A popular phrase common amongst military members is “you can’t get rich in the military.” Having spent 28 years in the Marine Corps and Air Force, I have watched scores of Marines and Airman blow their money on extravagances and not plan for their future.
When a military member enlists, they typically will pay $100 a month for 12 months to qualify for the Montgomery GI Bill. Imagine if at the end of that first year, the military member continued to save that one hundred bucks placing it in a conservative mutual fund.
During the first 4 years in the military, for the person that enters as an E-1 they will receive 11 pay raises over the course of that enlistment. What if that person saved half of each of those pay raises and stayed in the military for 20 – 30 years? How much would that add up to at the end of a career?
I maintain that a person who does that will be able to possibly retire at the end of their military career. They would not necessarily have to enter the workplace to start a second career. Instead, they could find a part time job or accept a position with a non-profit organization and actually have a low stress fun time in their post military employment.
While it may seem an impossible feat, picture the following scenario. An Airman starts off making approximately $1200 a month. If each year he averages $300 a month of pay raises and then takes half of that pay raise and puts it in savings after 20 years he would have $342,000 not including any interest or dividends. A military officer could easily double the scenario and have nearly $700,000 saved at the end of his career.
Imagine being 38 years (or 42 for an officer who went to college) old and paying cash for a house. If your retirement is $4000 a month, you could actually not work if you didn’t have a house payment. Instead of starting another stress filled career, you could do volunteer work at your church. Or you might consider a job driving a golf cart around serving beverages to those on the links.
During those years, it will be very tempting to dip into that expanding sum of money for trips, new cars and new gadgetry. But, to the military member with the self control to stay the course, the post military life will be one with far less stress than those that don’t save for the future. Simply put, given the right motivation, consistency and self-discipline you can grow rich in the military.