 10 & 32 orders qualifies for the Post-9/11 GI Bill. Service that doesn’t qualify for the benefit, includes Inactive Duty Training (IDT) (Drill training), Annual Training, and active duty for medical care or evaluation.

Eligibility Verification Process:

To verify your eligibility, simply contact the VA. They will verify your service dates and your discharge rating and determine if you are eligible to receive the Post-9/11 GI Bill. You will then receive a benefits verification letter in the mail stating your eligibility for the Post-9/11 GI Bill. You can then take that letter to your school and they will handle the paperwork with the VA.

Attending School Under the Post-9/11 GI Bill

After you qualify for the Post-9/11 GI Bill and give your school the letter of verification, they take care of all the admin work. You don’t have to worry about the tuition, and you should start receiving BAH the next month. That means all you need to do is focus on completing your coursework. The good news is you don’t have a required minimum GPA to use the Post-9/11 GI Bill, other than passing your classes. Just focus on passing your classes, and everything should work out fine.

Use the Post-9/11 GI Bill to Improve Your Career Opportunities

In the podcast, Anthony discussed how he used the Post-9/11 GI Bill to help him move from the automotive industry into the aerospace industry. Even though there were some similarities between the two industries, he needed something else to make his resume more attractive when changing industries. Obtaining another Master’s Degree helped pave the way to a successful career change.

You can do the same thing. Education by itself isn’t a magic bullet that will get you hired immediately. But it does help make your total package more attractive. As a general rule of thumb, the more relevant education and training you have on your resume, the more attractive you will be to a hiring manager, or company.

Your military experience, coupled with certifications and formal education will go a long way toward getting you hired when you leave the military. I encourage you to start while you are still in the military, if possible. That can include using the Tuition Assistance Program or obtaining licenses or certifications. If you have already separated from the military, then I encourage you to look into using the Post-9/11 GI Bill. It’s an amazing benefit that will pay for most, if not all of your college degree.

Reserve IDT Travel Reimbursements

It’s not uncommon for many Guard and Reserve members travel long distances to perform their drill duty, or Inactive Duty Training (IDT). I counted license plates from about 7 neighboring states at my last drill. I have friends in different units who tell me there are some members who regularly fly to and from their monthly drills. Talk about dedication!

The good news is if you live outside the normal commuting distance, your unit should provide Lodging-in-Kind, and may even reimburse you for your travel expenses (up to a certain amount). So don’t let the cost of travel be a reason no to join the Guard or Reserves. However, the rules here are very broad, and are not standardized between the services. Reimbursements may even depend on your pay grade or your AFSC or MOS. Let’s take a deeper look at what’s available.

Reserve IDT Travel Reimbursements

For the purposes of this article, we will separate the Guard and Reserves because the Reserves follow a national standard, while the rules for Guard units vary by state. This first section will cover the Reserves.

Reserve IDT travel reimbursements: The service secretary for each branch of the Reserves is allowed to authorize travel reimbursements for members who live more than 150 miles from their base. However, not all branches currently reimburse Reserve members for travel. Here are some basic rules of thumb (but be sure to verify with your unit, as some units may have unique rules):

US Air Force Reserve CommandUS Air Force Reserves: According to the Air Force Reserve Command, IDT Travel Reimbursement is available to Airmen in select DAFSCs who live more than 150 miles from their duty location.Travel Reimbursement will not exceed $300.00 per IDT round trip travel. However, the Air Force Reserve website states that reimbursement is up to individual units. Contact your unit to verify participation. Source. (last updated FY 2015)

US Army ReserveUS Army Reserves: The USAR will pay up to $300 in travel expenses to attend Battle Assembly (drill). This is in addition to Lodging-in-Kind. Previous rules limited this to select MOSs and ranks. However, I have heard these limitations were removed and reimbursements are now available to all ranks and job codes. However, I have not been able to find this in writing. I will update this when I can find a reference. (last updated FY 2015)

US Marine Forces Reserves InsigniaUSMC Reserves: Travel reimbursement open to select grades and MOS’s. When Commercial transportation is used, Reimbursement is authorized for the actual cost of transportation incurred between the member’s home and assigned RTC, not to exceed 300 dollars.  When personally owned conveyance (POC) is used, reimbursement is authorized for traveled mileage for the official distance to and from the IDT location as per Ref A Paragraph U2600 (other mileage rate). Tolls, parking fees, and other necessary expenses incurred incident to POC travel are reimbursable. Reimbursement is limited to eleven (11) round trips per marine per fiscal year.  Source. (last updated FY 2015)

US Navy ReserveUS Navy Reserves: No travel reimbursement for (IDT). Reserve Component members, regardless of paygrade, will not be paid to travel to their normal drill site per reference (e) Appendix 0, paragraph T4 045, which states, “A Reserve Component member commits an obligation to participate in a finite number of scheduled training periods annually. Inherent to this obligation is the travel between the member’s home and the location at which the member normally performs drills. The member receives no reimbursement for that travel.” Unit COs will ensure all cross assigned unit members meet and comply with reference (e). Source. (last updated FY 2014).

US Coast Guard Reserve SealUS Coast Guard: The following excerpt is from USCG Reserve Policy Manual COMDTINST M1001.28B.

Travel While on Inactive Duty. Members are not authorized to receive reimbursement for travel between their place of residence and their normal drill site when under inactive duty orders.

  1. Commands must establish normal drill sites that are validated by the District RFRS staff. If the normal drill site is different than the unit’s location, the District RFRS staff must be notified by the member’s command and noted along with the member’s PAL assignment. This is necessary to provide a legal means of determining eligibility for medical and other entitlements when members travel from their homes to the normal drill site, and for determining entitlements associated with travel between the normal drill site and the unit.
  2. Reservists who are ordered to locations other than their normal drill site must be placed on Temporary Duty (TDY) orders and receive entitlements in accordance with U4000 of reference (n), The Joint Federal Travel Regulations (JFTR). TDY orders are normally issued and funded by the member’s assigned unit, with the exception of duty such as RMPs performed for RSWE participation or medical readiness, which may be issued and funded by the District RFRS staff’s reserve appropriations manager. TDY orders shall specify the member’s normal drill site. When the member travels directly from home to the TDY station, reimbursement is limited to the lesser entitlement from either the member’s home or the normal drill site to the point at which TDY inactive duty is performed.

National Guard IDT Travel Reimbursements

The National Guard is a completely different beast when it comes to determining whether IDT travel reimbursements are available. The short answer is: ask your unit.

I know that sounds like a cop-out, but it’s the easiest way to determine the availability of travel funds. Because Guard members work for their respective state, there may be differing policies. I have seen on some forums that some units offer travel reimbursements, but I’ve heard from many individuals that it is not available at their units. Please let me know if you have any specific information or references and I will update the site accordingly.

No Reimbursements? Deduct Your Travel Expenses

Even if you aren’t able to receive a reimbursement for your travel expenses, you may be eligible claim mileage and other travel expenses on your taxes if you have to travel more than 100 miles for drill duty. You can also claim half the cost of your meals on your taxes. Those benefits don’t negate the cost of travel, but it certainly helps when you file your taxes.

What Type of Travel is Covered

Lodging. If you live outside the normal commuting distance, your unit will usually provide Lodging-in-Kind. They will either put you up in base lodging (if available), or pay for a hotel room in town. You may or may not be required to share a room, depending on your unit, your rank, and room availability. I’m not going to try and provide a standard set of rules for this, as they vary by unit.

However, most units only cover lodging for certain days, usually the night before training (if you live outside the commuting area), and after the first drill day. They may only cover one night of lodging if you live within a certain distance. They usually do not provide Lodging-in-Kind for the second day of a two day drill, or for your return trip.

If you need lodging outside of the days that are normally covered, you will need to work it out with your unit or claim a tax deduction the following year. Save your receipts!

Transportation: There are many types of transportation that qualify, including planes, trains, and automobiles. Rental cars are not normally authorized. Mileage is typically charged at the standard IRS rate, which is $0.575 per mile in 2015. Servicemembers can also claim incidental expenses such as parking, tolls, and related travel expenses.

When in Doubt, Go to the Source

Standard disclaimer – this is a topic that gets complicated quickly. Each branch has different rules, there are different rules for Guard and Reserves, and there are even different rules within certain branches, depending on your unit, AFSC/Rating/MOS, pay grade, etc.

The best place to find specific answers for your situation is through your unit. Your recruiter will be able to help you if you are considering joining a unit. Otherwise, contact the finance or travel department.

US Code. Here is the official code as written in 37 U.S. Code § 478a – Travel and transportation allowances: inactive duty training outside of normal commuting distances.

Note: Special thanks to LT. Josué Román, USCG, for sending the information on Coast Guard travel while on inactive duty.

TSA PreCheck for Military Members and Wounded Warriors

Traveling through airport security can be a hassle. Thankfully, military members are can participate in TSA PreCheck for free. This allows them to bypass the normal security line and avoid the inconvenience of taking off your shoes, belt, and jacket. You can also leave your computer and your toiletries in your carry-on bag. This is a great program that will save you a ton of time and hassle when you travel by air!

TSA PreCheck for Military Members

Wanna skip the long lines? Look for this sign.

The Transportation Security Agency (TSA) PreCheck passenger screening program was designed to allow certain individuals to bypass the normal security lines and go through the PreCheck security lines.

And if you are in the military, you should be eligible to participate in this program, free of charge. You may also be eligible to participate for free if you are a Wounded Warrior, or a DoD civilian employee. Let’s dive in and look at the TSA PreCheck passenger screening program, who it applies to, and how to use it.

What is TSA PreCheck?

TSA PreCheck offers expedited security screening at more than 120 participating U.S. airport checkpoints. Travelers can get through screening stations faster because the lines are typically shorter and move more quickly because travelers are not required to remove their:

  • Belt,
  • Shoes,
  • Light outerwear/jacket,
  • 3-1-1 compliant bag (toiletries in a zip lock baggie),
  • or laptop from their carry-on.

Who is eligible for TSA PreCheck? TSA PreCheck is available to some individuals that the TSA deems as low-risk travelers. TSA uses a different systems to determine who they consider low-risk. This can include certain frequent flyers of participating airlines, members of the TSA PreCheck application program, or participants of a U.S. Customs and Border Protection (CBP) Trusted Traveler program (Global Entry, NEXUS, SENTRI). It is also open to military members, even when you are traveling for personal reasons.

Children under age 12, traveling with an eligible adult: Accompanying passengers 12 and younger are allowed through TSA PreCheck lanes when traveling with eligible passengers (parent or guardian).

Eligible Military Members / Veterans:

TSA offers expedited screening to all members of the U.S. Armed Forces, including those serving on active duty, and serving in the U.S. Coast Guard, Reserves, and National Guard. Members of the U.S. Armed Forces can participate by using their official Department of Defense (DoD) identification number when making flight reservations. Your 10-digit DoD ID number can be found on the back of your Combined Access Card (CAC) ID (Note: your DoD ID number is not your Social Security Number).

Eligible military travelers include:

This program is not free of charge for all veterans based on their military service, however, you may be eligible for the program through other means (listed below).

What about military retirees? I have heard different reports from veterans that they were able to get the TSA PreCheck as a retiree, while others were not able to do so. If you are a retiree, you should have a DoD ID number (this will be located in your MilConnect account, or on a CAC ID Card). Use the DoD ID number as your Known Traveler Number when purchasing airline tickets. I cannot guarantee it will work, but it is worth trying.


How to Use TSA PreCheck

CAC Card - DoD NumberTo use TSA PreCheck as a military member, you will need to have a CAC ID Card. You will need to use the DoD ID number on the back of your CAC Card and enter it as the “Known Traveler Number” when making official travel or leisure airline reservations.

Once you make your reservations and print your boarding pass, you will see a TSA PreCheck Notification on your boarding pass. It should have logo that displays any of the following: “TSA Pre?™,” “TSA PRE” or “TSA PRECHK.” It will look something like the image below (image courtesy of TSA).

TSA PreCheck Boarding Passes

If your boarding pass has one of those images, then you can go straight to the TSA PreCheck line instead of waiting in the general line (unless TSA PreCheck isn’t available at that specific airport, in which case you go to the general line).

Add your DoD ID Number to Your Travel Profiles

You can save your DoD ID Number in your DTS account and with your frequent flyer programs for participating airlines. This will make it easier to ensure your number is automatically added as your Known Traveler ID. You should only have to do this once for your DTS account, and once for each frequent flyer program in which you participate. Here is a list of participating airlines.

All current military members should have a standard CAC ID Card, so they should be able to get their DoD ID number from that. If you are a retiree and don’t have a CAC Card, or if the number is not on your CAC, you may obtain it by logging on to milConnect.  You will find your ID number under the “My Profile” tab (again, I don’t know for certain this works for retirees). Here is more information from the Defense Travel Management Office.

What if You No Longer Have any Military Affiliation?

The TSA PreCheck program is open to:

  • U.S. citizens of frequent flyer programs who meet TSA-mandated criteria and who have been invited by a participating airline.
  • U.S. citizens and lawful permanent residents with a Known Traveler Number (KTN), sometimes referred to as a trusted traveler number.
  • U.S. citizens and lawful permanent residents who are members of the TSA Pre?® application program.
  • Members of the U.S. Armed Forces, including those serving in the U.S. Coast Guard, Reserves, and National Guard.
  • Department of Defense and U.S. Coast Guard civilian employees.
  • Members of the following U.S. Customs and Border Protection (CBP) trusted traveler programs:

You can also apply through the TSA PreCheck application program. This has an $85 non-refundable fee, which is used to cover the cost of the associated background checks.

Photo Credit: Wayan Vota n Flickr. CAC Card image and Boarding Pass images from TSA.

2015 Military Compensation and Retirement Modernization Commission Recommendations – Big Benefits Changes Coming? (Podcast 013)

Every few years, the military takes a deep look at the pay, benefits, and other forms of compensation given to military members and their families. On January 29, 2015, the Military Compensation and Retirement Modernization Commission released their recommendations for changing military pay and compensation. The report was two years in the making, is approximately 300 pages long, and is filled with reports, studies, and recommendations from a nine member panel.

There were 15 recommendations made, along with background information on the recommendations, why they make the recommendations, and the impact these recommendations will have on servicemembers and their families.

Big Proposals: Change Military Retirement Benefits, Dismantle TRICARE and replace it with a commercial health care program, only allow Tuition Assistance Benefits for Professional Development Courses, and more.

2015 Military Compensation and Retirement Modernization Commission Recommendations

2015 Military Compensation and Retirement Modernization Commission Recommendations

What you need to know about this report: First of all, this report is not a change in the law, or even a proposal for a new law. This is simply a proposal made to our Congressional leaders. It is up to our lawmakers to decide if, and when, they will propose any of the changes as new laws. As with all proposals for changes to military and retiree benefits, we can expect there to be some time before anything happens (if it does), and in some cases, there may be backlash from some of the military lobbying groups. That said, most of these proposals seem to be fairly even-handed and well-balanced.

Will your benefits be grandfathered in? When it comes to retirement pay, your benefits should be grandfathered in, so they likely wouldn’t change. Congress tried to change retirement benefits last year, but there was a huge backlash. The change never happened. Other benefits, such as health care, base-level benefits, and other benefits may be subject to change.

About the MCRMC Proposed Changes

As mentioned, there are 15 proposed changes to military and retiree benefits. They were broken down into three categories in the report:

  • Pay & Retirement Recommendations
  • Health Benefits Recommendations
  • Quality of Life Recommendations

We will walk you through these recommendations and provide a little commentary on them. Keep in mind, these haven’t even been proposed as law at this time. So there is no impending action on these items at the time of publication.

Download the 2015 MCRMC Report

You can download the report here, or you can view the full report below. A summary of the major points is below the viewer.

Report of the Military Compensation and Retirement Modernization Commission

Pay and Retirement Recommendations

What follows are the recommendations from the committee (in bold and italics, with page reference). The text below the recommendations is a deeper explanation, or some of my thoughts on the recommendations.

  • Recommendation 1: Help more Service members save for retirement earlier in their careers, leverage the retention power of traditional Uniformed Services retirement, and give the Services greater flexibility to retain quality people in demanding career fields by implementing a modernized retirement system. 19
  • Recommendation 2: Provide more options for Service members to protect their pay for their survivors by offering new Survivor Benefit Plan coverage without Dependency and Indemnity Compensation offset. Page – 42
  • Recommendation 3: Promote Service members’ financial literacy by implementing a more robust financial and health benefit training program. Page – 46
  • Recommendation 4: Increase efficiency within the Reserve Component by consolidating 30 Reserve Component duty statuses into 6 broader statuses. Page 52

Recommendation 1 – Pay and Retirement Recommendations: There were no recommendations made for changing base pay. So for now, we can accept the base pay system as the status quo. However, there may be some other benefits changes, which we will address later.

Big changes coming for retirement pay? Recommendation 1 is perhaps the biggest game-changer listed. Unfortunately, you don’t get much of an idea what a “modernized retirement system” is unless you dive into the report. Several years ago, the Defense Business Board released a plan for a modernized retirement plan, which is similar to the plan proposed by the MCRMC.

The MCRMC plan calls for changing the 20-year fully-vested pension to a hybrid retirement system that uses the Thrift Savings Plan, a Career Continuation Bonus, and a pension. Retirees under the new plan would also have a choice on how they receive their retirement pay.

  • TSP Contributions: Under the plan, military members would be automatically enrolled in the Thrift Savings Plan (they can opt-out, but would have to do so annually). They would begin receiving matching contributions from the military starting at year 2, and would receive matching contributions up to 5% of their pay.
  • Continuation Pay Bonus: Members would receive a bonus for reenlisting (or re-upping) at their 12 year mark. This would be equal to 2.5x their monthly pay.
  • Reduced Pension: The pension would be reduced to 2% per year of service, instead of the 2.5% per year of service under the current High-3 retirement system. The difference is a 40% pension at 20 years as opposed to a 50% pension.
  • A choice in how and when retirement pay is taken: Retiring troops would be able to choose one of three retirement payment plans: they can take the immediate monthly annuity, similar to the current plan; they could take a lump sum payment with a smaller monthly annuity, or they could take a larger lump sum with no immediate annuity. Those who take the lump sum payment would be eligible to receive the full annuity they would have had once they become eligible for Social Security Benefits.

Pros & cons to retirement proposal: There are a lot of pros and cons to this hybrid plan. The big benefit is that over 8 in 10 military members leave the service with no military retirement benefits (only what they have saved through their own TSP account). The proposed plan would give the military the funding to contribute to TSP accounts for all military members over 2 years in service, and give members something to take with them when they leave the service (TSP accounts can be transferred when you leave the military).

Current servicemembers and retirees would be grandfathered into their current retirement plans under the proposal. However, current servicemembers would be able to move to the new plan if they chose to do so. The proposal was more detailed than I can cover in this section, so I encourage you to read the full proposal for more information. I did not see any mention changes to the Guard or Reserves retirement plans, but it’s possible I might have missed it.

Recommendation 2 – Survivor Benefit Plan: This is going to be a very case-specific situation, and is more detailed than I can go into in this article. But basically, the recommendation gives retirees the option of keeping their current survivor benefit program plan, or paying more into the SBP plan to avoid the Dependency and Indemnity Compensation offset. You would need to see if this applies to you, then run the numbers to see if it is a good deal or not.

Recommendation 3 – Financial and Health Literacy: I love this idea – financial literacy is not taught well in the US in most school systems. And many military members struggle with their finances. The same goes for more in-depth health training. I support this idea 100%.

Recommendation 4 – Consolidate Reserve Component Duty Statuses: I was shocked when I learned there were 30 duty statuses for members of the Reserve Component. Seriously? Streamlining this from 30 to 6 seems like a great idea (at least on the surface). I’m sure there will be growing pains, but the long-term benefits should be found through fewer pay and benefits problems, reduced paperwork, etc.

Health Benefits Recommendations

Health care is a hot topic both in and out of the military. And the changes proposed by the Military Compensation and Retirement Modernization Commission are big—affecting active duty, family members, Guard & Reserve, and Retirees. Here are the recommendations, with my thoughts below:

  • Recommendation 5: Ensure Service members receive the best possible combat casualty care by creating a joint readiness command, new standards for essential medical capabilities, and innovative tools to attract readiness-related medical cases to military hospitals. Page – 57
  • Recommendation 6: Increase access, choice, and value of health care for active-duty family members, Reserve Component members, and retirees by allowing beneficiaries to choose from a selection of commercial insurance plans offered through a Department of Defense health benefit program. Page 79
  • Recommendation 7: Improve support for Service members’ dependents with special needs by aligning services offered under the Extended Care Health Option to those of state Medicaid waiver programs. Page 120
  • Recommendation 8: Improve collaboration between the Departments of Defense and Veterans Affairs by enforcing coordination on electronic medical records, a uniform formulary for transitioning Service members, common services, and reimbursements. Page 127

Recommendation 5 – Medical Readiness: Recommendations to improve health and combat-casualty care. Topics include, training, facilities improvement, joint medical operations, and more. There is an emphasis on joint training and standardized procedures, as well as maintaining proficiency in treating battlefield injuries. Overall, these appear to be positive recommendations, but they lead to the next recommendation, which is a big one.

Recommendation 6 – Dismantle TRICARE as we Know it: Told you it was big. The report basically states TRICARE has become inefficient, it’s too expensive, and the quality has deteriorated. The Panel recommends giving military members and dependents access to commercial insurance health insurance programs. The proposal would keep TRICARE in place for active duty servicemembers, but give access to commercial health insurance plans to family members, members of the Guard / Reserves, and retirees (except TRICARE for Life recipients, who would remain on TFL).

The new proposed health care plan would be similar to the health care plans in place for federal employees and would be managed by the Office of Personnel Management rather than the Department of Defense. Military members would receive a Basic Allowance for Health Care (BAHC), to pay for the new health insurance options. The goal would be to cover all medical expenses, and BAHC rates would be based on locality and the cost of the available options. The process would be interesting, as the proposal calls to pay a portion of the BAHC to the insurance provider, and the rest to the family member to cover copays and out of pocket expenses.

Recommendation 7 – Improve Special Needs Care: This would provide additional medical coverage to servicemembers with family members who have special needs.

Recommendation 8 – Improve Collaboration between DoD and VA: The DoD and the VA don’t coordinate very well right now, so any mandates to do so seem like they would be in the best interest of servicemembers. Standardizing the flow of information, using a standard formulary, and improving coordination should reduce expenses, errors, and frustration.

Quality of Life Recommendations

Almost half of the recommendations are for quality of life. Some of these could be game changers for many military members, retirees, and their families. Let’s jump in.

  • Recommendation 9: Protect both access to and savings at Department of Defense commissaries and exchanges by consolidating these activities into a single defense resale organization. Page 141
  • Recommendation 10: Improve access to child care on military installations by ensuring the Department of Defense has the information and budgeting tools to provide child care within 90 days of need. Page 152
  • Recommendation 11: Safeguard education benefits for Service members by reducing redundancy and ensuring the fiscal sustainability of education programs Page 161
  • Recommendation 12: Better prepare Service members for transition to civilian life by expanding education and granting states more flexibility to administer the Jobs for Veterans State Grants Program. Page 173
  • Recommendation 13: Ensure Service members receive financial assistance to cover nutritional needs by providing them cost-effective supplemental benefits. Page 180
  • Recommendation 14: Expand Space-Available travel to more dependents of Service members by allowing travel by dependents of Service members deployed for 30 days or more. Page 189
  • Recommendation 15: Measure how the challenges of military life affect children’s school work by implementing a national military dependent student identifier. Page 192

Recommendation 9 – Combine the Commissary and Exchanges: This is another big recommendation. The Commissary currently sells items at cost, plus 5%. This makes food and other good very inexpensive compared to many civilian stores. The Exchanges are a for-profit organization, but they funnel much of the profits back to the bases for Moral, Welfare, and Recreation activities. This proposal would combine the two agencies to help achieve cost savings. There are pros and cons to this proposal. By law, Commissaries can only sell groceries. Under a combined umbrella, Commissaries could still sell groceries at cost-plus 5%, but they could also sell non-grocery items they could resell at a profit (for example, things like plates, silverware, baby items, alcohol, and more). There are a lot of unknown details in this proposal, but there has been a push for this over the last couple years. So we may see something happen here.

Recommendation 10 – Increase On-Base Child Care Options: Child care has been a big problem on many installations, primarily due to unavailability and long waiting lists. The DoD doesn’t have a good way of tracking the number of people on wait-lists, or the average time they are on the wait-list. Couple that with a hiring freeze on many installations, and many military families aren’t able to get access to on-base child care (which can often be substantially less expensive and more flexible than off-base options).

Recommendation 11 – Education Benefits: This proposal calls for consolidation of the available education plans, changing the Post-9/11 GI Bill Transfer Rules, limiting Tuition Assistance use to professional development courses only, and preventing veterans from receiving unemployment benefits while also receiving Post-9/11 GI Bill benefits (which is currently allowed).

  • The proposal calls for the sunsetting of the Montgomery GI Bill and REAP programs, which have been superseded by the Post-9/11 GI Bill, which is a more valuable benefit, and doesn’t require members to pay into the program.
  • The proposal also calls for changing the minimum service requirements for transferring the GI Bill to dependents from 6 years of service to 10 years of service, and no longer allowing dependents to receive BAH (after October 1, 2017, to allow for current dependents to finish their schooling based on their current budgets).
  • The proposal calls for limiting Tuition Assistance benefits for professional development only, because servicemembers have access to the GI Bill for taking college classes. There are several more highlights, but these are the biggest in this section.

Recommendation 12 – Military Transition Programs: The military to civilian transition is difficult for many veterans (I know it was for me!). Anything that makes it easier for transitioning veterans is a win in my book!

Recommendation 13 – Food Stamps and Supplemental Nutrition Benefits: The Panel recommends getting rid of the Family Subsistence Supplemental Allowance (FSSA), for military members stationed stateside. FSSA is similar to food stamps (also known as Supplemental Nutrition Assistance Program (SNAP)). FSSA is only available to military members. Why ditch it? It was used by fewer than 300 people last year. The recommendation is to replace it with the SNAP for those based in the US, and replace it with something else for those stationed overseas. It is also easier for servicemembers to qualify for SNAP than FSSA, making FSSA a redundant program. Servicemembers would still be cared for, it would just come through a different program.

Recommendation 14 – Expand Space-A Travel: Right now, family members must travel Space-A with the servicemember unless the servicemember has been deployed 120 days or longer. This proposal would reduce the deployment time frame to 30 days, making it easier for family members to travel Space-A. Sounds good to me!

Recommendation 15 – Measure military children’s schooling: The concern is that being a military dependent makes school more difficult for students. This proposal would place an identifier on each student in DoD schools and track their progress through the system.

Overall Thoughts on the MCRMC Recommendations

All too frequently we hear proposals for changes to military pay and compensation and the knee jerk reaction is to throw our hands in the air and cry foul. But the Military Compensation and Retirement Modernization Commission took a very balanced view of many aspects of military life, including pay, benefits, retirement, health care, education, dependent issues such as day care and education, transition programs and more. Overall, the recommendations make sense.

Will all the recommendations be enacted? Almost certainly not. Congress rarely works that way. But we could certainly see some changes from this report. And some of them could be beneficial. And some might have a prolonged adjustment period. But at the end of the day, the Panel appears to have made recommendations with the best interests of servicemembers, their families, and the military in mind. It will be interesting to see what comes of these recommendations.

How to Get a Medical Waiver to Join the Military (Podcast 012)

Joining the military is not like joining any other organization. And the application process to join the military is unlike almost any other job application process. Before you can join the military, you need to fill out a host of forms and fill out dozens of documents, including your health history, a background check, and more. Today, we’re going to focus on your health history.

How to get a medical waiver to join the military

Whether you are applying to the military for the first time, or you are thinking about going back in after a break in service, you need to fill out a medical prescreen form called the 2807-2 Medical Prescreen of Medical History Report (PDF) before you can even apply to take a military physical. There are many reasons for this, but the big one is to save everyone a lot of time and money. The military has very strict health requirements to ensure that people joining the military are physically fit for service.

Do you have a Va Service-Connected Disability Rating? It may be possible to join the military with a VA disability rating, depending on your specific condition(s). Use the following process to understand how the medical waiver process works.

How to Fill Out Form 2807-2

The form is fairly self-explanatory, and it has instructions printed on it. That said, you want to take your time when filling it out. It is very in-depth and you want to ensure it is accurate before you submit it to your recruiter. Your recruiter will then submit your 2807-2 and other information to MEPS, the Military Entrance Processing Station. This is the command that processes all military entrance physicals.

Important: If you mark “Yes” on anything in section 2, you must submit supporting information. Better yet, it is highly recommended that you submit supporting documentation from a medical professional stating your condition and that you are fit for service. Failure to do so will increase the chances that your 2807-2 is kicked back to you with a medical disqualification. (You may still get medically disqualified, but including the information will help smooth the process when applying for a medical waiver).

Permanent and Temporary Disqualifications

MEPS will either accept or decline your prescreen request. If it is accepted, you will be able to process through MEPS where you will take a physical where you will either pass or fail. If your 2807-2 is declined or you fail your physical at MEPS, you will receive either a Temporary Disqualification (TDQ) or a Permanent Disqualification (PDQ). Don’t let those terms scare you away.

A Temporary Disqualification simply means the physical condition is temporary and you cannot process through MEPS because of the medical condition. This could be something as simple as a broken finger. They can’t allow you to join the military with a broken bone. But it is classified as a temporary condition because it will heal. A TDQ will delay your request to process for a military physical until your condition has healed and you can prove the condition no longer affects you.

A Permanent Disqualification is for a medical condition that is permanent. A surgery, for example, is a permanent condition because it cannot be undone. A surgery doesn’t necessarily mean you cannot serve, it just means MEPS cannot process your 2807-2 without additional information. There are other reasons for a PQD, and each situation will be unique. Some issues are eligible for a medical waiver, while others are not.

If you fail your MEPS physical or your Medical Prescreen Form (2807-2) is kicked back with a medical disqualification, then you may, or may not, have the option to apply for a waiver, depending on the reason(s) for your PDQ(s).

Applying for a Medical Waiver – Get Familiar with the DODI

Once your 2807-2 has been rejected by MEPS and you have been given a PDQ, you can start the process of applying for a medical waiver (if your condition is waiverable). Not all medical conditions are eligible for a medical waiver.

To get a head start on the waiver process, you should get familiar with the DODI (Department of Defense Instruction for Medical Standards for Appointment, Enlistment, or Induction in the Military Services), (PDF). This is the official document used by MEPS doctors to determine medical eligibility for military applicants.

If you received a PDQ, it should include a PULHES Code, which is a standardized medical code used to rate your physical condition(s). You can use these codes to look up your condition(s) in the DODI to see if the condition(s) are waiverable.

Important: This is where you need to step up and do some research. Most recruiters don’t have the time to hold your hand through the application process. Spending time on your end will make it easier for your recruiter to work with you to help you get a waiver. Remember, each recruiter is different, and most are willing to work with you if you are willing to work with them. And helping them with their job shows you are dedicated and motivated to join the military.

Unfortunately, not all medical conditions are waiverable…

Some Medical Conditions Aren’t Eligible for Waivers

I wish I could tell you that all you had to do to get a waiver approved was fill out a form, tell the military you are a hard worker, and get a couple character references. Unfortunately, that isn’t the case.

The military has some very firm standards for which types of medical waivers they will approve and will not approve. And the decision is completely out of your hands. And in many cases, you cannot appeal the decision. It is simple and final.

I won’t try to list all the medical conditions for which you cannot receive a waiver, because it is extensive. Some common maladies include having a history of asthma, ADD (if taking certain medications), diabetes, drug dependency, severe nut allergies (especially peanuts), problems with certain organs, certain skin conditions, and much more. The best thing to do is download a copy of the DODI mentioned above, and research your medical conditions.

Again: there are some conditions for which there are no waivers.

Applying for a Medical Waiver to Join the Military

Once you get your 2807-2 back from MEPS and you look through the TDQ(s) or PDQ(s) they gave you, you will need to prepare your case for a medical waiver. Basically, you will need to get a doctor or medical specialist to review each item for which you received a TDQ or PDQ. The doctor will need to write a note on his or her letterhead with the date, your medical history for that condition, your current condition, and whether or not you are physically capable of serving in the military, based on his or her assessment.

You will need to pay for the medical examinations our of your pocket. The military will not cover this expense.

Once you have these letters, you will need to submit them and a new 2807-2 to your recruiter. Your recruiter will then start the waiver process by sending the forms and supplemental information to the Surgeon General’s Office for your branch of service. The Surgeon Generals Bureau may or may not request additional information.

The Medical Waiver Process Can Be Time Consuming

I had to get medical waivers to join the Air National Guard – the waivers were required because I had two knee surgeries while I was on active duty. Because I had a history of surgery, I needed to get a physical from an orthopedic surgeon who looked at my health history, gave me an exam, and stated I was physically fit to serve again. The process for me to join the ANG took about 6 months from start to finish. It went like this:

  • Submit 2807-2. It was declined by MEPS with multiple PDQs.
  • Research PULHEES codes in DODI. Realize each condition was waiverable.
  • Set up medical appointments with specialists.
  • Get exams and letters from doctors on their letterhead.
  • Resubmit 2807-2 with appropriate letters from doctors.
  • 2807-2 was again declined by MEPS; my recruiter then sent in the 2807-2 and my doctors letters to the Surgeon General’s Office and requested a medical waiver to take the MEPS physical.
  • Waiver approved; scheduled for a physical at MEPS.
  • Physical declined by MEPS (this will happen almost 100% of the time, because of the PDQs). My physical was good with the exception of the items we already knew about. MEPS recommended a medical waiver based on my physical and supporting documentation.
  • MEPS forwarded my physical and all documentation to the Surgeon General’s Office for a waiver.
  • Waiver Approved.

This process can take months, depending on the complexity of your case, your medical conditions, how long it takes to get your medical exams and letters, how busy MEPS and the SG’s office are, and other factors (the summer is the worst time because this is when MEPS processes thousands of recent high school and college graduates).

There is No Appeal Process if Your Waiver is Denied

Here is the deal with waivers – you either get a medical waiver or you don’t. You can’t appeal. The Surgeon General’s office is the appeal. If they deny you the opportunity to serve, then that is the final answer. Writing to your Congressman or Senator won’t enhance your chances of joining the service. It just won’t happen.

However, depending on your medical condition, there may be other options you can try. For example, each branch of the military, including the Guard and Reserves, has a different Surgeon General’s Office. So if you have a borderline case, you might consider joining another branch of service. You might even consider a career in the Guard or Reserves instead of joining on active duty.

But be careful not to waste everyone’s time. If your condition is not waiverable, don’t go through the application process again – it wastes everyone’s time and money. The only time it is worth going through this process again is if you have medical conditions that are waiverable, but for one reason or another, the branch you applied to decided not to accept you at this time.

There are reasons this can happen. For example, if some branches of the military aren’t having trouble meeting their quotas, they may not need to take someone with a history of health conditions. All things being equal, they will take the person who doesn’t require waivers. (it’s faster, easier, and cheaper to get this person into uniform, and historically, they are more likely to finish training).

But some other branches may be having a more difficult time meeting their quotas, or they may be more open to putting prospective troops through the waiver process. So you may have luck applying to a different branch of the service, or applying to the Guard or Reserves. In fact, I have heard it can be easier to join the Guard and Reserves if you need medical waivers. Again, it’s only worth pursuing this avenue if your medical condition(s) are waiverable.

Final note: Please do not try to apply to more than one branch of the military at the same time. It will cause red flags in the system and may prevent you from being able to join. Exhaust all options with your first application before trying to apply to a different branch of the military. Best of luck!

2015 IRS Tax Refund Schedule (2014 Tax Year)

When it comes to filing a tax return, there are a few questions that people care about more than any other – how much am I paying on taxes, how much will I get back in my tax refund, and when will I receive it? Everything else, the say, is just details.

There is no quick and easy answer to the first two questions, but we can give you a rough idea of when you will receive your tax refund, but only if you file your federal taxes electronically using a software program or with the IRS E-File. Expect longer delays if you file your return on paper, because it takes longer for the IRS to process your paperwork. The tax refund chart below offers more information on when to expect tax refunds.

Learn how military members can file taxes for free.

IRS E-File Schedule for Check Refunds and Direct Deposits

where's my refund - IRS refund schedule

When you receive your refund depends on how and when you file.

The following tax refund table is based on previous refund tables released by the IRS to help tax payers know when they should receive their tax refund. Due to changes in the IRS auditing system, they no longer release a full schedule as they did in previous years. The following chart is based on estimates from past years.

To use the refund chart:

  • Use the left hand column to look up the date your tax refund was accepted
  • Use the middle or right column to look up when you should receive your refund (depending on how you requested your refund – direct deposit or paper check).

If you filed your taxes with E-File, you should receive a confirmation that your tax return was accepted by the IRS. This date will go in the left column. If you didn’t file your taxes electronically, then this chart may not be useful for you for two reasons: you won’t have a confirmation date regarding when your tax return was accepted, and paper tax returns are manually entered by IRS employees, so the process takes longer.

You will also note that this chart covers dates beyond the traditional filing date. If you file after April 15, 2014, then you should file a tax extension request. It’s simple, and can potentially save you a lot of money in penalties. Note: Some military members may be eligible for additional tax deadline extensions if they were deployed or served overseas during the tax year.

Tax Return Accepted By IRS before 11:00 am between… Direct Deposit Sent* Paper Check Mailed*
Jan 20, 2015 (first day IRA accepts returns) and Jan 30, 2015 Feb 4, 2015 Feb 6, 2015
Jan 30 and Feb 06, 2015 Feb 11, 2015 Feb 13, 2015
Feb 7 and Feb 13, 2015 Feb 18, 2015 Feb 20, 2015
Feb 14 and Feb 20, 2015 Feb 25, 2015 Feb 27 , 2015
Feb 21 and Feb 27, 2015 Mar 4, 2015 Mar 6, 2015
Feb 28 and Mar 06, 2015 Mar 11, 2015 Mar 13, 2015
Mar 07 and Mar 13, 2015 Mar 18, 2015 Mar 20, 2015
Mar 14 and Mar 20, 2015 Mar 25, 2015 Mar 27, 2015
Mar 21 and Mar 27, 2015 Apr 1, 2015 Apr 3, 2015
Mar 28 and Apr 03, 2015 Apr 8, 2015 Apr 10, 2015
Apr 04 and Apr 10, 2015 Apr 15, 2015 Apr 17, 2015
Apr 11 and Apr 17, 2015 Apr 22, 2015 Apr 24, 2015
Apr 18 and Apr 24, 2015 Apr 29, 2015 May 1, 2015
Apr 25 and May 01, 2015 May 6, 2015 May 8, 2015
May 02 and May08, 2015 May 13, 2015 May 15, 2015
May 09 and May 15, 2015 May 20, 2015 May 22, 2015
May 16 and May 22, 2015 May 27, 2015 May 29, 2015
May 23 and May 29, 2015 Jun 3, 2015 Jun 5, 2015
May 30 and Jun 05, 2015 Jun 10, 2015 Jun 12, 2015
Jun 06 and Jun 12, 2015 Jun 17, 2015 Jun 19, 2015
Jun 13 and Jun 19, 2015 Jun 24, 2015 Jun 26, 2015
Jun 20 and Jun 26, 2015 Jul 1, 2015 Jul 3, 2015
Jun 27 and Jul 03, 2015 Jul 8, 2015 Jul 10, 2015
Jul 04 and Jul 10, 2015 Jul 15, 2015 Jul 17, 2015
Jul 11 and Jul 17, 2015 Jul 22, 2015 Jul 24, 2015
Jul 18 and Jul 24, 2015 Jul 29, 2015 Jul 31, 2015
Jul 25 and Jul 31, 2015 Aug 5, 2015 Aug 7, 2015
Aug 01 and Aug 07, 2015 Aug 12, 2015 Aug 14, 2015
Aug 08 and Aug 14, 2015 Aug 19, 2015 Aug 21, 2015
Aug 15 and Aug 21, 2015 Aug 26, 2015 Aug 28, 2015
Aug 22 and Aug 28, 2015 Sep 2, 2015 Sep 4, 2015
Aug 29 and Sep 04, 2015 Sep 9, 2015 Sep 11, 2015
Sep 05 and Sep 11, 2015 Sep 16, 2015 Sep 18, 2015
Sep 12 and Sep 18, 2015 Sep 23, 2015 Sep 25, 2015
Sep 19 and Sep 25, 2015 Sep 30, 2015 Oct 2, 2015
Sep 26 and Oct 02, 2015 Oct 7, 2015 Oct 9, 2015
Oct 03 and Oct 09, 2015 Oct 14, 2015 Oct 16, 2015
Oct 10 and Oct 16, 2015 Oct 21, 2015 Oct 23, 2015

*Note: Again, these are estimated dates based on previous tax refund schedules released by the IRS. The IRS no longer publishes these tax refund charts, due to their auditing process.

Keep in mind it may take a few days for your financial institution to make your deposit available to you, or it may take several days for the check to arrive in the mail. Keep this in mind when planning to use your tax refund. The IRS states to allow for 5 additional days for the funds to become available to you. In almost all cases a direct deposit will get you your tax refund more quickly than 5 days, and in some cases will be available immediately.

How Should You Request to Receive Your Refund?

The IRS gives you three options for receiving your refund. You can choose to receive your refund in a direct deposit (you can split your refund and have it sent to up to three banks), you can have a paper check sent to your home, or you can choose to buy US Savings Bonds with your tax refund. You can also apply a refund to any future taxes owed. This is a popular choice among some small business owners who are required to pay estimated taxes. Of the three refund options available to you, the Direct Deposit option is the fastest and safest option.

*Note: Some tax software companies also offer the option of receiving a tax refund on a prepaid debit card. I’m not particularly fond of this option, but it is available to some tax filers. In this case, the refund is first sent to the tax preparation company, then they issue you the prepaid debit card.

Tax Refund Schedule for Extensions and Amended Tax Returns

The refund schedule should be the same if you filed for a tax extension, however, there is no official schedule for tax refunds for amended tax returns. The above list only includes dates for e-filing an original tax return. Amended tax returns are processed manually, and often take 8-12 weeks to process. If you do not receive an amended tax return refund within 8 weeks after you file it, then you should contact the IRS to check on the status.

How to Check the Status of Your Tax Return

You should be able to check the status of your tax refund roughly 72 hours after your receive confirmation form the IRS that they have received your tax refund via E-File. You will need to wait at least 3 weeks if you mailed in your tax return. The best way to check the status of your federal tax refund is to visit the Where’s My Refund page at the IRS website, or, call 1-800-829-1954, or 1-800-829-4477, or 1-800-829-1040 and inquire about your tax return status with an IRS a customer service representative. Note that the IRS only updates tax return statuses once a week, on Wednesdays.

Get a Larger Tax Refund Next Year

If you want a bigger tax refund next year, then there are a few ways you can increase the amount of money the government will give you as a tax refund. One of the easiest ways is by contributing to a tax-deferred retirement plan such as a 401k, the Thrift Savings Plan, or by opening a Traditional IRA, which allows you to deduct up to an additional $5,500 on your taxes each year (up to $6,500 if you are age 50 or older). You can open an IRA in a variety of locations, including banks, brokerage firms, independent advisors, and more.

Update: IRS Announces Some Tax Refunds Will Be Late

The IRS recently upgraded their computer systems to prevent tax refund fraud. This may affect people who filed early in the year. Find out if your tax refund will be late.

National Guard and Reserves Retirement Benefits Guide (Podcast 011)

The Military Wallet Podcast on iTunesToday’s article and podcast both cover National Guard and Reserve retirement benefits. Retiring from the Guard or Reserves has some similarities to an active duty retirement, but there are some very important differences, including when you will receive your military pension, how much you will receive, when you will receive health care coverage under TRICARE, and a few other important differences.

National Guard and Reserves Retirement Benefits GuideThe podcast and this guide both feature excellent information for current members of the National Guard or Reserves, Gray Area Retirees (members of the Guard or Reserves who have reached retirement, but haven’t reached age 60), and active duty servicemembers who aren’t sure if they will remain on active duty through a full retirement. Military retirements can complicated, so you might even learn something if you already a retired Reservist or Guard member!

Note: If you haven’t considered joining the Guard or Reserves, we have a previous podcast that discusses Joining the Guard or Reserves. There is a lot of great information in both that podcast and article, and this podcast and article.

In our interview, and in this guide, you will learn more about:

  • How to qualify for retirement from the Guard or Reserves
  • Why age 60 is an important birthday for Guard and Reserve retirees
  • Earning Retirement Points
  • Military retirement pension plans – 3 Types
  • How to calculate a Guard or Reserve pension
  • How your Guard or Reserve pay base can grow, even after you retire
  • The power of Cost of Living Adjustments (this is much more valuable than you think!)
  • Health care options through TRICARE
  • Base access, shopping, & activities
  • and other valuable retirement benefits.

The Military GuideFeatured Guest – Doug Nordman. Our guest for this episode is Doug Nordman, military retiree and author of The Military Guide to Financial Independence and Retirement. This book had a large impact on me and helped push me toward joining the Air National Guard after an 8 year break in service. Doug also runs a blog called The Military Guide where he writes about a variety of topics related to military benefits, veterans topics, retirement, and personal finance.

Doug retired from active duty, but his wife retired from the Reserves, giving Doug a good overview of how retirement works from both active duty, and the Guard and Reserves. He offers tips on how to maximize those benefits.

About this guide: The following article covers many of the facts in the podcast, but due to space constraints, leaves out some of the personal anecdotes, specific examples, and additional information. I recommend listening to the podcast if you have the time, and bookmarking this as a resource for future reference.

How to Qualify for Retirement from the Guard or Reserves

In general, you need to serve 20 years to be eligible for military retirement benefits. This is true for those who serve on active duty, or in the National Guard or Reserves. Members of the Guard and Reserves need 20 “Good” years, or “Satisfactory” years to qualify for a military retirement. A Good Year is defined as earning 50 or more points in a year. We will cover earning points in just a moment.

Exceptions to the 20 year rule: There are some situations when you may be eligible to retire a little early. One example is the Temporary Early Retirement Authority, or TERA, which is often used during periods of Force Shaping and Reductions in Force (RIF). Under TERA, some servicemembers are eligible to retire with as few as 15 years of active duty service. However, they also receive a smaller pension, both based on years served, and because there is a multiplier used that decreases the final pension calculation. Other exceptions for early retirement can be made for medical reasons, or under some other limitations. But in general, we are working with the assumption that it takes 20 or more years of service to be eligible for a military retirement.

The Importance of Reaching Age 60

Turning 60 is an important birthday for Guard and Reserve retirees. This is the age when Reserve Component retirees become eligible for all military retirement benefits, including pay and health care. Prior to age 60, retired Guard and Reserve members are only eligible for certain retirement benefits, including base access, shopping at the Commissary and Exchanges, and certain other benefits. These retirees are often referred to as “Gray Area” Retirees. You will hear this term often.

Here are some important age-based notes for National Guard and Reserve retirees:

  • Gray Area Retirees – Under Age 60. Retired members of the Guard or Reserves who are not yet eligible for full military retirement benefits, most notably the pension and health care benefits.
  • Full retirement benefits – Age 60+. Once you reach age 60, you are eligible for all retirement benefits. This includes the military pension and health care benefits.
  • Early Guard or Reserve Retirement Pay. Some members of the Guard or Reserves are eligible to receive their retirement pay earlier than age 60. However, they still have to wait until age 60 to begin receiving health care benefits through TRICARE Prime (see below for more information about health care in retirement).
  • Early Retirement Eligibility. Early retirement pay can be earned by serving at least 90 days on active duty during a fiscal year after January 28, 2008. You can receive your retirement pay 90 days early for each qualifying 90 day activation (but no earlier than age 55). Here is an article that explains early retirement benefits in more detail.

Earning Retirement Points

As mentioned in the previous section, members of the Reserve Corps need 50 Points in a year to earn a Good Year toward retirement.

Members of the Guard and Reserves earn 15 participation points each year and they earn points for serving: 1 Point per Drill Period, and 1 Point for each day on active duty. Each Drill Weekend actually has 4 Drill Periods. Guard and Reserve members have a morning drill, and an afternoon drill, each 4 hours long. So a typical Drill Weekend is worth 4 Points toward retirement.

Points can also be earned through AT days (two week required annual training), being called to active duty for training, being mobilized, deploying, serving in the Honor Guard for military funerals, and by completing correspondence courses. Not all activities that earn Retirement Points also earn pay at the time you earn the points. For example, completing correspondence courses might be required to progress in your career and they earn you points toward retirement, but you may or may not be paid for completing the course. However, doing so is in the best interest of your career.

In any given year, a member of the Guard or Reserves can expect to earn around 75 points or more, depending on Drill participation, annual training participation, whether you were activated, and other factors. While there is no such thing as a “normal year” in the Guard or Reserves, a “base” year might look something like this:

  • 15 Points – Annual Participation
  • 48 Points – 12 Monthly Drills (4 Drill Periods per month)
  • 15 Points – Annual Training (this can vary based on your unit)
  • Additional Points as earned (training, correspondence courses, Honor Guard, mobilizations, etc.).

All your points are maintained by your parent service and work toward calculating your retirement pension. We will cover this in a moment. First, let’s look at how types of military pension plans and other factors used in your retirement calculations.

Military Retirement Pension Plan Types

National Guard and Reserve retirement pay is almost always referred to as “Reserve Retirement Pay” regardless of whether you served in the Guard or Reserves. It is also sometimes referred to as “Non-Regular Retirement Pay. That said, the Reserves use the same retirement plans as active duty servicemembers. The only difference is how the pay is computed. Let’s look through the different types of retirement plans, then discuss how to calculate a Guard or Reserve pension.

There are 3 Main Types of Military Retirement Pay Plans:

  • Final Pay / High Pay – for servicemembers who entered the military before Sep. 8, 1980. Final Pay uses your last pay grade to calculate your retirement pension.
  • High 3 – for servicemembers who entered the military after Sep. 8, 1980. High 3 pay takes the average of your highest three years of base pay.
  • REDUX – an elective retirement option for servicemembers who entered the military after Sep. 8, 1980. REDUX offers servicemembers a $30,000 Career Status Bonus at year 15, in exchange for a lower retirement multiple and lower COLA.

We focus almost exclusively on the High 3 Retirement Plan in the podcast because most current servicemembers and recent retirees are eligible for this plan. REDUX is not discussed other than to say not to take it (REDUX is almost never a good idea).

Military Pensions are from Your Base Pay Only

Military pensions are calculated only from your base pay. This is important to know, because military paychecks often include benefits such as BAH and BAS, and may include other incentive or bonus pay such as flight pay, sea pay, danger pay, or other special duty pays or benefits.

This can cause some sticker shock for many active duty members when they first enter retirement because their pension checks are often much smaller than they anticipated. The sticker shock may not be as large for members of the Guard or Reserves, because they are used to seeing Drill Pay checks, which don’t usually include these other benefits at the full monthly rate, and it can often be years, or even decades before the members begin receiving their pension payments.

Calculating a Natioanl Guard or Reserve Pension

Guard and Reserve pensions are calculated slightly differently than active duty pensions. Active duty pensions are calculated by multiplying the total years of service by a multiplier of 2.5% (High-3 plan). Then you multiply that by your pay base. In the High-3 pension plan, your pay base is the average of your highest 3 years of pay (rough rule of thumb – that will equal about 95% of your final pay).

Guard and Reserve pensions are calculated in a similar manner, but there is an intermediate step that must be completed before you can calculate the final pension. We must first convert Points into years served. To do this, add up all your Points, then divide by 360. This gives you the total number of years served (the military calculates a month as 30 days to make the math easy; so each year served is 12 months at 30 days each, for a total of 360 days).

So take your total number of days served, and divide by 360, then multiply that by 2.5%. Here is a quick example: Say you have 3,150 points. Divide that by 360, then multiply by 2.5%. You get (3,150/360) * 2.5% = 21.875%. Now multiply that by your pay base (average of your high 3 years of salary).

Get a More Precise Estimate of Your Pension: Every service has an online retirement calculator that allows you to put in very granular information, including your Date of Initial Entry Into Military Service (DIEMS), your estimated retirement date, and other factors. It’s important to note that these calculators are often password protected and you need to login to your branch website get this information.

Your Guard and Reserve Pay Base Continues to Grow After Retirement

There is a little known fact about National Guard and Reserve retirement pay. Depending on how you retire from the Guard or Reserves, you can continue earning time in grade and longevity toward retirement. That means the value of your retirement can keep pace with military pay raises and inflation while you await retirement pay. But only if you choose to retire under the right classification.

Congress gives you the option of retiring awaiting pay, or resigning from the military.

Retired Awaiting Pay: Retiring Awaiting Pay is the better option from a financial perspective, but it comes with a (slight) risk. Technically, you are still eligible to be recalled to active duty in the even of a full mobilization. However, it would take a full mobilization of the entire military for you to be recalled from retirement. This is extremely rare, and didn’t even happen post-9/11.

Here is the pay off – while you are retired awaiting pay, your clock is still running on your longevity and time in service. So if you retire awaiting pay as an E-7 at 20 years, your clock keeps running to the maximum for that rank, which is 26 years of service. So you get pay increases for 6 more years in service, just for being on call. To top it off, you will receive the pay scale in effect when you turn 60, not the pay scale when you retire. So your pay has the potential to increase substantially while you wait to turn age 60.

Resigning from the Guard or Reserves: This has no risk of being recalled, however, resigning from the military will lock in your retirement check with the years of service and the pay scale in effect the year you retired. This can have a hugely negative impact on your pension, especially if you have a couple decades to wait before turning age 60!

Retired Awaiting Pay is the Way to Go! Retired members of the Reserve Corps haven’t been involuntarily recalled to active duty since WWII. Yes, it is possible to be recalled, but the odds are very small. And the financial gains can be huge.

COLA Adjustments

Your military pension is indexed for inflation through Cost of Living Adjustments (COLA). Military pensions are tied to an annual COLA based on the Consumer Price Index, or the average cost of inflation over a variety of consumer goods. This varies from year to year. In some years there is no COLA increase to retirement pay, and in other years it could 1%, 2%, or even higher.

Many people underestimate the value of these pay raises. While 1% or 2% seems like a small pay increase, these are cumulative, and they add up quickly. For example, Doug shared that his military pension has increased 27% over the last 12 years, just from COLA increases. 27% is huge!

It’s important to understand that while your pension will increase over time, it should be enough to roughly keep pace with inflation. So while the dollar amount is a lot larger, the purchasing power should be similar as when you retired. However, this is an incredibly powerful benefit, because most civilian pensions plans aren’t indexed to inflation.

Guard and Reserve Health Care in Retirement

Retired Guard and Reserve Health Care OptionsMembers of the Guard and Reserves have different health care options than active duty servicemembers and active duty retirees. While still serving in the National Guard and Reserves, members are eligible for TRICARE Reserve Select (TRS), which is a premium based health insurance program. It’s cost is very affordable, coming in at roughly $50/mo for a member, or around $205/mo for a family plan. However, you lose TRS eligibility when you retire or otherwise leave the Guard or Reserves.

Your health care options in retirement depend upon your age (Gray Area Retirees are not eligible for TRICARE Prime or Standard), where you live, and other factors. Here are the basics (and we have a full-length article listed at the end of this section which gives much more information).

  • Retiree health care options – under age 60. Gray Area Retirees are eligible for TRICARE Retired Reserve (TRR), which is similar to TRICARE Reserve Select, without any subsidies. The retiree must pay 100% of the premiums if they wish to participate in the plan. TRR premiums are roughly $361/mo for the individual, and about $961/mo for a family plan. Other health care options include employer-sponsored health care plans, or an individual health care plan, such as those you might find on the health insurance exchanges. has a lot of great options.
  • Retiree health care options – age 60-65. Guard and Reserve retirees become eligible for TRICARE Prime at age 60. This is the same health insurance plan open to active duty military members and retirees. However, retirees are only eligible for TRICARE Prime if they live within a certain distance of a military installation or regional health care center. If the retiree lives out of the area, they would only be eligible to receive TRICARE Standard.
  • Retiree health care options – age 65+. At age 65, Reserve Corps retirees are eligible to receive TRICARE for Life, which is a Medicare Supplemental Insurance Program. There are no monthly premiums for this plan.

Which plan is the best? This is where it’s a good idea to listen to the Podcast episode. Doug goes into each of these plans in more detail, and explains the associated pros and cons of each plan. Additionally, you can contact a TRICARE Ombudsman who can help you decide which plan is best for your situation. There should be one at each Military Treatment Facility, or you can contact TRICARE, and they will have someone explain things to you and help you choose. Finally, we have a full-length article discussing Retired Guard and Reserve health care options.

Additional Health Care Info Covered in the Podcast:

  • Health care for dependents
  • What if you don’t live near a Military Health Care Facility?

Other Retirement Benefits

Doug and I discuss other military retiree benefits, including access to base facilities such as the:

  • Commissary
  • Base Exchanges
  • Gyms
  • Hobby activities where available, such as the Auto Hobby Shop, Woodworking Shop, MWR facilities, movie theater, etc.

These base activities can be a great way to save money, participate in hobbies, and continue to be a part of the military community.

Military Hops – Space-A Travel: Military hops and Space-A travel are another topic we discussed. These can be a great way to see the world on the cheap. Basically, flying Space-A allows you to jump onto a military transport if there are available seats. You pay a nominal fee (usually only a few dollars). You can often find trips going all over the world, and many of the flights go out on a regular basis. There are some downsides, however. Because you are flying on a space-available basis, you may not be able to get the flight at the day or time you want. Flexibility is the key if you use Space-A travel!

There are a few differences for Space-A availability for Guard and Reserve retirees. The member is eligible to fly Space-A if they are a Gray Area retiree, but their dependents may not be eligible until the servicemember reaches age 60, which is when their retirement is on par with an active duty retirement.

Benefits for Spouses & Dependents

Benefits for your dependents, including your spouse and children, are similar going to be similar to when you were on active duty, with the exception of your health care which will depend upon your specific situation (whether you are eligible to use TRICARE Prime, or are required to use Standard). Spouses and Dependents still maintain base access and access to the Commissary, Exchanges, MWR facilities, and other base activities.

Did we miss anything? Military retirement is a huge topic, and we tried to cover as much as we could in the 40 minutes or so that we talked. I also did my best to get the main points down on paper for those who prefer to read. Please leave a note in the comments if we missed anything and we’ll address it. Thanks!

Retired Guard and Reserve Health Care Options – TRICARE & Private Health Insurance

Retired Guard and Reserve Health Care OptionsMembers of the Guard and Reserves have different health care options than active duty servicemembers and active duty retirees. While still serving in the Guard and Reserves, members are eligible for TRICARE Reserve Select, which is a premium based health insurance program. It’s cost is very affordable, coming in at roughly $50/mo for a member, or around $205/mo for a family plan.

There are very reasonable annual deductibles, coming in at $150 for an individual, and $300 for a family. The maximum out of pocket cost (also referred to as the Catastrophic Cap) is also very reasonable, coming in at $1,000 per family, per fiscal year. These rates are much more affordable than many plans you will find through an employer, and are much lower than what you would find on one of the health care exchanges (the maximum out of pocket expenses for plans on the exchanges often range from around $6,000 for an individual, up around $12,600 for a family plan).

Unfortunately, once you retire from the Guard or Reserves, you lose access to TRICARE Reserve Select. You can still participate in a TRICARE health care plan, but you would have to transfer to another plan. Let’s take a look at some of your health care options once you retire from the Guard or Reserves.

Note: Click here to learn about your health care options after leaving active duty.

Guard and Reserve Health Care Options in Retirement

Retired members of the Guard and Reserves have several retirement plans available to them, depending upon their age, and believe it or not, where they live. Let’s break this down by age, because it isn’t until age 60 that retired members of the Reserve Corps are eligible to receive TRICARE Prime, the same military health care offered to active duty retirees. Prior to age 60, retired members of the Reserve Component are referred to as “Gray Area Retirees” because they are eligible for some military retirement benefits, but not all of them (notably the pension and TRICARE Prime).

Retiree health care options – under age 60. Once a member retires from the Reserve Component, he or she loses access to the subsidized TRICARE Reserve Select plan. They become eligible to participate in the TRICARE Retired Reserve plan, which is similar to TRICARE Reserve Select, but without any subsidies, and a higher Catastrophic Cap. The retiree must pay 100% of the premiums if they wish to participate in the plan. And it’s fairly expensive, at least compared to what you may be used to. Without subsidies, TRICARE Retired Reserve comes in at roughly $361/mo for the individual, and about $961/mo for a family plan. The Catastrophic Cap for TRICARE Retired Reserve is $3,000 per family, per fiscal year. This is more expensive than TRICARE Reserve Select, but it may or may not be more affordable than anything you can find through an employer or on one of the health insurance exchanges.

Non-military health care options – under age 60. It may pay to shop around for less-expensive health insurance if you find the premiums for TRICARE Retired Reserve to be too expensive. The obvious choice is to check with your employer if they offer health insurance. You may be also able to find a less-expensive health care option on the Health Care Exchanges. has a lot of great options on the Exchanges (this is where I go to find my health insurance).

Instant Health Insurance Quotes

Retiree health care options – age 60-65. Guard and Reserve retirees generally aren’t eligible to receive health care benefits until they turn age 60, at which time they would be eligible for TRICARE Prime, which is the same health insurance plan open to active duty military members and retirees. This includes access to health care at a Military Treatment Facility on a space-available basis. However, retirees are only eligible for TRICARE Prime if they live within a certain distance of a military installation or regional health care center. If the retiree lives out of the area, they would only be eligible to receive TRICARE Standard. TRICARE Prime and Standard both have monthly premiums, and associated copays, but there are some important differences.

Retiree health care options – age 65+. At age 65, Reserve Corps retirees are eligible to receive TRICARE for Life, which is a Medicare Supplemental Insurance Program. There are no monthly premiums for this plan.

*Retirees living overseas. I recommend you contact the TRICARE customer service line to find the best option for you. There are different rules and programs for retirees living overseas, and each situation is unique.

Finding the Right Plan for You

Your choice can almost be made for you, depending on your age, and where you live. The biggest question mark for most people is how to handle health insurance coverage as a Gray Area Retiree. If you find yourself in this situation, I would sit down and compare TRICARE Retired Reserve with the options available through your employer, or through one of the health care exchanges ( lists everything you will find on the exchanges, but in my opinion has a more user-friendly interface and better tutorials that explain your options).

Once you reach age 60, it makes sense to go with TRICARE Prime or Standard. Once you reach age 65, you are no longer eligible for Prime or Standard, and must move to TRICARE for Life if you wish to continue receiving health care through the military.

More help is available: You can always contact a TRICARE Ombudsman who can help you decide which plan is best for your situation. There should be one at each Military Treatment Facility, or you can contact TRICARE, and they will have someone explain things to you and help you choose.

Here are some plan details, and links to the website:

TRICARE Reserve Select – Premiums (~$50/ mo for member; ~$205 for family plan):

TRICARE Retired Reserve – Premiums (~$391/ mo for member; ~$961 for family plan):

  • Available to Retired members or the Guard or Reserves
  • Equivalent to TRICARE Reserve Select, however, there are no premium subsidies, so you pay entire cost of premiums.
  • Available until age 60, at which time you are eligible to TRICARE Prime or Standard
  • Link to TRICARE Retired Reserve website.

TRICARE Prime – Premiums ($50/ mo for member & dependent):

  • $12 copay off-base
  • MTF – space available, but no Copay
  • Prescriptions
    • Formulary – free
    • Local pharmacy – variable
  • Only available until age
  • Only available within 40 miles or 30 minutes from a military base (cost-cutting measure) There are waivers for this.
  • Link to TRICARE Prime website.

TRICARE Standard:

TRICARE for Life age 65:

Hopefully this helps you understand your options and points you in the right direction!

Surviving a Military Paycheck Error

No system is perfect. Especially complex systems managing hundreds of thousands of unique inputs and outputs on a biweekly basis. Inputs and outputs that frequently change based on dozens of different factors that can change at a moment’s notice. Of course, the system I’m referring to is the military pay system. I’m sure you guessed that by the title of this article.

Unfortunately, the military pay system isn’t perfect. Errors can and do happen. And that’s not good when people need their paychecks to pay for basic living essentials such as food, housing, transportation, utilities, etc.

Military Paycheck Error

In most cases, military paycheck errors are minor, and quickly rectified. I served on active duty for 6.5 years, and personally experienced a couple small pay issues – an overpayment on an advance for a TDY was one such occasion. I didn’t want the advance, I was forced to take it, I was overpaid, then I had to write a check to pay back the government (or they could have withheld it from future paychecks; I preferred getting it over with right away). No long-term damage was done, but it took a couple hours out of my day and took me away from work.

But some problems are much worse. I know people who were underpaid, not paid at all, grossly overpaid and had their pay docked for the next several checks, etc. These pay problems can quickly cause a lot of damage. So let’s take a look at what you can do to help survive a military paycheck problem.

What to Do When the Military Messes Up Your Paycheck

The first step is to assess the situation. What happened? Were you not paid at all? Underpaid? Overpaid? Contact your finance department, explain the situation, and see if you can sit down with them and walk through the problem and find a solution. Many military pay problems are small, and can be resolved over the phone, or with a a quick meeting. But if your problem is bigger, you will need to do a little more work to find a resolution.

Resolving an Overpayment

Being overpaid can be almost as bad as being underpaid, because you will need to repay the excess amount of pay you received. As I previously mentioned, I was overpaid for a deployment when I was forced to take a cash advance I didn’t even want. The solution for me was easy – simply write a check to the US Treasury Department for the amount I was overpaid (I think it was in the $400 range; which was not an insubstantial sum when I was an E-3 with a take home pay of about $600 per pay period).

In other situations, you may be forced to repay more than you can write a check for in one fell swoop. In that case, your paycheck may be garnished by a certain amount each check until you have repaid the debt you now owe. This can be a big problem if you are living paycheck to paycheck, or you regularly spend your entire paycheck each month. In most cases, you can work with the finance department to spread out the overpayment over several checks. But if you were grossly overpaid, you may need to figure out some form of payment plan that doesn’t take away too much of your paycheck.

Resolving an Underpayment

Being underpaid is rough. You need to keep paying for your living expenses, even if your paycheck is light, or if it doesn’t even show up. Not being paid is rare, but not unheard of. Non-payments are most common when you are changing status (being activated, deactivated, separating from the service, receiving separation pay, or receiving an enlistment or reenlistment bonus).

Underpayments can happen for a variety of reasons, including being deployed, going through a PCS, receiving a promotion, change in status, adding dependents, change in BAH rates, becoming eligible for additional pays and bonuses, etc.

Resolving an underpayment starts with contacting your finance department, explaining the situation, and waiting for them to rectify the situation. In many cases, your pay will be resolved in one or two pay periods. But in some cases, it can take longer. Situations that may take longer are often things like bonuses, separation pay, and similar payments.

Unraveling the Impact of Paycheck Problems

Thankfully, most pay problems are small. But not all. And even small problems can quickly become big problems if they aren’t resolved quickly. And the problem with paycheck errors is the initial problem can lead to further problems, such as missing payments, adding debt, incurring finance problems, and worse. So let’s run through a few common problems and what can be done about them.

Dip into Emergency Savings. Everyone should have an emergency fund. How much you should have is up to you. But it’s best to start with at least $1,000. As a rule of thumb, I recommend everyone have at least one to three months of living expenses. That will help you manage most emergencies that pop up. If you don’t have one yet, make it your resolution to start an emergency fund. Be sure to top up your emergency fund once you have the situation resolved.

Speak to Your First Sergeant or Contact Your Service Aid Society. Your First Sergeant is your first line of defense and can help point you to resources on base, or in the local community. This can include a financial counselor or other specialist. Each branch of the service also has an aid foundation that helps their servicemembers through tough times. Here is a top-level list:

In most cases, these foundations will offer interest free, or low-interest loans to help you bridge the gap. Some may also offer a small cash grant or other aid.

Work with Your Creditors. If your paycheck problems cause you to run low on cash, you need to get proactive. That means contacting your lenders and creditors. Explain the situation and ask if they will be willing to work with you. Some lenders may be willing to let you skip a payment, or may be willing to waive late charges or finance fees for your first missed payment. The key is keeping lines of communication open. They can’t and won’t work with you if they don’t know about the situation.

Military Banking is a great way to go. Many military banking institutions will work with you on things like credit card payments, auto loans, etc. if you get them on the phone and let them know what is happening. Some of them also offer temporary loans that can help you bridge the gap. NFCU, PenFed, USAA, and other military banks are often willing to work with servicemembers in situations such as these.

Get More with a Free USAA Secure Checking Account

Raise Cash. There are many ways to raise cash quickly, so you’ll need to be creative. This can include things such as selling items on Craigslist or Ebay, having a yard sale, taking on a part time job, doing a side job for cash, etc. Your situation will be unique, so go with what you know and what you can do.

Credit Cards May Be an Option. Another option, though less attractive, is using credit cards. I don’t normally recommend using credit cards to pay for normal living expenses, but it’s a different story when it is for an emergency. And credit cards are almost always a better option than taking out a short term loan from a pay day lender, title loan company, or other company that offers high-interest short term loans. If at all possible, try to pay off your credit card as soon as possible. Here are some featured military credit cards.

Tap into Your Home Equity Line of Credit. I don’t like this option very much, because you would be taking out a loan against your home to pay for living expenses. The only time this is a good option is if you know you can (and will) repay the loan quickly. Otherwise, it’s better to look at other options.

Payday Loans and Title Loans – The Worst Options. Perhaps the worst thing you can do is get a  pay day loan, title loan, or other high interest loan. They are a quick way to digging a deeper hole and can be difficult to get out of. Interest rates on those loans don’t appear to be too bad at first-glance, but they are usually represented as a percentage for the short-term duration of the loan. So what appears to be a 20% loan is actually a 20% interest rate for a week or two. But it can be over 300% for a full year! To put that in perspective, you might borrow $1,000 and repay over $3,000. There are better options available!

Plan for the future. Once this situation is resolved, it’s a good idea to plan for something like this possibly happening again. It would be a good idea to use the separation pay and bonus to get current on any missed bills, and then save a little in an emergency fund for a rainy day. This will help you and your family avoid any potential financial surprises.