You’ve Served, Now It’s Time to Be Served: Top 8 Veteran Benefits
This Monday we observe Veterans Day. For some, this may be a day off work or school, or an opportunity to sell or buy discounted furniture. However, we should also take a pause and remember the real reason we observe this day. Originally deemed Armistice Day to honor Veterans of World War I, it was after World War II and the Korean War, that Congress decided to amend Armistice Day to Veterans Day to honor all American veterans who have served.
Our men and women in uniform have done a great service for our country, and so it is only fitting that as we thank them for their time, sacrifice, and strength. It is also equally important in some small part to allow us to now serve them. In that spirit, I’ve compiled some of the best resources for Veterans and active duty; both quick freebies and discounts, to longer-term benefits that every service member should look into.
For those Servicemembers on your special day…
MilitaryBenefits.info has compiled a fantastic compilation of benefits and programs for Veterans Day 2019:
Your service comes with more perks than just a free milkshake…
While freebies and discounts are well appreciated, being a veteran or active service member also provides you with valuable, but unfortunately often underutilized benefits. Here are the Top 8 Benefits that every Servicemember should know:
- GI Bill – This bill provides benefits towards Four Year Universities, Community Colleges, and Advanced Degree Programs. As part of this program, you may have all or a significant portion of your tuition covered as well as a housing allowance. There are numerous resources out there to get you started, and while there are a variety of versions of the GI Bill such as the Post-9/11 GI Bill, Montgomery GI Bill Active Duty/Selected Reserve, as well as Survivors’ and dependents assistance, this handy tool can help you learn more about your eligibility. Lastly, it is important to note that there is normally a time window in which you can use these benefits. For those using the Post-9/11 GI Bill, you usually have 15 years after separating from service, and for those using the Montgomery GI Bill, you usually have 10 years.
- TRICARE – Active Duty, National Guard, and Reserve Service members and their families have access to healthcare through TRICARE (in addition to retirees, survivors, certain former spouses, Medal of Honor recipient and their families, and others registered in DEERS). For those separating from service (not retired), you typically have 90 days to change to another health plan depending on eligibility. TRICARE also provides both a Transitional Assistance Management Program (TAMP) that can (if eligible) allow another 180 days of premium-free health care, as well as a Continued Health Care Benefit Program (CHCBP) which can provide 18 to 36 month after TRICARE or TAMP coverage ends. Under normal TRICARE coverage, members receive preventative care, mental health care, vision, pharmacy benefits, dental, as well as other special programs.
- Disability Payments – Servicemembers are eligible for disability compensation for any disease or injury incurred or aggravated during active military service. They may also qualify for compensation to be paid after leaving active service if any diseases or disabilities are presumed to be related to that military service, even if they arise well after leaving active duty. The VA also provides Vocational Rehab and Employment (VR&E) for those eligible veterans and active duty service members who have a limited ability to work. There is no premium to be paid, and the benefit is received tax-free. The amount received is based on their Total Combined Military Disability Rating, ranked 0 – 100%, and each rating receives a different amount of payment.
- Life Insurance – Servicemembers have access to group life insurance, and are automatically covered for the maximum of $400,000 in death benefit. While premiums are paid for from payroll deduction, they are greatly reduced compared to purchasing a private policy. When you leave the military, you also have the ability to convert these policies over to a renewable five-year term life policy, which can be a great option for those transitioning into civilian life.
- Retirement Benefits – In recent years there have been many new changes to the current military retirement system and so it is important to note that there are other programs outside of the currently defined retirement system. Under the current retirement system members are paid under one of three benefit programs based on when they entered service. These models all essentially pay out on a formula based on final pay and the number of years of active duty. Beginning in 2018, in an effort to better provide for members who do not stay in the standard 20-years to be eligible, the military introduced a new Blended Retirement System (BRS). This new system combines defined benefits, defined contributions to the Thrift Savings Plan (TSP), and/or Continuation Pay for members who have more than 12 years of active duty. Enrollment in either program depends on when you entered service.
- Long-Term Care – Retirement and long-term care benefits can serve similar purposes, however, there are reasons to distinguish the two benefits from one another. Outside of the traditional military retirement system, there are also three levels of VA Pensions: Basic Pension/Improved Income, Aid & Attendance (A&A), and Housebound available to certain members of the military community. Basic Pension/Improved Income is a benefit that helps support healthy veterans with lower incomes. A&A benefits are provided to veterans age 65 and over that required assistance with the Activities of Daily Living (ADL)s. And finally, Housebound is a benefit for veterans who have a disability rating of 100% that prevents them from leaving their home but not necessarily because of their military service.
- Free Tax Preparation – Servicemembers and their families may access free tax preparation services on military bases as well as around the country where Volunteer Income Tax Assistance (VITA) offices are available. Also by working with those on base, you will have access to an expert who is familiar with the oftentimes complicated nature of military-specific tax concerns.
- VA Home Loans – For Servicemembers, Veterans, and eligible surviving spouses, the VA provides a home loan guaranty benefit as well as other housing programs to help in the buying, building, or repair process. Through this program, eligible members can: purchase a home with no down payment (in most cases), pay no private mortgage insurance premiums (PMI), reduce closing costs (the VA rules limit the amount you can be charged), avoid potential penalties if you pay off the loan early, and finally the VA also can provide some assistance if you run into difficulty making payments. Buying a home is a big commitment, but the VA is dedicated to making this process easier for Servicemembers.
Thank you again to all of those who have served, or are currently serving. From both myself and on behalf of My Financial Coach, we cannot begin to appreciate the personal sacrifices that you have made nor the extraordinary discipline and resilience you have shown in the face of adversity.
Happy Veterans Day!
Andrew J. Crosby, CFP®, ChFc®, RICP®
Lead Financial Coach