5 GI Bill Facts Every Veteran Needs to Know

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The GI Bill is one of the most valuable benefits Veterans are eligible to receive. These facts will help you understand how to use this benefit to your advantage.

The GI Bill is one of the most valuable benefits that most veterans are able to take with them when they leave military service and transition into civilian life. The value of a college education vs. not having a college education can be well over a million dollars throughout the course of a lifetime. Using military education benefits to pay for your education, or reduce the number of student loans you need to pay your tuition can make your investment a lot more valuable.

If you are eligible for the GI Bill, here are some things you need to know:

You May Have a Limited Amount of Time to Use GI Bill Benefits

The day after you separate from the US Armed services, the clock starts. From that day, you may have a limited amount of time to youse your GI Bill benefits. In some cases, you may lose those benefits forever. Here are the term limits:

If you fail to use your GI Bill within the allotted amount of time, you lose those benefits forever. There are a few exceptions to this rule, most notably if you rejoin Active Duty status. If you rejoin AD service for more than 90 days at any time during the 10- year or 15-year period, your clock is reset. This most often comes into play when veterans transfer into the Guard or Reserves and are activated for more than 90 days. At that point, your GI Bill is reset to 10 or 15 years, even if you only had a few months remaining. Sweet deal!

Remember – unless you have the Forever GI Bill, it’s use it or lose it!

The GI Bill is Not Considered Federal Student Aid

The Montgomery GI Bill is intended to be used for tuition and college expenses, but it is paid directly to the student, not the school. Because of this, the Montgomery GI Bill is not considered Federal Student Aid in the traditional sense. Many college and university financial aid departments may require you to sign an agreement to use your GI Bill funds for tuition costs, or require you to apply for student loans to pay tuition and fees in advance. What you do with your GI Bill payments is actually up to you. Hopefully, you will use it to pay your tuition and fees.

There are benefits to the Montgomery GI Bill not being considered Federal Student Aid. In addition to receiving the GI Bill, you may be eligible for student loans, scholarships, Pell Grants, employer tuition assistance, and other grants or student financial aid.

The Post-9/11 GI Bill is paid directly to the school, however, students may be eligible to receive a Military Housing Allowance, book stipend, or other direct payments. Again, these payments are not considered Student Aid.

A “Term” is a Month, but That Doesn’t Always Mean a Month

The GI Bill provides 36 months of education benefits. This can be measured in two different manners. For veterans, this means receiving 36 months at the maximum payment rate (currently $1,101 per month). To calculate the number of months when receiving your entitlement, divide the total amount you receive by the monthly payment rate. For example, if you receive a check from the VA for $5,505 and divide it by the max rate of $1,101, you will be charged for 5 months’ time against your GI Bill benefits.

GI Bill terms are calculated slightly differently for those on Active Duty. If you use your MGIB while on AD and you go to school full-time, you will be charged the number of months you attended school, regardless of how much the tuition cost. In this example, a “month” actually does mean a month. The best way to use your GI Bill on AD is to use your service’s tuition assistance program and use your GI Bill as tuition assistance “top-up” if your tuition costs exceed your tuition assistance level.

GI Bill Rates Are Based on the Number of Credits You Take

Montgomery GI Bill payment rates are prorated based on the number of credits you take. Full-time students receive up to $2,122 a month (FY ’21 rates), and rates are prorated downward from there. Payments can be broken down into full-time, ¾ time, ½ time, etc. A full rate schedule can be found on our MGIB rate page.

It is important to recognize that if you do not receive full-time MGIB payments, you will not be charged a full month of credits against your MGIB eligibility. As noted above, your GI Bill credits will be charged based on the total payments received, divided by the full-time rates. So if you only take half time courses, you will only be charged half a month from your GI Bill eligibility.

You Do Not Have to Use the GI Bill All at Once

You have a 10-year, 15-year, or unlimited window of opportunity to use the Gi Bill. The GI Bill has 36 months of eligibility, but that does not mean you are required to use it all at once. In fact, you can start and stop your MGIB benefits as often as you wish, provided you do not exceed the 36 months of eligibility.

For more information

Be sure to visit the VA’s GI Bill page, or contact your local VA office. Whatever you do, don’t pay someone to help you get the GI Bill information you need. It is all out there and available free of charge!

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About Ryan Guina

Ryan Guina is the founder and editor of The Military Wallet. He is a writer, small business owner, and entrepreneur. He served over 6 years on active duty in the USAF and is a current member of the IL Air National Guard.

Ryan started The Military Wallet in 2007 after separating from active duty military service and has been writing about financial, small business, and military benefits topics since then. He also writes about personal finance and investing at Cash Money Life.

Ryan uses Personal Capital to track and manage his finances. Personal Capital is a free software program that allows him to track his net worth, balance his investment portfolio, track his income and expenses, and much more. You can open a free Personal Capital account here.

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  1. Elliot says

    When I enlisted in the army national guard with a college degree, I had originally planned to use the TA to get a vocational certification but later found out that TA cannot be used to get a lateral degree. I don’t know if that applies to vocational certificates, but it probably does. I couldn’t go in as an officer either because one of my parents was a foreign citizen, disqualifying me from a security clearance.

    It didn’t matter by that point, because I was already given a 5-11 discharge and a reentry code of 3, which is a permanent ban from military service unless I get a waiver.

    It’s honestly not even worth it, looking back. The mountainous volume of paperwork involved in enlisting and getting discharged from the army is enough to scare me from ever working a government job. It’s terrifying to think what would happen if those sensitive documents got lost, which probably happens more often than we think.

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