Do we as leaders take enough time to mentor our junior enlisted on investing for retirement early enough?

SFC Private RallyPoint Member — Sun, 24 Nov 2013 08:33:49 -0500

As leaders/mentors do you think it is our responsibility to educate our lower enlisted on planing for the future financially? Who set you on your path for financial stability? What was the best advice you received on planning for the future? Do you think the DoD has a responsibility to educate us on financial planning? Or if you haven't started what is holding you back?

Early in my career, just like almost everyone else, I didn't think about what life would be like when I either got our or retired. I lived from pay check to pay check wasting money on "stupid things," one day I was talking with a SFC that was about to get out and he opened my eyes to what investing early in my career would look like when I was in his shoes. Many years later I am glad I took his advice and wish I would have taken the advice of other NCOs that told me at each promotion to set aside a small percentage of it prior to ever seeing it in my pay check. It has been my experience that younger Soldiers do not look forward enough and see or understand the second and third order effects of not having a sound budget or financial plan.

Response by SFC James Baber made Nov 24 at 2013 4:25 PM

SFC James Baber — Sun, 24 Nov 2013 16:25:30 -0500

I can address part of this I was a CFNCO (Command Finance NCO for those not in the know) for 3 years and that was part of my job. I did initial Soldier briefings at my BN, but most of the Soldiers that came were just there to check the block, the only time I ever really saw a Soldier was when they were in trouble (i.e. pending Art 15, needing AER loan, etc.). But I did coordinate through ACS to start a program at the time for all CFNCOs to give daily briefings for the installation of newly in processing Soldiers regardless of rank, we did one for junior Soldiers, NCOs, and Officers, and I helped implement it as more than just checking the block for in processing, I had a small quiz added to the briefing before their sheets could be signed, and for the ones that blew off the briefing, their sheets had to be signed off by their BDE CDR to be able to be fully in processed, I had the CGs blessings for that one. That was in 2002, not sure how many installations are still if at all doing it, because I was in III Corps assignment at the time, it was passed on to all III Corps installations and enforced, it was recommended to other installations and DA, but not sure how far it went. The point is that at one time even during the beginning years of OEF and OIF it was an issue that was being addressed, but not sure how much of a concern it still is today.

Response by CPT Private RallyPoint Member made Nov 25 at 2013 8:16 AM

CPT Private RallyPoint Member — Mon, 25 Nov 2013 08:16:57 -0500

Simply put, NO.

Response by SSG Private RallyPoint Member made Nov 25 at 2013 8:40 AM

SSG Private RallyPoint Member — Mon, 25 Nov 2013 08:40:14 -0500

It is part of our responsibility as leaders to educate our Soldiers on the importance of fiscal responsibility and what Soldiers must do to avoid living paycheck to paycheck. We know it isn't being done enough because a grown man or woman doesn't want their boss to be in their "business".

The only time it becomes an important or prevalent issue is when the Soldier comes to the Supervisor asking for an AER loan or a grant because they've racked up so much debt that it'll take years to pay off. Financial management classes are part of some in-processing processes but Soldiers don't take it seriously enough because they know they're getting paid once/twice a month (dependent on which option they chose) and they feel that they'll be alright.

Response by CPT Daniel Walk, M.B.A. made Nov 25 at 2013 9:34 AM

CPT Daniel Walk, M.B.A. — Mon, 25 Nov 2013 09:34:51 -0500

Probably not, but if you go through every regulation and attempt to accomplish all the mandatory training dictated by 350-1 and the monstrous amounts of MILPERs and ALARACTs, there is very little time for spoonfeeding adults the information their parents should have given them.

At some point, SNCOs and Officers must accept that Soldiers must assume responsibility for themselves in such areas. They receive an insane number of briefings during IET. If they haven't figured it out by then, you cannot demand that supervisors be held responsible for every little thing.

Response by SSG Private RallyPoint Member made Nov 26 at 2013 1:50 PM

SSG Private RallyPoint Member — Tue, 26 Nov 2013 13:50:26 -0500

As a professional in the financial field, I took the initiative to offer my knowledge to the soldiers in my unit.  I understand that are other priorities in the unit to be done in drills and leadership has no time for this. I am not in a leadership position (for now), but it is so gratifying that my buddies can count on me.  In my opinion, leaders can take advantage of soldiers like me.  Reserve units have a lot of professionals, and leaders should take advantage of their resources.  Maybe they do not have the time, but there are others that are willing to help them.

Response by CPT Brian Willey made Nov 26 at 2013 2:10 PM

CPT Brian Willey — Tue, 26 Nov 2013 14:10:14 -0500

Many Army posts have had Financial Peace University for Military offered through ACS, and we have conducted 3 of those courses during this deployment to help those looking to better themselves and their situation. About 30 people took advantage of their downtime and got the information.

Not every unit has someone like SPC Santiago who is willing to help and that others know they approach with questions. On the other hand, some people are very private about their finances and the very thought of asking questions or sharing is very uncomfortable.

As CPT Walk said, it should start before the SM ever leaves home; but it is never too late to learn and take control of your (financial) life. But it has been a fine line to walk offering and encouraging help and information without being pushy or risking what may be deemed as "undue influence."

Response by CW2 Joseph Evans made Nov 26 at 2013 3:01 PM

CW2 Joseph Evans — Tue, 26 Nov 2013 15:01:22 -0500

I think we have a hard enough time providing financial counselling that will get them through the next month. Having them succeed at getting a 3 months savings built up in the event of an emergency is nearly impossible, and we worry about what a first term Soldier is setting aside for his "retirement"?

I think we need to step back and actually realize that even though his annualized BAH and BA represents working for somewhere between $11 and $19 an hour (an incredible sum in today's labor market), unless they are single, living in the barracks, eating at the DFAC, and don't own a car, they probably do not have a lot to spare.

Response by SFC Private RallyPoint Member made Nov 26 at 2013 6:46 PM

SFC Private RallyPoint Member — Tue, 26 Nov 2013 18:46:17 -0500

Not at all. I am a pretty good example of that, as I didn't start to seriously look in to retirement planning until I hit 10 years, which was just last year. Yes, we had briefings in IET, but when you're a young PVT in training you're not paying attention to that stuff. And we usually don't start to question our Soldiers about finances until they're in trouble for something. We wait until their security clearance is in jeopardy or we're counseling them for using their government credit card or something crazy. Around 2 years ago I started incorporating financial questions in to their quarterly counseling. I also, during our meetings, will bring up financial topics to hold a group discussion so we can get advice from each other. Also, since I just started looking in to investment options last year, I still haven't settled on a decision, so any advice is appreciated!

Response by SFC Private RallyPoint Member made Nov 26 at 2013 6:46 PM

SFC Private RallyPoint Member — Tue, 26 Nov 2013 18:46:22 -0500

Response by 1SG Glenn Aldrich made Nov 27 at 2013 1:24 AM

1SG Glenn Aldrich — Wed, 27 Nov 2013 01:24:06 -0500

I took an active role in guiding my platoon sergeants, squad and team leaders to get in the weeds of a soldier's entire life, not just financial. When a soldier was first assigned to my company he was in front of my desk within 24 hours. If possible, I had them bring their wives, that way she coild hear it to. I discussed finances as a part of that discussion, especially the fact that every business outside of the post was designed to seperate Joe from his money. Major purchases were encouraged to be cleared through the PSG. Not for approval, but a common sense check. This gave keaders a heads up before problems started and a sense of trust with the soldiers because their leaders cared. Think about it from a 1SG point of view, the more soldiers I have in training, the better we do in war. Also, when a soldier has financial problems, to get them rectified requires an NCO escort. Now I have two out of training. Can you see the snowball effect?

For the young officers commenting on this, I was an OSUT Drill Sergeant and we did give them all sorts of briefings. The soldiers were more concerned with staying awake so we would not smoke them than absorbing any information, especially if it wasn't testable. How many times do you receive a call in your officefrom a bill collector? If you do, does it disrupt your day? As a 1SG, it would disrupt mine. Without prompt response from the CoC, the bill collector can and will call Bn. The military are the only employers where bill collectors can call that soldier's boss and we have to do something about it. If you don't believe me, blow one of them off and wait for the CSM's call.

Don't look at this as adding more time to an already crowded training schedule. Look at it in regards to taking care of the soldier. The military is not like corporate America where folks are expected to be adults. Here people follow orders, or people die. That doesn't happen in the "real world". If you want your soldiers to trust you, ensure that their needs are met and they will break their backs for you. Leave it until it is time to counsel them for indebtness and you lost an opportunity for him or her to drink your koolaide.

Having seen first hand what the parents of America are doing for their children based on the soldiers that I received, hang it up on trying to say that Mommie and Daddy should have provided that period of instruction. Soldiers did not know how to properly care for themselves physically, let alone financially. Take some ownership no matter where they came from, treat them as part of your family, and get them ready for combat. Having to bring a soldiet out of the field, back from NTC or deployment for an avoidable family issue should reflect on that NCOER or OER, my opinion. Take care of it before you get to that point. Treat it like BRM, there are different periods to facilitate the training. Start slow, then ramp it up. Many of the examples and ideas that have been presented in this forum are valid, but it starts with the first line and must be supported by the Company level leadership. You are not doing it for them but for yourself by keeping them gainfully employed at work rather than them and their NCO running all over post during the duty day trying to fix something.

On the subject of AER. I had my commander delegate the responsibility for approving ARE loans to me, the 1SG. I established a program where the PSG had to prove that there was no other way to help the soldier without AER. This put the onus on the PSG and his subordinate leaders to dig into Joe's life. I would treat it like promotion debates where the PSG would have to justify his soldier's worth to the organization. This wasn't because I wouldn't sign it, but to engage the leadership. It was not a rubber stamp action, it had to be fought for, so the PSG had to invest time and effort.

When thinking of leaders, ask yourself, "would I let this person lead my children into battle?" It really changes the way you look at situations. These are someone's child not just a group of names and socials. They should be adults, but don't forget where you came from as well. We were all stupid and broke at one point, and so shall they be. You either figured it out for yourself, after some missteps, or someone helped you. I'd rather help the soldier not to make the same mistakes that I made rather than using the deep end if the pool analogy.

Response by CW4 Terry Zimmerman made Nov 28 at 2013 12:27 AM

CW4 Terry Zimmerman — Thu, 28 Nov 2013 00:27:35 -0500

I was fortunate enough to have my parents instill great values, which included being able to save for that "rainy day". I started well before my time in the army began and kept it up throughout my entire army career. I was advised by my father that 10% of every paycheck was to go into a saving account and not be used for anything until I really needed it. Which turns out, if you try, would be never! I first started investing in a traditional IRA and then rolled it other into a Roth IRA when given the chance. I also did my own online investing and started buying Walmart stock back when you had to do it over the phone. I bout at least three shares of Walmart every month and increased it as my rank increased. This little plan helped my wife and I to buy our current farm out right and have no payments. I also started a ROTH IRA for my wife and as her employer can also contribute to a 401K for her under our farm plan. I then placed it on auto pilot and used a DRIP plan and only recently cut it off as I am where I want to be with my stock portfolio. I thank my parents and several other friends for mentoring me in the ways to take advantage of the investment system out democracy has allowed us to enjoy. To bad 51% of this country feels like they are owed what I have made over the past 30 years. NOT GOING TO HAPPEN!!

Good luck to all those soldiers that feel like they should have things given to them and not have to work at it all. I guess they are all supposed to be driving BMW's and Huge SUV's and screw investing in a 529 for their children's education or for some reason thinking that the new GI Bill is going to send them to school in the future. Again, I have always tried to help any soldier out that wanted help and a lot of them have taken advantage of the help I offered and to this day I can tell they are happy as I get several Christmas cards each year thanking me for the classes I taught and the help I gave them. They will be the few that are happy in the future.

Just remember the saying that 99% of all marital problems are centered around money and the other 1% can be solved with money! Plus, people say that many can't buy you happiness.....I find that to be coming from someone who has their hand out most of the time!!!

Response by SGT(P) Dennis Giles made Nov 28 at 2013 7:42 AM

SGT(P) Dennis Giles — Thu, 28 Nov 2013 07:42:33 -0500

I don’t believe soldiers ever receive enough financial
counseling. Additionally, soldiers with financial security will have higher
morale and better job performance. During my time as a lower enlisted I
struggled with this day-to-day. I went through AER counseling for help but that
wasn't enough. Most of the advice I received was to plug a wound and never any
real actionable plans on how to recover or grow. <o:p></o:p>

<o:p> </o:p>

SFC Baber (above) makes a good point: you can’t look at a
soldiers finances unless they are asking for help. What you can do is hold
financial briefings for your soldiers and provide them with best practices, make
sure they are aware of the resources at their disposal (AER, etc.), and are
introduced to the outside financial growth options (bonds, funds, etc.). Of
course, you have to be careful not to recommend specifics (like buy this stock)
because if investments fail you become partially liable for any loss. My unit
at LRMC had a mandatory financial briefing for the entire unit every year. The briefing
covered many of the items above and got our soldiers thinking ahead. <o:p></o:p>

<o:p> </o:p>

Since my early days in the Army I have been able to make
huge changes in my life due to proper long and short-term financial planning. I
also know have a Masters in Global Business and spent quite a bit of time
dealing with accounting. Here are the basics I would make sure every soldier
knows: <o:p></o:p>

<o:p> </o:p>

1.      
Create & Follow a Budget: Setup a monthly
budget. Fist determine your living expenses and debt repayments. Next figure a reasonable
amount to pay yourself; this is your monthly stipend to pay yourself. Use it to
live a little and it will help keep a young soldier on track. At the same time,
realize that you must live within your means. Being soldiers, everyone knows
where they basically fall financially. As a leader, create an environment of
understanding within your unit and be aware of creating any undue pressure on
soldiers of lower rank/pay (TDY costs, unit fund raising, etc.).  Map your budget out over the next 12-24 months;
get a picture on where you are now and where you could be in 1-2 years if you
stick to it. Even if it takes a year or more, make a goal to keep a balance on
your cash account that can cover your budget costs for 3 months and then a
year. This will provide a substantial emergency umbrella for your life and
guarantee you will feel a huge weight lifted from your shoulders when that goal
is achieved.<o:p></o:p> 

2.      
Stop bleeding money: pay down your debts
starting with the highest interest accounts first. It doesn't do much good to
try and save when most savings and investments will not make money faster than
debt interest will bleed it away. Contact your AER rep for assistance in
getting those accounts under control (lower interest rates, lower monthly
payments, consolidate, etc.). This is a very important step and most people do
not realize the help financial consultants can provide in dealing with credit
card companies and banks in lowering interest rates and obtaining grace periods
for repayments. <o:p></o:p> 

3.      
Build your savings: Once debt is under control
and a repayment plan is in place it is time to plan for growth. Start small and
build up as debt decreases. The most helpful tool is to find your best investment
options for annual rates of return and then build yourself a 20 year matrix on
what that will look like with regular increases to the fund and compounded
interest; be realistic. Seeing this number and watching it actually grow is
what will keep anyone on track. I love looking at my new balance every month. The
ultimate goal is to obtain reasonably secure dividend bearing investments that
can act as a secondary retirement fund or source of passive income. <o:p></o:p> 

4.      
Time: This is a difficult factor for young soldiers.
Money will not come pouring in overnight but if you establish your short-term
budget and long-term investment plans the time will not seem so vast. After watching
your monthly budget for the first 6 months you will see how fast time can
really fly by. Make additional goals for yourself and get the gratification for
the small wins in seeing your checking account balance grow each month. Also realize
that the grass is not greener on the other side. The Army may not provide hard
paychecks on par with your civilian counterpart but it does pay off. Civilians
still have many other costs (like medical, housing, etc.) that eat away at that
gap. Also there is your retirement to consider. Civilians must rely solely on
their investments (pensions are thing of history). Federal civilian jobs are
moving toward 401K/Mutual fund retirement plans. The military is basically the
last place you can obtain a real retirement/pension; this is your greatest financial
benefit. <o:p></o:p>

Response by SGT Private RallyPoint Member made Dec 1 at 2013 11:59 PM

SGT Private RallyPoint Member — Sun, 01 Dec 2013 23:59:43 -0500

Ever since my days in AIT, I have been an advocate to my fellow Soldiers for thrifty spending and saving for the future. It absolutely BAFFLED me to see an E-1 who's biggest concerns about financing a big-screen TV were how to get it back to his barracks room without a car, and whether it would fit in his wall-locker...

Unfortunately, as some have mentioned, the financial training we all received in Basic was drudgery, and amounted to an(other) exercise in trying to stay awake.

The truth is that Financial education in a group setting will only get you so far. Individual attention from a first-line supervisor (or even cross-line peer) is really needed, and even that can be really difficult for many to accept.

The young Soldier doesn't want to hear "You can't really afford that PS4 right now, why don't you keep playing your PS3, and save that money so you can get a PS5." They want it, NOW.

I am living proof that saving and living debt-free really pays off. True, I don't drive a fancy car (yet) or have the sweetest home theater system (yet) but I'm financially stable, and when I want something I can usually just go buy it... with CASH...

Response by MAJ Private RallyPoint Member made Dec 22 at 2013 10:16 AM

MAJ Private RallyPoint Member — Sun, 22 Dec 2013 10:16:47 -0500

I would say as a whole no. I do think we owe it to our Soldiers and our peers to educate them. We are taught to take care of each other, this is just another way to do that. As a PL I took an active interest in my Soldiers' finances and educated them on the TSP. Did I get them all to participate? No, but I got about ten of them putting away 50 bucks a month into the TSP using the seasonal strategy. We all have to start somewhere.

Response by SFC James Baber made Jan 11 at 2014 10:59 PM

SFC James Baber — Sat, 11 Jan 2014 22:59:31 -0500

I think this is a good thread for those we are trying to get to join can see the substance of some things we discuss between us as current and former military, soft spoken as well as informational and mentoring types of postings.

We also have fun at times while remaining professional.

Response by SPC(P) Private RallyPoint Member made Jun 13 at 2016 10:23 PM

SPC(P) Private RallyPoint Member — Mon, 13 Jun 2016 22:23:39 -0400

I've given my platoon classes on the importance of investing since I was a PV2, it was shocking to see people not even having a clue what TSP was. From my experience we teach too much on managing debt rather than teaching about not being in debt and retirement. Besides mentoring in IT, I have no issue helping ANYONE out with setting up an Individual account, IRA, TSP, etc.