One weekend a month and two weeks in the summer. That doesn’t capture the true experience of serving in the Guard or reserves since 9/11. However, it has some definite financial incentives. Here are six:
- Reserve retirement. Generally, you must wait until age 60 for the retirement checks to start, but reserve retirement can provide a powerful boost to your financial security. For example, with six years of active duty and 14 years in the Guard or reserves, a retired E-7 who turned 60 this year would receive a monthly retirement check of roughly $1,200. It’s like having an additional $250,000 of retirement nest egg!
- Health care, part I. Continuing to serve can open your eligibility for TRICARE Reserve Select (TRS). This premium-based health-care option is available to members of the active Guard and reserves, and it’s a fantastic deal. In 2018, you can get coverage for your entire family for $221 per month and individual coverage is less than $50 per month. You won’t find that type of value in the civilian sector.
- Health care, part 2. If you’re still working at 60, it might offer you an opportunity to save big money by opting out of your civilian employer’s health coverage. If not, rest easy knowing that even without having reached Medicare age you have very affordable and comprehensive coverage. And once you sign up for Medicare, you’ll switch to TRICARE for Life and won’t need Medicare Supplement Insurance.
- Life insurance. As a drilling member of the reserve component, you’ll continue to be eligible for $400,000 of Servicemembers’ Group Life Insurance coverage.
- Additional income. Continuing to serve also affords you the opportunity to earn monthly drill pay along with active-duty pay for annual training. This “extra” income can be used to save, invest or pay down debt.
- Access to installation services. You’ll still have an ID card that will allow you to tap into a nearby installation’s PX/BX, commissary, MWR and other money-saving services.
J.J. Montanaro is a certified financial planner with USAA, The American Legion’s preferred provider of financial services. Submit questions for him online.