Money Mistakes Made by Military Families

Lots of us make mistakes with our money — even me. There’s a lot to learn, and we’re always stumbling into new situations.

While I’m educating people about their finances, I see the same oversights again and again. While the big ones are more obvious, there are a couple of seemingly smaller mistakes that can be just as dangerous, but are not always as obvious.

No Renters’ Insurance

Renters’ insurance seems like such a small thing, right until you have a catastrophic disaster and you have to use it. Even if you think that you “don’t have much,” think for a minute how much it would cost to replace even basic furniture, kitchen items, linens, clothes and uniforms.

Plus, renters’ insurance covers more than just your stuff. While every policy may be different, it also usually covers your liability if you do something wrong. (Forgot to turn off the stove? Left the water running in the sink?) or if someone gets hurt at your house. And most policies include loss-of-use coverage, which helps if your house or apartment is uninhabitable for some reason.

Unless your belongings are covered under a homeowner’s policy, you should have renters’ insurance. It’s cheap, and most insurance companies offer it. Check with your auto insurer, and then maybe shop around for other companies. If you really research it, it might take you an hour to find a good policy. Don’t wait.

Lunches/Vending Machines/Drive-Through Spending

This is a personal problem for me. In normal times, I spend way too much of my allowance on crap food and drinks. Even a healthy choice of an unsweetened iced tea is $2-$3 at most convenience stores and fast food restaurants. Start getting into actual food, and/or a car full of kids, and that bill grows exponentially. Do that a couple of times a week and then, next thing you know, you’re spending $200 a month on, well, stuff you probably don’t need.

Thankfully, there are easy ways to cut back on the amount you’re spending on food and drinks. Stock your work and car with drinks and non-perishable snacks. My family likes individually sized bags of popcorn, nut, and granola/snack bars, plus water and Gatorade. It is not uncommon for someone to leave the house with half a meal to eat on the way somewhere. Plus, we try to bring our own drinks when we leave the house. Every little bit helps!

Misunderstanding Your Income-Tax Situation

Taxes can be confusing, so it is understandable that not everyone has a firm grasp on what is happening with their income taxes. Throw in the constantly changing details of military life, and sometimes it feels like trying to nail Jell-O to the wall.

However, if you don’t know what’s going into your income-tax calculations, you can’t make smart decisions, like whether a second job will be worthwhile, or whether you want to put your TSP contributions in as Traditional or Roth. For example, many military families discover that a second income means that they receive a smaller Earned Income Tax Credit (EITC), which makes that income a lot less valuable. And if they don’t know how that second job is going to impact their EITC, they can’t add that to the other costs of working to see whether the job makes financial sense.

There are a couple of ways to fix this issue. I recommend that everyone go through their income-tax return line by line, and learn what it means. If you try that, and you’re still confused, have a chat with your installation’s personal financial educator. They can point out important parts that you should know, and help you project how certain decisions will impact your tax situation.

Leaving Military Benefits Unused

Military service provides a wide variety of benefits to service members and their families. Sometimes they are a little hard to find, and sometimes they are a little hard to use, but there is a huge range of programs offered by both the services and private organizations. Many families don’t even know that these opportunities exist! I’ve seen everything from a military spouse who thought she “didn’t have health insurance,” to service members who think that tuition assistance is too difficult to use, to families who aren’t getting a military discount on their cell phone bills.

This one can be a little trickier, because programs and deals and benefits aren’t always obvious, but you should definitely do research to see whether there is any way that you or your spouse’s military service can help decrease some of your expenses.

Each of these items seems relatively insignificant, but you might be surprised at how much they can cost. At the worst end of the spectrum, an apartment fire is a disaster if you don’t have insurance. But even that $2 iced tea adds up!

Not Knowing Where Your Money Goes

The first thing that most people need to do is figure out what they’re spending. Sounds easy, right? You’d be surprised! For most people, when we sit down and write down their income and expenses, there is a relatively large number left over at the end. So I ask, “Do you feel like you have $900 left at the end of every month?” Almost everyone says no, that they’re broke at the end of the month.

This problem is somehow both the easiest and hardest one to fix. It’s easy, because all you have to do is write down what you spend. It’s hard because no one wants to actually do that or they intend to do it, and then they don’t.

This is also the solution that can make the biggest impact on your overall financial health. Just knowing where your money is actually going is the first step in taking control over your financial future. So whether you use an index card wrapped around your debit card, an app on your phone, or throw all your receipts in a basket and tally them at the end of the week, do something to keep track of that money.

(Pro tip: Check your subscriptions. Do you really need Pandora AND Spotify? Netflix, Hulu AND Amazon Prime?)

What Veterans Need to Know About Federal Debts Right Now

Economic stress is affecting everyone right now, including military-connected students and veterans. It’s more important than ever that you know your rights. And you have some important new rights about your debts.

Your Stimulus Check Can’t Be Taken for Most Federal Debt, Even Unpaid Taxes

You should know that, if you received a stimulus check as part of the coronavirus stimulus package (the Coronavirus Aid, Relief and Economic Security, or CARES, Act) signed into law March 27, that’s your money. The CARES Act prevents the federal government from taking your stimulus money to collect on certain federal debts you might have, even unpaid taxes.

If You Have Student Loans from a Private Bank or Private Lender (Not the Government)

Private student loans are also not covered under the CARES Act. If you have private student loans, your lender or servicer may also be offering temporary payment modifications or forbearances as a result of the ongoing crisis.

The good news is that a recent Veterans Education Success report found that the number of undergraduate student veterans who take out private student loans declined significantly with the introduction of the Post-9/11 GI Bill in 2009. This is a very good sign. Private student loans come with far fewer protections and are almost always more expensive than federal student loans, as our new report explains.

In addition to lower interest rates, federal student loans offer a variety of repayment options that help borrowers cope with employment challenges that may affect their ability to repay, including income-driven repayment, public student loan forgiveness, forbearance and deferment. These options may not be available from private lenders. The variety of requirements and payment options in the private market presents a challenging landscape for individual borrowers. If you have a choice, it’s best to stick to federal student loans.

If You Owe a Debt to the Department of Veterans Affairs

The CARES Act required the Education Department and Treasury Department to pause debt collection, but the law did not do the same for those who owe a debt to the Department of Veterans Affairs.

Earlier this month, a veteran in financial distress came to my organization, Veterans Education Success, with a GI Bill debt and a landlord who was threatening to evict him.

“Jack” was forced to withdraw from a class last November due to his service-connected disability, which created an overpayment debt. His March and April housing allowance went to pay for that debt. In addition to appealing the debt through the VA appeals process, he made a payment arrangement with the VA where part of his disability check would go toward the overpayment each month. When he reached out to us, he had still not heard back from the VA. Despite his payment arrangements, when April hit, the VA took part of both his disability compensation and his housing allowance to pay the debt. “Jack” was going to school full time, and his wife is unable to work because she is immunocompromised. They had no money.

Fortunately, due to the decision of the governor in Jack’s state to halt all evictions for 45 days, we were able to prevent the most immediate harm from taking place. We were also able to help him resolve his claim with the VA, but not everyone is so lucky.

In response to requests from the veteran community, the VA suspended all actions on all types of veteran debts beginning April 9 for 60 days. Additionally, the department said it will consider extending the timeline (if the situation with COVID-19 makes that necessary) and will update its website to reflect the change and automatically extend suspensions for affected veterans.

The VA’s suspension of debt collection comes with two big caveats:

If you already entered into a repayment agreement with a third-party debt collector (like a collection agency or the Treasury Department), especially an automatic payment with the Automated Clearing House (ACH), those automatic payments will continue unless you contact the Treasury Department or the private collection agency to cancel the ACH.

In other words, VA debts that happened after April 9 will be automatically paused. But for debts that existed prior to April 9,, you must contact the VA to have them paused.

If You Have Federal Student Loans

If you have federal student loans held by the federal government, your monthly payment and interest rate accrual have been automatically suspended. Also, if you have defaulted on any federal student loans, the government is not allowed to come after you to “collect” on defaulted federal loans through Sept. 30, 2020. (But this covers only federal student loans that are owned by the U.S. Department of Education. Federal Family Education Loans, or FFELs, which were issued prior to 2010 by financial institutions such as banks, and Perkins Loans, which are typically owned by colleges and universities, do not qualify under the CARES Act.)

Media accounts have revealed that about 54,000 wage garnishments are still happening on federal student loan debts. They shouldn’t be. You can report them. Also, you can contact the debt collection company directly and ask whether the payment can be reversed or whether the collection firm has “hardship” programs that could temporarily suspend payments.

If you live in Illinois or Texas, those states have acted on their own to stop debt collection on federal student loan debt held by private entities. And California, Kentucky, Massachusetts, New York or North Carolina have also stepped in to stop some debt collection on student loans.

Special Military Benefits

While members of all branches of the military receive extensive military discounts, US Army Service Members and veterans have an exclusive set of benefits available to them. From career training and educational benefits to resources for families, Army Service Members should take advantage of these special benefits.

Army and Air Force Exchange

Through the Army and Air Force Exchange, members of the Army can purchase discounted goods and services. Not only do service members save up to 20 percent compared to traditional stores, but a significant portion of the profits from the Exchange support MWR activities. With its collection of stores and fast food restaurants, the Exchange provides employment opportunities for Army and Air Force family members as well.

State Benefits

Individual states offer their own benefits for Army Service Members and veterans. Some of the benefits offered by individual states:

    • Education and Transition
      State education programs typically offer special programs to help make up the difference between the benefits provided by the Post 9/11 GI Bill and tuition at state universities. In Missouri, the cost of credit hours at state universities is capped at $50 for service members and veterans. Other states cover the entire difference for veterans who choose to attend a public university. Individual states also seek to help soldiers transition to civilian life. Missouri’s Operation Outreach provides financial services, advocacy and other transition services for veterans. Virginia’s Employment Commission helps veterans with job placement and job training.
    • Taxes
      States such as Virginia and Missouri offer state income tax deductions for service members and veterans. Many states also exempt veterans from paying all or a portion of their property taxes.
    • Hunting and Fishing
      Army service members and veterans receive reduced price or free hunting and fishing licenses in most states. For example, in Virginia, for only $10, service members and veterans receive hunting and fishing privileges for life.

Education
Education benefits provided for Army members are designed to supplement the benefits given the military members through the Post 9/11 GI Bill®.

    • Army Green To Gold Program
      The Army’s Green to Gold Active Duty Option (ADO) is a two-year program offered to eligible enlisted active duty Soldiers allowing them to earn a degree and a commission by completing their first bachelor’s degree or their first two-year graduate degree.
    • Fry Scholarship
      Children of soldiers who die in the line of duty are eligible for the Marine Gunnery Sergeant John David Fry Scholarship. Recipients of the scholarship receive up to 36 months of full tuition and have until the age of 33 to finish using the scholarship.
    • Army College Fund
      In addition to the benefits from the Post 9/11 GI Bill, the Army College Fund provides money to cover tuition and training to help recruit service members for critical Military Occupational Specialties. Individuals may enlist in for a three to six year enlistment.
    • Army Continuing Education System
      Members of the Army, Army National Guard and Army Reserves have access to the Army Continuing Education System (ACES). Through ACES soldiers may request educational counseling, get their GED or complete a high school diploma or post-secondary degree program. ACES also provides testing and training related to civilian licensing and certification exams and manages the Army aptitude test.
    • Army Career and Alumni Program
      The Army Career and Alumni Program provides job placement services and counseling to help soldiers transitioning from active duty to civilian life. Program offices are located on military installations.

Additional Veteran Benefits Resources

Find veterans benefits offered by each state. Did you know that state, city, and community programs also offer a range of veteran benefits and programs for qualifying vets and their families?

City Websites, Chambers of Commerce Sites

Searching for veteran benefits by city can be a bit more challenging than searching for state resources. There are no real standardized templates for city sites, and you may find no help on one type of official site, while finding a large number of resources on a different city-specific resource.

It’s best to begin your search by checking the official page of your city, village, township, etc. If you have no luck there, try searching for veteran benefits on your local Chamber Of Commerce official site. While you’re at it, be sure to have a look at the U.S. Chamber of Commerce site for information on national programs such as Hire Our Heroes.

The U.S. Department Of Labor

This government agency offers a search tool to help veterans find career help in their local area via the DoL’s CareerOneStop program. You can search for local help from your nearest “American Job Center.”

The Department of Veterans Affairs

The VA official site has a by-state list of VA regional offices and state VA offices. Some of these site vary in detail from others, but many include lists of state resources for veterans that include both VA and non-VA benefit programs.

Organizations with Veterans Service Officers:

  • Veterans of  Foreign Wars
  • American Legion
  • Amvets
  • Disabled American Veterans
  • Paralyzed Veterans of America
  • Vietnam Veterans of America
  • Military Order of the Purple Heart

Some benefits are more well-known than others. Many states offer education assistance, housing, and employment programs for veterans. But there may be tax advantages, retirement home options, even business license exemptions available for qualifying veterans, depending on the state.

It’s always good to know as much about your state options as possible-you never know when you might need to apply for these lesser-known programs.

The U.S. Army Official Site

MyArmyBenefits.usarmy.mil offers a very helpful state-by-state clearinghouse of benefits information searchable by clicking on the appropriate state or using a pulldown menu to access information on that state’s education, employment, insurance, and other benefits. You can also find locations to that state’s VA clinics and other VA resources in this one-stop guide.

Examples of Available Veteran Benefits

Housing Benefits

There are the obvious benefits for veterans seeking e.g. VA mortgage home loans from participating lenders all over the United States, but on the state level there are some options that may be of help later in life, such as Arkansas’ state veteran retirement homes.

That benefit is offered to honorably discharged military members with a priority for Arkansas residents. Other programs include Minnesota’s short-term assistance with rent or mortgage payments for qualifying veterans.

These benefits are likely best found via the state’s official site or the state VA regional office official site such as the one for Minnesota.

Finding state-level veterans’ benefits may seem daunting at first. But you’ll discover that getting to know your state’s official site and your state-level Department of Veterans Affairs official site is an excellent way to get caught up on these benefits, future legislation or state planning that might affect them, deadlines for applications, and points of contact in your community for learning more.

Education Benefits

Many states offer some kind of supplemental or replacement education benefit for veterans. In Illinois, a program known as the Illinois Veterans Grant is for qualifying veterans who listed Illinois as their home of record while serving, or who joined the military while living in the state. This program offers full tuition coverage that can be used separately from or in conjunction with the GI Bill.

Other states offer free or reduced tuition for the dependents of military members. California, Alabama, and other states offer such programs, which may be subject to change from year to year due to legislation or budget issues.

One of the best resources you can use to find these education benefits in your state? Your local state college or state university official website. You will find that in most cases, these sites will have specific information on the veteran education assistance programs offered in that state and how to begin.

These are often listed under a heading in the Admissions section. Look for “Paying For College” or “Student Financial Assistance” headings.

Tax Benefits

Some states, including Texas, California, Alabama, and others, offer tax breaks to veterans in the form of exemptions or tax-free income options. Alabama has an exemption on military retirement pay, California offers property tax exemptions to qualifying veterans, etc.

You will find tax exemption information on your state’s official site. It’s not safe to assume that any tax breaks you may be entitled to are automatic. Consider the requirements of the New York State official site which includes the following:

“If you’re an eligible veteran, you must submit the initial exemption application form to your assessor. The deadline in most communities is March 1—please confirm the date with your assessor. Proof of discharge under honorable conditions including times and places served in active duty (usually form DD-214) must be attached to the exemption application”.

Military Retirement: Financial Issues

You will face many challenges and opportunities as your retirement approaches. And, planning for your family’s financial security is one of those challenges. This guide is merely intended to give you some things to think about as you begin your transition to civilian life. It’s based on my personal experiences and feedback from countless counseling sessions.

Most retirees will find that they still require private, individual life insurance. Many experts recommend a mix of both permanent (whole life) and term coverage.

Insurance

Life Insurance Planning is not easy. Most people spend more time researching and buying a new car than they spend putting a good plan in place for the financial security of their survivors. Below are some common life insurance mistakes to look out for. Call one of our Counselors or another life insurance professional to learn more about avoiding these mistakes.

  1. Making policies payable outright t minor children/grandchildren.
  2. Failing to review your coverage periodically to ensure that it adequately addresses the changes in your life.
  3. Naming your estate as beneficiary
  4. Failing to name contingent beneficiaries and failing to keep beneficiaries up to date
  5. Not having enough insurance (Use Navy Mutual’s Needs-Based Calculator).
  6. Forgetting the termination date of your Term plan.
  7. Buying insurance as a commodity. Seek the help of a knowledgeable life insurance professional. Our Counselors can help you determine what is best for your family.
  8. Failing to buy the right type of life insurance (Term and Permanent insurance both have a place in your plan).

Disability Insurance. This is one area that most active duty service members don’t think about since they enjoy significant benefits when they become disabled in the line of duty. However, as a civilian, you should pay particular attention to this insurance. If you are starting a second career, most employers will provide you with both a short-term and long-term disability policy on a group basis. You need to review these plans carefully to ensure the protection is adequate. Don’t forget, your excellent military pension continues for life even if you become disabled. This is a significant benefit that you have over your civilian counterparts. You should also evaluate your occupation and your avocation to see what affects they may have on this decision. Is your occupation one such that there is an increased probability of disability? Is your occupation one in which a disability would end your employment? For example, a surgeon who suffers a disabling injury to his/her hands or an airline pilot whose vision becomes impaired? Purchasing an individual disability policy may be a consideration.

Property and Casualty Coverage. This is the one area of insurance planning that you may have best under control. However, if you move to a new state to begin your retirement, you will need to re-evaluate your Homeowner and Automobile policies. Some retirees also look at insuring their household goods in order to have adequate protection as they are trucked off to the new homestead. Look to companies that serve service members and veterans as their primary mission, such as USAA and Armed Forces Insurance (AFI).

Financial Planning

I am not going to tell you which stocks, bonds or mutual funds to buy. But, I will hopefully stimulate some thoughts as you make a significant financial transition in your life. A very small number of military retirees truly retire when they leave the service. However, for most military retirees, retirement means starting a second career when they are not financially secure enough to stop working. In most cases, this second career will provide you with a significant increase in discretionary income and an excellent opportunity to save for your eventual full retirement. It is a great time to plan and a good time to seek the services of a professional financial planner. Most planners will tell you pretty much the same thing: When you get ready to retire you will need to establish an income stream of about 80 percent of your final working income to sustain your lifestyle. This income will come from three sources: a pension, Social Security, and private savings. The good news is that as a military retiree, the first two already provide you with a solid foundation.

Individual Retirement Accounts (IRA). You probably have an IRA established for both yourself and your spouse. You may have ROTH IRAs that are superb vehicles for retirement savings since you never pay taxes on any money that comes out of them. However, when you start your second career, you may no longer be able to contribute to your ROTH because your Adjusted Gross Income (AGI) will exceed the allowable limits. You may need to shift to a conventional IRA. How much can you contribute each year? If you are over age 50, are you taking advantage of the “catch up” provision? When can you withdraw funds without penalty? When do you have to start withdrawing funds? These are important questions.

Social Security is probably something to which you have not paid much attention. You should because it is the second important element of your plan. Review your most recent Social Security statement carefully with your spouse. If your spouse has a work history, review his/hers as well. Pay particular attention to the retirement estimates. You need to consider several things: How long do you want to work? When do you want to start drawing retirement benefits? What effect does earned income have on Social Security benefits? How does your military pension affect Social Security benefits? (I’ll answer that one now — it has no effect!) Do you understand that special Military Service Credits may be available to you? Is it better for your spouse to draw retirement based on their Social Security Account or your account? Why would you want to wait until age 70 to start drawing benefits? Answers to these types of questions will be important inputs to your financial plan.

Your military pension is one of the best, if not the best, pensions that exists in America today — Cost of Living Allowances (COLA) protected, income for life starting the month following your retirement. It is so valuable that there are companies willing to “buy” your pension from you. Do not be tempted, these schemes are egregious rip-offs. Your pension is the first element of your financial plan. Another piece of advice is to use the “myPay Account” feature available on-line with DFAS (https://mypay.dfas.mil) to monitor and make changes to your retirement account. Remember in almost all cases your active-duty allotments will carry right over to your retired pay account.

Private Savings is for many, the most important element of their plan. How much savings you have now? How much do you need to fund a comfortable retirement? How do you get there from here? Answer those three questions and you have your plan. You may be able to go it alone, but most retirees would probably benefit from some professional help.

  • Qualified Employer Retirement Plans. Your second career will most likely come with a new retirement plan opportunity. They come in the form of qualified plans that means that they enjoy favored tax status. Contributions to some plans can be made with pretax dollars. All plans allow your money to grow tax-deferred. Most employers offer a 401 (k) Plan. A relatively new variation is the Roth 401(K) that is funded post-tax dollars. What type of plan does your new employer provide? This may be an important factor in your job search if you are still looking. Is it a defined benefit plan or a defined contribution plan, or are both types offered? Which is better? If it is a defined contribution plan, does your employer provide matching contributions? How much? How much are you allowed to contribute each year? Are there “catch up” provisions for those over age 50? How long before you become vested? Is the plan “integrated” with Social Security? Is the plan portable if you leave that employer? The last question is important since many military retirees change employers four times or more. When can you start drawing a retirement benefit? Does that benefit enjoy COLA increases? What if you start your own business? What retirement plans are available?
  • Thrift Savings Plan (TSP). Hopefully you were able to take advantage of this Military 401 (k) plan. It is a good solid qualified retirement plan. It is comprised of five funds with different focus that provide good diversification and it has an incredibly low fee of only six basis points. The plan has recently added a six fund – a Lifestyle Fund which uses a combination of the five previous funds to meet your retirement goals. However, once you retire you can no longer contribute to the TSP. What are your options? You can keep it and continue to manage the funds inside the plan as your assets continue to grow. In many cases, you may be able to roll it over into your new employer’s qualified plan. In some cases, you may be able to roll it over into your personal IRA. Which option is best for you?
  • Deferred Annuities. Once you have maximized your contributions to your IRA and employer retirement plans, you may still want to invest more money on a tax-deferred basis. A Flexible Premium Deferred Annuity (FPDA) is one product that allows you do this. Annuities can be either fixed or variable. A variable annuity has more risk because it is invested in the equity market and therefore also offers the potential for higher returns. Fixed annuities are more conservative, but they also have a guaranteed minimum interest rate. What is your risk tolerance? Which annuity is right for you? Navy Mutual offers an excellent fixed FPDA. To learn more about annuities, visit our website and review our Annuity Tutorial or call us and ask for a copy of the annuity tutorial pamphlet.

Taxes. Most retirees are shocked by the big jump in their tax brackets. Military compensation has many tax benefits that will no longer exist in your civilian career. Most retirees will receive a straight salary instead of the more complicated system of military pay and allowances. Maybe you avoided state income tax during your military career and that may factor into where you live in retirement. You should note that just because a state does not have a state income tax does not mean it has a low-tax burden.

How will your military retired pay be taxed? One thing to remember is that there is no FICA tax taken from your military retired paycheck. Be prepared for your first tax return to be a little more complicated than it was in the past, and expect to see a larger tax bill. You may get into the business of paying estimated taxes for the first time in your life. You may also get caught up in Alternative Minimum Tax (AMT) provisions. You may feel it necessary to visit a tax professional. There are a few things that you may be able to take advantage of in the tax area. First, you may be able to defer tax on some income by contributing to a qualified retirement plan as discussed above. Your employer may offer a Flexible Spending Account (FSA) that allows you to use some of your salary on a pre-tax basis for qualified medical expenses and childcare. There may be some other areas where tax breaks are allowed that you had not considered. Be prepared to do some tax planning.

A prominent financial planning firm notes the following nine big mistakes that people should avoid when saving for retirement. They are provided here for you consideration as begin, review, or refine your financial plan:

  1. Relying solely on the investment returns of your portfolio.
  2. Forgetting about the effects of inflation.
  3. Not having a properly allocated portfolio.
  4. Underestimating taxes.
  5. Underestimating your spending during retirement.
  6. Having unrealistic investment expectations.
  7. Underestimating the time you will spend in retirement.
  8. Failing to plan for unexpected health care expenses.
  9. Mismanaging your tax-deferred assets.

In summary, retiring from the military and beginning a second career offers enormous opportunities for securing a very comfortable, financially secure and full retirement. Do not waste these opportunities by failing to plan.

Estate Planning

Estate planning is not a pleasant subject or an enjoyable task. What is estate planning? Estate planning means more than simply preparing a last Will and Testament. In its broad sense, estate planning must address the administration and protection of assets during your lifetime and for decision making in the event that you are unable to make decisions for yourself.

Estate Planning also involves the preparation of several key documents: a will, one or more Durable Powers of Attorney, Advance Health Care Directives, Living Wills, and one or more trusts. What do these things do? Which do you need? How do you have them prepared? Who should be involved in the planning? These questions should be considered during the planning process. While you can do many of these things yourself, this is one area where professional legal advice is essential if you want to ensure the documents? validity for you and your family. The military Legal Assistance Centers can prepare many of these documents for free while you are still on active duty and many of these centers may offer services to retirees on a space-available basis.

However, estate-planning issues can become very complicated and they vary widely from state to state, so you may need the advice of an estate-planning attorney. Estate planning firms may offer a free consultation to assess your needs and then will discuss what they will provide and their fees. A comprehensive estate plan includes all the documents above plus some continuing service can cost about $2,000 to $3,000. The more complicated your estate, the greater the cost. Most retirees have relatively simple estates so costs can be less. Just because your estate is simple now does not mean that you will not need estate planning in the future. Also, estate planning is not a task reserved solely for the elderly.

Trusts can help avoid tax liabilities. While most retirees may not have estates large enough to be concerned about estate and inheritance taxes, this can change. Hopefully you will see a substantial increase in your estate as you pursue your second career. Also, many retirees underestimate their estates by failing to include the real value of their home or by failing to include the large death benefits of their life insurance policies. In some cases, there is even a value attached to survivor pensions such as SBP. So while tax planning should not be a major focus of a trust, it can be a valuable tool.

Incapacitation. What if you are involved in a serious accident or contract a serious illness? Who will make the decisions regarding your medical care? What medical measures do you want taken to save your life? What if those measures reduced you to a prolonged vegetative state? Who has the power to make significant financial decisions if you are incapacitated? Who will take care of your children if you are unable to do so? Durable Powers of Attorney, Living Wills, and Advance Health Care Directives can answer most of those questions. A Will is used to designate the guardians of your children. All of these are legal documents — and in today’s litigious society are challenged frequently. This is why they need to be prepared by competent attorneys. These documents represent the cornerstones of your estate plan.

Trusts. Many people consider trusts something that only the wealthy need and use. However, a trust can be a valuable tool for almost anyone. A trust is a set of instructions that tell the world how you want things done if you are not around or able to do them yourself. The most popular and widely used trust is a revocable trust that you own and manage while you are alive. It also carries out your wishes when you die. There are some key reasons why you might want to consider a trust:

Trusts avoid probate. Trusts avoid delays in settling your estate and will save your survivors both time and money. Another good reason to avoid probate is privacy. Any of your assets that pass through a normal probate process become part of the public record and are available to creditors and others who might want to take advantage of your family. Trusts are private.

Trusts can help plan for known or unexpected family situations. How can a disabled child, sibling or parent be cared for? How can you ensure that funds will be available and be used to fund college education for your children? How can you protect your married children in the event of a divorce? How can you ensure funds are controlled so that they do not pass to a person who is not mature enough to receive them? How can you prevent a guardian from squandering your young children?s inheritance? How can you help a family member with a drug or alcohol problem? There is an almost endless list of problems and issues that can be helped by a properly prepared trust.

Trusts can be used with Life Insurance Planning. A trust can own or be the beneficiary of a life insurance plan. Residuary trusts can be set up to dispense the proceeds of a large policy to your children in a controlled manner if you and your spouse should die prematurely. An estate planning attorney/tax expert should be consulted to discuss the advantages of using trusts with life insurance.

The estate planning tools and documents will be based on your own family circumstances. Hopefully, I’ve given you some things to consider. Most retirees would benefit from speaking to a professional to get additional insights. However, there is one element of estate planning that every retiree should seriously consider. For example, have you informed your family of your wishes if you should pass away? And have you provided them with sufficient information on your finances and other key issues that will allow them to carry on when you are gone?

Health Care Planning

As a retiree, you are pretty well set as far as medical care goes, especially when compared to the average American. Tricare provides an array of options for health care and Tricare for Life ensures that when you reach senior citizen status you will be well cared for when Tricare and Medicare benefits are coordinated.

Dental Care. Dental Care is an important health care benefit that you need to replace. Most employers provide some type of dental plan as an employee benefit. If not, you are eligible for the Retiree Dental Plan. However, be prepared to absorb some out-of-pocket expenses if you have any dental issues above the normal two cleanings per year. Even the best plans only cover 80 percent for routine fillings and major work such as root canals and crowns may only be covered at the 50 percent rate. A couple of bad teeth can reach that maximum quickly.

Tricare provides you and your family with an excellent medical care benefit. Get a good briefing on the program at the Transition Seminar so you enroll in the option that best fits your needs. Tricare Prime is probably your lowest out-of-pocket option if you are near a military health care facility. You may also want to purchase a Tricare Supplement Policy at age 65. When you turn 65-years-old Tricare-for-Life kicks in and no further supplemental policies are needed.

Tricare and your Civilian Employer. Most retirees pursue a second career with a civilian employer. Typically, the most expensive employee benefit is the health care plan, so you may be able to leverage your Tricare benefit to your advantage. In many cases, an employer will be willing to compensate you for declining their health care plan in favor of Tricare. For example, they may pay all your Tricare costs as an alternative or provide you with an increase in another benefit, such as a better dental plan increased life insurance, etc. This is worth discussing with your employer. If your employer offers a cafeteria plan for benefits, staying with Tricare will give you an opportunity to select other employee benefits from the menu.

Flexible Spending Accounts (FSA). One great way to mitigate out-of-pocket health care expenses is to pay for them with pre-tax dollars. You can do that through an FSA if your employer offers one. An FSA allows you to put cash out of your salary and into a pre-tax account which can be used to reimburse you for out-of-pocket health care expenses, often including many over-the-counter medicines. You must use all the funds in your FSA each year or any unused funds will be forfeited. I suggest that you might want to be conservative at first until you get a feel for your medical expenses. You can also establish a separate FSA up to $5,000 to pay for child cares/adult day care expense. Discuss the FSA with your new employer’s HR director.

Long Term Care (LTC). Long term care is one area where you are not covered. Neither Tricare nor Medicare provide for custodial care which is what most LTC consists of. Medicaid is usually a non-starter for a military retiree due to your pension. LTC is a growing topic of interest in this country. Statistics show that with people living longer than ever. The probability of their needing some type of assisted living is also rising. In your family, the person with the most need is usually the female spouse This time of transition from active service, may be a good time to consider your future LTC needs and start planning now.

Long Term Care (LTC) Insurance Plans. These are plans that you purchase much like Term life insurance. You pay an annual (or more frequent) premium and if you meet one of the triggers for LTC your plan pays you a monthly amount. These triggers are either one, the inability to perform two of the five or six Activities of Daily Living (ADL) without assistance or two, serious cognitive impairment such as dementia or Alzheimer’s Disease. ADLs typically include eating, bathing, dressing, toileting, and transferring from bed to chair. LTC Plans have a variety of benefit elections which impact the price, such as the amount of the daily benefit, the length of the benefit period (usually three to five years), the length of the elimination period, inflation protection options, etc. Your age is a major factor in your premium costs. The best place to start is with the Federal LTC Program. Use it as a benchmark.

Self-Insure. Some financial professionals believe that if you have sufficient assets, you can provide for you and your spouse’s long term care. However, there is a risk that you could run out of funds and, of course, any assets used for long term care would not be available for other uses or for passing them on to your family. You should consider seeking the counsel of a financial professional if you think you can self insure. Additionally, some of the other options below could be used as part of your overall LTC Self Insurance Plan.

Family Care. About 70% of long term care is still being provided by family members. However, this can be a significant physical, mental and financial burden on a family. It can require modifying a home to accommodate the LTC needs of a person. In many cases, families eventually have to turn the care over to professional care givers or turn to a nursing home anyway. Some children have also turned to paying the premiums for LTC Insurance for their parents.

Continuing Care Retirement Community (CCRC). One popular self-insurance plan is a CCRC. These are facilities that offer the full range of living arrangements ? from separate homes or apartments where couples live independently, to nursing facilities where a person requires continuous LTC. There is typically a large entrance fee ($100,000 to $300,000 or more) and then a monthly fee ($1,000 to $3,000 and up). For those with sufficient assets CCRCs offer an attractive option for insuring LTC needs.

Annuities. An annuity can provide monthly income for life or for a specified number of years. This income could be used to fund LTC needs or could be used to pay LTC Insurance premiums. The best way to use an annuity for this purpose would be to purchase a flexible premium deferred annuity at a young age and then make monthly contributions to it. Let it grow tax deferred and then annuitize it later in life to pay for LTC expenses. This is probably not a viable option for most retirees. However, it might be an option for a younger retiree. There are also some hybrid annuities available that can have a LTC Option where the annuity payment would be increased if the annuitant met certain LTC criteria.

Life Insurance. Some permanent (whole life) life insurance plans have a LTC Option which allows an accelerated payout of the death benefit if the insured meets certain LTC criteria. Again, this would work best if the policy were purchased at a younger age with lower premiums. Most retirees will find whole life insurance to be an expensive alternative. However there are advantages: You have the LTC protection if you need it and life insurance and cash value if you don’t require long term care, so it may be well worth the cost.

Reverse Mortgages. A reverse mortgage is a nonrecourse first mortgage loan against a home’s market value that advances cash to the borrower who remains the homeowner. It requires no installment payments, and proceeds from the sale of the home are used to repay the loan when the borrower no longer maintains the home as a principle residence (e.g. dies or moves into a nursing home, etc.) A reverse mortgage is an option for obtaining funds to pay for LTC. Reverse mortgages are provided through the federal government and private lending institutions.

What is ‘The Survivor Benefit Plan’?

When a military retiree dies their retirement pay stops. This means that the surviving spouse will be left without a substantial income source. If you are a retiree you need to give serious thought to how you can protect your spouse from the hardships caused by the loss of your retirement pay.

One option available to you is the Survivor Benefit Plan (SBP). The SBP is an insurance plan that will pay your surviving spouse a monthly payment (annuity) to help make up for the loss of your retirement income. The plan is designed to protect your survivors against the risks of:

  • Inflation
  • Your early death
  • Your survivor outliving the benefits

How SBP Works

At retirement, full basic SBP for spouse and children will take effect automatically if you make no other valid election. You can’t reduce or decline the SBP without your spouse’s written consent. This means you will have to have your spouses input in the decision and their signature is required.

You may choose coverage for a former spouse, children, or you may be able to cover an “insurable interest” (such as, a business partner or parent).

If you elect to participate in the SBP you pay a monthly premium. The premium is based on how much SBP coverage you select.

Your SBP coverage can be any amount from full coverage down to as little as $300 a month. If you elect higher SBP payments on your death your monthly payments while you are alive will be higher.

The highest your SBP can be is 55 percent of your retirement pay.

There are several categories of beneficiaries that you can have the SBP for. The categories are:

Child Only

This option pays the SBP only to your children regardless of whether you are married or not. Your children will get the SBP until they turn 18 or age 22 if a full-time, unmarried student.

Children mentally or physically incapable of self-support remain eligible, while unmarried, for as long as the incapacitation exists.

Spouse Only

The surviving spouse be a widow or widower who was married to you when you enrolled. If you marry later, you can add your spouse, but they must be married to you for at least one year prior to your death to get any benefits.

Spouse (or Former Spouse) and Child

You can also elect to cover your children under this category of coverage. This coverage pays to your spouse while they are alive. If they die before you it will pay to your children after your death.

Disabled Dependent

You can also contribute your SBP payments to a Special Needs Trust (SNT) to allow a disabled dependent to continue receiving federal disability payments.

A SNT is a trust designated for beneficiaries who are disabled, either physically or mentally. It is written so the beneficiary can enjoy the use of property that is held in the trust for his or her benefit, while at the same time allowing the beneficiary to receive essential needs-based government benefits. Talk to a financial advisor for more information.

Former Spouse

If you have a former spouse when signing up for the SBP you can elect coverage for them.

If you have more than one former spouse, you can only choose one. If you add a former spouse, your current spouse doesn’t get anything.

Person with a Natural Insurable Interest

If you don’t have a spouse or kids you can elect SBP coverage for a person with a natura insurable interest in the member. This usually includes business partners.

The Department of Defense defines a natural insurable interest as “a natural person with an insurable interest who has a reasonable and lawful expectation of financial benefit from the continued life of the participating member, or any individual having a reasonable and lawful basis, founded upon the relation of parties to each other, either financial or of blood or affinity, to expect some benefit or advantage from the continuance of the life of the retired member.” If the election is for a person who is more nearly related than a cousin, no proof of financial expectation is required.

Again, talk to a financial advisor.

Inflation Protection

Like your retirement pay the SBP annuity is protected from inflation. Each year when retired pay gets a Cost-of-Living Adjustment (COLA) so does the SBP.

Remember, since the SBP coverage amount goes up with COLA, your premiums will go up too.

How to File Your Taxes When You’re Deployed

Deployed service members are expected to file their taxes. Fortunately, the Internal Revenue Service realizes service members and their families face unique circumstances and offers tools – and some special extensions – to make tax filing easier. Military OneSource also provides a suite of free tax services for eligible service members and their families.

Getting help filing taxes, getting an extension

In addition to serving in a combat zone, there are other ways service members can obtain an extension on filing taxes beyond the July 15 deadline.

Other tax assistance for service members and their families can be obtained through:

  • The IRS has a web page on tax information for military members who serve in the U.S. Armed Forces and uniform services.
  • The Volunteer Income Tax Assistance program. Offered for free by the IRS, this program is for those living on or off the installation and includes sites for military members overseas. VITA staff can help you with military tax issues.
  • Military OneSource MilTax free tax filing services. MilTax preparation and e-filing software, available Jan. 22 through Oct. 15, allows you to prepare and file your federal and state taxes with ease. It’s designed to address military-specific scenarios, such as those described above.

Getting started on free military tax filing

If you are a service member or filing taxes on behalf of a service member, keep the following in mind when getting started on your taxes:

  • Make sure you have a power of attorney in place if someone is filing on your behalf. If your spouse or someone else is filing your tax return, make sure they have all your information and attach the power of attorney – a legal document that provides them authority to make financial decisions in your absence. The person filing your taxes on your behalf will need to attach IRS Form 2848 with the tax return.
  • Get your statement online: You can go to myPay to get your military W-2 form. It is posted there before being mailed to you. You’ll need your Common Access Card or personal identification number to access it.
  • File the return in your permanent state. If you are stationed away from your permanent home address, you will still pay taxes in your home state in most cases. Note: military spouses who work and live with their service member in a state other than their home state as a result of military orders may not have to pay income tax in the state where they work.
  • Gather other important information. Other documents you may need to file your taxes include 1099 forms, deduction and credit information, receipts for child-care expenses, last year’s tax return, and any documents for investments, rental properties or mortgages. You’ll also need your military ID and every family member’s Social Security number, bank account and routing numbers if you are filing electronically, and receipts for charitable donations.

Deadline extensions for combat zone and hazardous duty

Filing your taxes after the July 15 deadline is more common than you think. This is especially true for service members who are deployed. The IRS extends filing deadlines – and paying of your income taxes – for service members who are:

  • Serving in a combat zone or directly supporting those in a combat zone, serving in a contingency operation, or having a “missing” status. Your tax extension generally starts the day you begin serving in the combat zone for the period of your service plus 180 days afterward. The spouse and family members of those serving in combat zone or contingency operation sometimes also qualify. Your command will notify the Internal Revenue Service of your deployment, so you can receive an automatic federal tax return extension. You may still want to write “COMBAT ZONE” in red on top of your tax return when you do file.
  • Hospitalized outside the United States because of injuries suffered in a combat zone or hazardous duty area. This applies for the period the service member is continuously hospitalized outside of the United States as a result of injuries sustained while serving in a combat zone, including 180 days thereafter. For hospitalization inside the United States, the extension period cannot be more than five years.

Preparing and filing taxes is a citizen and service member duty. But as a member of the military family, you can obtain 100% free access to tax consultants and financial counselors with military expertise.

Military Financial Support

Service members and their families have access to substantial resources to save money and manage your expenses. Learn more about different military pay and compensation benefits and ways to save and protect your family’s financial health.

Prevent Identity theft and fraud

  • File a complaint on the Consumer Complaint Database at the Consumer Financial Protection Bureau if you have an unresolved issue with a company about a financial product or service.
  • The Federal Trade Commission has a website devoted to reporting Identity Theft and getting a recovery plan.
  • Federal law entitles you to a free credit report each year. Check it for suspicious activity. If you’re a deploying service member and don’t plan to seek new credit while deployed, place an active-duty alert to reduce the risk of getting swindled.
  • Monitor your credit report for signs of identity theft—especially if you’ve lost important papers. All Americans are eligible for a free credit report once a year from each of the three major credit bureaus: Equifax, Experian and TransUnion.
  • Check out the Task Force on Market Integrity and Consumer Fraud for more information on scams that target the military.

Help with taxes

  • Military OneSource provides free tax preparation and filing services and tax consultations.
  • If you prefer a face-to-face meeting with a military tax consultant, the military-based Volunteer Income Tax Assistance program provides no-cost tax advice and preparation, return filing and other tax assistance to military members and their families. Find a Volunteer Income Tax Assistance location near you.
  • Learn more about free tax services available through Military OneSource.
  • The IRS has a detailed Armed Forces’ Tax Guide.
  • Earned Income Tax Credits are federal income tax credits for low- and moderate-income working individuals and families. The refundable credit can generate a refund if you do not have any taxes to pay. Service members and families may have an easier time qualifying for the credit because some military income, such as pay earned during service in a combat zone or basic allowances for housing, are non-taxable and are not included in an individual’s or family’s total income.

More ways to save and take control of your finances

About to make a purchase? Or want to pay off your debt? Saving for college? Use a financial calculator to help manage your money. Better yet, meet with a personal financial counselor for free to discuss any money matter.

  • The Servicemembers Civil Relief Act also provides service members with a range of rights and benefits, from interest rate reductions to eviction protection. Know your rights and available perks.
  • Achieve everyday savings by shopping at your military installation’s commissary and exchange. Shoppers typically save more than 30 percent compared to shopping in town.
  • Check out Benefits.gov, which houses information on the wide range of benefits available to active-duty military and veterans. A go-to resource for all service members and families, it has information on interest rate reductions, tax benefits, educational and medical benefits, and many other benefits you’re entitled to.

Need help after a natural disaster? Find assistance via:

  • DisasterAssistance.gov helps you search for disaster relief by the type of assistance you need or by federal agency.
  • The American Red Cross provides disaster recovery information and specific tips for coping with different kinds of disasters, including fires, hurricanes, floods and winter storms.

The National Resource Directory

The National Resource Directory (NRD) is a government resource for military members, veterans, dependents, and health care professionals. This website offers a collection of resources to help wounded warriors and those who care for them in a variety of areas.

Started in 2008, this effort is a partnership between several federal agencies, including the VA, the Department of Defense, and the Department of Labor. There are other partners, too; the Red Cross and a government agency coalition called Community of Care are just two working to support the NRD.

The Goal of the NRD is to be an information clearinghouse on a variety of important areas; with a great variety of services and support resources available (more than 16 thousand at the NRD at the time of this writing!) the National Resource Directory focuses on (but is not limited to) the following Resource Categories the NRD site offers information on:

  • Military Adaptive Sports Program
  • Benefits & Compensation
  • Portfolio of Veterans Benefits (PVB)
  • Health
  • Family & Caregiver Support
  • Choose Home
  • Education & Training
  • Homeless Assistance
  • Other Services & Resources
  • Housing
  • Transportation & Travel
  • Employment

How To Use The National Resource Directory

The NRD site is divided by category (see the bulleted list above). On the main page of NRD you can select one of these categories to be taken to a search page with a list of ways you can filter search results.

For example, clicking on the Health category takes you to a page with a sidebar that offers checkboxes to help you narrow down your search for Health resources based on whether you are a veteran, a family member, caregiver, active duty, etc. You can also select whether to search for a non-profit, a government agency, or an educational institution.

Checking the boxes for these options will add more search results. A search under Health with only the check box “health” selected gives you approximately 242 pages of resource links such as the link to the Hurlburt Field Behavioral Health agency, fact sheets for the National Child Traumatic Stress Network, other state and local health resources, etc.

A search with additional terms such as choosing both the Health checkbox and selecting search results for Government Agencies turns up fewer results (about 120 pages) but more specific ones.

Resources You Will Find At The National Resource Directory

Each of the resource categories linked to on the NRD official site has a list of subheadings you can choose from to get started. For example, under the resources heading, Benefits and Compensation, you will find the following additional topics:

  • Survivor & Burial Benefits
  • Defense Enrollment Eligibility Reporting System (DEERS)
  • VA Benefits
  • DoD Benefits
  • Facility and Records Locator
  • Life Insurance
  • Social Security Benefits
  • Filing Claims & Appeals
  • States & Territories
  • Unemployment Benefits
  • Forms

Under the very first item in that list, the Defense Enrollment Eligibility Reporting System (DEERS) includes a page of related items such as a resource on how to get your Uniformed Services ID Card; this portion of the NRD site includes a link to DD Form 1172-2, an application form you need to download to apply for the card.

This is quite common-when a service member, veteran, or military family member might need to download a VA or DoD form, those forms are commonly made available via NRD.

Another resource listed under the DEERS category is a link to the TRICARE Defense Enrollment Eligibility Reporting System, which according to the official site, “Provides instructions to help active duty and retired Service Members verify and update their family’s information” in DEERS.

Of the many options under the resources section, the most useful to some will be the options found under the Filing Claims And Appeals heading, which returns eight pages or more of information (depending on how you search as a veteran, military member, as a caregiver, etc.).

This section includes VA paperwork such as VA Form 21-22, the Appointment of Veterans Service Organization as Claimant’s Representative form, but also links to lists of Veterans Service Organizations such as the DAV, Red Cross, VFW, etc. as well as listings for state-level Departments of Veterans Affairs or Divisions of Veterans Services.

The search returns for this site are filtered, but you may need to further refine a search or do more clicking through than you might expect. The resources found here are valuable, but they are not necessarily organized alphabetically, or displayed in terms of relevance. The search tool here is an excellent starting point for information gathering, but you may need to do a bit of extra work to group links to what you seek to organize them properly.

NRD Partnerships and Communities

The NRD official site includes a list of community resources from the agencies it has partnered with including:

  • The American Red Cross
  • Portfolio of Veterans Benefits
  • Choose Home
  • Community of Care

Each of these communities is linked to at NRD, with search results for helpful resources associated with each agency, some that may be peripherally linked to the VA or one another, or stand-alone, depending on the nature of the resource.

American Red Cross

The NRD official site describes the American Red Cross as “a humanitarian organization that provides emergency and non-emergency services, disaster relief, and disaster preparedness education in the United States to individuals, families, and military Service members.”

The Red Cross specifically helps service members and their families through emergency relief, personal loans for family crisis issues, location of service members in times of a family emergency, etc.

Portfolio of Veterans Benefits

The Department of Veteran Affairs’ Portfolio of Veteran Benefits offers “programs of care, compensation and commemoration for the Service member and Veteran communities and their families” to include education, career services, health counseling and care, etc.

Choose Home

This is described as “a new initiative designed to allow Veterans to remain in their homes over institutional care” and focuses on both research and interaction with military family members.

Community Of Care

Community of Care is a group of government agencies that collaborate on health care and other services that are “approved by Department of Defense and Veterans Affairs” according to the official site.

How To Contribute Resources To The National Resource Directory

You can contribute resources for review to the NRD online via the site’s Submit a Resource page; that link allows you to submit a URL, title, and description for your suggested resource. The ability to submit is not restricted to “official” channels.

An agency, non-profit, or individual may suggest new resources for review. You can also submit an update for an existing resource listed on the site. Submissions should include the appropriate audience, plus any relevant existing subject topics (there is a list provided on the electronic submission form).

General Guidance On Suggested NRD Resources

NRD.gov offers resource links to local, state, federal, and tribal government entities, services, and programs to include public/private partnerships between government and private sector operations.

Non-government resources must meet NRD criteria in order to be linked to on NRD.gov. These requirements include being accessible and relevant to military members, veterans, families, and care providers serving all the above. The information linked to must be “consistent with the government’s privacy and security policies for the privacy of personal information” and based in the United States.

Submission of Charities And Not-For-Profit Resources

There are certain requirements of charities and not-for-profit agencies who wish to be linked to by NRD. These agencies must serve and support wounded warriors, family members, veterans, care providers, etc. Charities must:

  • Have tax-exempt status under section 501(c) (3) of the Internal Revenue Code and file an annual Form 990 or 990 e-Postcard.
  • Maintain “active tax-exempt status” can be confirmed with the IRS with no revocation or suspension of tax-exempt status.
  • Have a “Favorable” review from a charity watchdog organization or agency.
  • Have no unresolved reports addressing “fraudulent or dishonest conduct on the Better Business Bureau site.”

On Submitting “Other Entities” For Consideration

“Other entities” that are not strictly government agencies, not-for-profits, charities, etc. have guidelines for submission, too. These include the requirement that the entity somehow serve and/or provide support for wounded warriors, family members, care givers, veterans, etc. plus:

  • The entity must be registered with the Secretary of State “in its incorporation state as a company with an ‘active’ business license and/or certificate in good standing.”
  • The entity must be recognized by or partnered with a government agency. This must be stated publicly on the government agency’s official site.
  • The entity is required to show proof of partnership with the military on the agency’s website as well as the partner site (a dot-gov or dot-mil).
  • There must be “No unresolved reports of fraudulent or dishonest conduct on the Better Business Bureau site.”

After Submitting A Resource For Consideration To NRD

Once you have submitted a suggestion for a new or updated resource, the NRD staff will vet and review those suggestions. Those which meet agency approval will be added or updated; those that do not will not appear on the site.

You may not receive a personal response letting you know the status of such suggestions; it’s best to assume that due to volume and staffing concerns personal replies may not be possible.

VA Benefits: Spouses & Dependents

When Americans join the United States military, their spouses and/or dependents are eligible for a wide range of benefits, allowances, education assistance, and more for the service member and family. The benefits available from the military are not quite the same as those offered to spouses and dependents from the Department of Veterans Affairs.

The VA focuses much of their efforts in helping spouses and dependents of military members who have died or have been seriously injured in the line of duty as a result of military service, etc. This emphasis is narrower than the DoD benefits offered to servicemembers, but the list of programs includes a range of areas that can be helpful for family members.

Qualifying spouses, surviving spouses, and dependents of veterans or currently serving military members may be eligible for one or more important VA benefits. These benefit areas will have varying requirements, application time frames, and benefit duration.

VA Life Insurance Benefits for Surviving Spouses and Dependents

Military spouses are permitted to convert “spousal coverage under Family Servicemembers’ Group Life Insurance (FSGLI)” to an individual plan of insurance with a private insurance company within 120 days of the veteran’s separation from the military. This is permitted without proof of good health.

Those named as beneficiaries of all VA life insurance programs “receive a tax-free monetary death benefit” that has no restrictions on use. Furthermore, those named as a beneficiary under SGLI, VGLI, FSGLI spousal coverage, or TSGLI programs may use the VA’s Beneficiary Financial Counseling Services and Online Will Preparation Services which provide assistance without the need of hiring legal counsel.

The Department of Veterans Affairs also offers an Accelerated Benefit Option, for those with insurance coverage under SGLI and VGLI. Accelerated benefits allows “access to up to half of the value” of the applicable insurance policy if the member has a terminal illness and is diagnosed with fewer than nine months to live.

VA Disability Compensation for Spouses And Dependents

The Department of Veterans Affairs Dependency and Indemnity Compensation (DIC) program offers monthly benefits to surviving spouses and dependents, “in recognition of the economic loss caused by a Servicemember’s death during military service, or by the death of a Veteran as a result of a service-connected disability” according to the VA.

These benefits may also be available under qualifying circumstances for the survivors of a veteran whose death is not service-connected if the veteran was VA-rated as being 100% disabled due to service-connected reasons.

VA DIC Eligibility Requirements

To qualify for VA DIC, a surviving spouse must be:

  • Married to a Servicemember who died as a result of military service
  • Married the Veteran before January 1, 1957 OR;
  • Had a child with the Veteran, AND lived together with the veteran continuously until the Veteran’s death or, if separated, was not at fault for the separation, AND is not currently remarried OR;
  • Married the Veteran within 15 years of discharge from the period of military service in which the cause-of-death disease or injury started or was aggravated OR;
  • Was married to the Veteran for at least one year

Surviving spouses who remarry on or after December 16, 2003, and on or after turning 57 years old are permitted to apply for and/or continue receiving DIC.

To qualify for VA DIC, a surviving dependent must be:

  • Not included on the surviving spouse’s DIC, AND
  • Unmarried, AND
  • Under age 18, or between the ages of 18 and 23 and attending school.

VA DIC for Qualifying Dependent Parents

There is an additional program offering compensation to surviving dependent parents of servicemembers or Veterans if the veteran’s death is judged to be service-connected. This VA compensation program is known as Parents’ DIC and is income-based.

VA Education and Training Benefits for Spouses, Dependents, and Survivors

Education benefits are available to spouses and dependents. The Department of Veterans Affairs official site states that family members caring for service-disabled veterans may qualify for career counseling and skills training. Similar opportunities may also be available for dependents of a veteran who qualify for the VA Survivors’ and Dependents’ Educational Assistance program. Opportunities for qualifying family members include the following under the VA Vocational Rehabilitation and Employment program:

  • Personalized support – Receive academic counseling, re-adjustment assistance, and more may be available depending on need, resources, space available, etc.
  • Career Assistance – helping caregivers find the best career options based on ability and interest
  • Benefits coaching – Learn how to get the most mileage out of VA benefits and other resources

You can get help with an application for these benefits via your nearest VA Regional Office.

VA Health Benefits for Family Members of Veterans

According to the VA official site, certain qualifying circumstances make the family members of Veterans eligible for health benefits. These programs may reduce the cost of health care. In some cases, certain expenses may be eliminated entirely depending on the program and its funding.

These programs include, but may not be limited to the following:

  • Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA)
  • Children of Women Vietnam Veterans (CWVV)
  • Spina Bifida (SB)
  • Foreign Medical Program (FMP)
  • Camp Lejeune Family Member Program (CLFMP)
  • Caregiver

Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA)

CHAMPVA is a health care benefit program offering coverage for qualifying spouses, and dependents.

Dependents and spouses of veterans are eligible when the veteran:

  • Has a VA-rated service-connected medical condition making them permanently and totally disabled, or;
  • Was VA-rated as permanently and totally disabled due to a service-connected condition at the time of death, or;
  • died of a service-connected medical condition, or;
  • died on active duty, and the dependents are not otherwise eligible for TRICARE benefits.

Children of Women Vietnam Veterans

This VA healthcare benefit program is an indemnity plan intended for children with certain birth defects born to women Vietnam Veterans. It offers reimbursement for medical care-related conditions associated with certain birth defects, except spina bifida which is a condition covered under a separate program (see below).

Qualifying criteria for this VA program includes:

  • Children whose biological mother is a Vietnam Veteran
  • Children conceived after the date on which the Veteran entered the Republic of Vietnam between February 28, 1961, and May 7, 1975
  • Children who have “one of the covered birth defects, as determined by the Veterans Benefits Administration” according to the VA.

VA Spina Bifida Program

VA provides benefits payment, vocational training, plus VA-financed health care benefits to “certain Korea and Vietnam Veterans’ birth children” diagnosed with spina bifida (SB). If you are the birth child of a Vietnam Veteran and have been diagnosed with spina bifida defined “as all forms or manifestations of spina bifida (except spina bifida occulta),” you may qualify.

According to the Department of Veterans Affairs, eligibility for this program requires a diagnosis of spina bifida “as the VA defines it.” This means any form of the condition except for spina bifida occulta. Speak to a physician if you are unsure whether your condition qualifies.