BLUF: If you are hating life while trying to be financially responsible, you are doing it wrong.
Not a military member? Stick around. These words apply to any job.
This is a pure opinion piece. The views expressed within do not represent the views of the United States Government, the Department of Defense, or the U.S. Air Force. It’s just my opinion/rant based on seeing people make important decisions with too much emphasis (IMO) on the money.
Last night, I was working on a post about the TSP when I checked into my Facebook groups. I found a post about a couple who were turning down an assignment to Aviano AFB because taking an assignment at Little Rock was the financially better decision. An actual quote: “Being financially responsible can really suck bumpy pickles sometimes, if we’re honest.” That’s quite a line.
Earlier in the day, there was some back and forth in a different forum over the Blended Retirement System. Very long story short, somebody was choosing to stay with the legacy pension system instead of switching to BRS because when they ran the numbers (using a conservative projected annualized rate of return on TSP investments) the total compensation from BRS was approximately $60,000 less than the legacy system. The servicemember in question has 6 years time in service; 14 years to go, if they make it. They are locking themselves into a career for 14 years for maybe $60,000 (I think it’s actually less than that).
In May, The Military Guide featured a guest post from Justin Taylor at Saving Sherpa about increasing your effective income by actively seeking assignments in high BAH areas. Now, if you’ve been following me for awhile (especially on social media) you should know I respect the hell out of Doug Nordman. And I don’t know much about Justin, but I’ve liked what I’ve seen so far. Except that I hate this post. Hate it. The post was all about focusing on BAH when choosing assignments – nothing else.
There is more to life than money
Military life is tough. Everybody, from the highest ranking general to the brand new slick sleeve, has responsibility and authority not seen in equivalent positions in the civilian world. That’s right. If you think you are being treated like a child in the military, ask your high school buddies how many decisions they can make in their job. I bet your level of responsibility is higher. But we have that responsibility because we have a sacred mission the American people have entrusted us to carry out even when it sucks bumpy pickles (I’ll stop using that now).
Personal finances are tough, too. Americans are not taught how to deal with money. In fact, we actively discourage people from discussing money, which only exacerbates the problem. You might have guessed that I don’t like that, and that I want to change it. That’s why this blog exists, after all – to help make military members a little bit smarter about their money.
Part of that means helping people figure out how to do the math. For instance, whether it’s financially better for a particular person to invest in a Traditional or Roth retirement account. Or whether the BRS will provide more money in the long run than the legacy pension.
But I hope – I hope – you readers are getting more out of this blog than just the numbers. Personal finance is personal and you need to approach it that way. That means looking beyond the numbers.
So here is my rant.
STOP MAKING MILITARY CAREER DECISIONS BASED SOLELY ON THE MONEY
That amazing, once-in-a-lifetime assignment opportunity will cost a little more than staying in your current location that you hate? Spend the money! Money is a tool to help you live the life you want. Unless that new location will crush your financial future (highly unlikely, but possible in theory), go for the assignment and location you want. Especially now, when the military is paying for it!
You want to make a decision on which pension system to choose? Don’t just look at which one might give you more money. Look at which one aligns with the life you think you want to live…and which one aligns with the military career you will actually have. The legacy pension is amazing – there is no doubt about that. But BRS has something the legacy system doesn’t, which is flexibility. Would I give up $60,000 over my lifetime to greatly increase my career flexibility? You’d better believe it.
You want to move to a higher cost of living area so you can bank some extra BAH? Guess what? If you hate the job and area, you are going to spend that extra money on activities and travel to distract you. At my last duty station, I hated the area so much that I drove to the next state at least twice a month just to get away. That wasn’t cheap. Or maybe you decide to hunker down to save money, and you spend 3-4 years absolutely miserable. Neither one of those is a good thing. I didn’t choose that location, and I wouldn’t choose it again, no matter how much money I could save.
For that matter, I sincerely hope nobody is serving past their first assignment just for the money. Getting into the military to get out of a dead end life or to pay for college is maybe – maybe – acceptable. But once you are past your initial commitment, you have skills that can carry you through in the civilian world. You don’t need to stay in the military to make it financially. So I sincerely hope you are in this all-volunteer force for reasons beyond the paycheck. Military life is way too difficult to do for a middle class income and nothing else.
I’ve deployed three times to combat zone tax exclusion areas aka the Middle East. The first time was basically a requirement based on the unit I went to (which I requested to join) and the other two were straight up voluntary. I know some people think I volunteered for those assignments at least in part for the money, if not entirely so. And I’m not going to lie, combat zone money is nice. But it’s a nice bonus. It’s not the reason I deployed. I chose those assignments because I wanted to do the job.
You wouldn’t choose to walk into a firefight because you’d get $1,000 if you came out on the other side, would you? Of course not. So volunteering to deploy needs to be based on more than the money. The same thought applies to the rest of your military career, too.
We have it tough enough as it is in the military. There is no reason to make it harder on ourselves just to make our financial situations a little bit better. Take an assignment or don’t because you want to do the work, not because you can put a little more money in your pocket.
It’s not like you are deciding between working at your parent’s grocery store in Poughkeepsie and becoming a senior executive at Google in California. Military pay and allowances are controlled. You aren’t going to become a millionaire just because you choose certain assignments over others. It may bring you slightly closer to your financial goals, but there is way more to personal finance than that.
There is no job in the military that is worth doing purely for the money. Do it for your country, or your family, or your sense of pride, or because you really like MREs. Whatever. But not for the freaking money. It may be enough money, but it’s not that much money.
Will there be times when you need to make a decision based on the money? Yes, absolutely. Buying the $4,000 80” 4K UHD TV when you only have $1,000 to spend is a good time to be thinking about the money. Deciding whether you are ready to retire is a good time to be thinking about the money.
Heck, I’m not even saying the money can’t be a factor in making military career decisions. But it definitely should not be the primary factor. Your life is going to be hard enough. You don’t need to make it harder by self-inflicting pain. The military pays us enough to live a comfortable middle class lifestyle – or better if you reach the higher officer ranks. That’s good enough.
I have in the past, and will in the future, talk about the monetary benefits of a military career. But I want to be very clear that the monetary benefits are not the overriding factor. Your military career can, and should, be based on much more. I sincerely hope you feel the same way.