Sunday, April 29, 2012

You have an opportunity to do so much more: Part 1

You have an opportunity to do so much more: Part 1

By Keith Bunn Jr.
April 29, 2012

This morning’s posting is to my fellow service men and women out there...

Folks, there isn't a DAY that I don't kick myself for not getting more out of the time I was in the service. Don't get me wrong, I'm proud that I served, and I'm glad that I got to see and do all kinds of things all over the world, but there is one area I wish I would have done better on & that's in the financial area.
As some of you may or may not know, I was in and out of the Army for a total of 8 years and I've served as both married & non-married in my active duty days and I will break down my financial "regrets" in both those areas separately in a two part blog series.

Part 1: Non-married soldiers

This is where I have my biggest regrets, because as a single soldier living in the barracks, I really did have it made! I know you may not think so right now but you do. You have a roof over your head, a bed to sleep in, three meals a day provided in the Mess Hall, all your medical, dental, and vision care provided, as well as all utilities provided. All that is FREE!!  A lot of people out in the civilian world don't have that. I understand that this varies for you from time to time, depending on if you're in the field training or somewhere in the world on combat duty, but you have an opportunity that most of us out here in the civilian world and some of the married service men and women don't have, and that is, you can bank and/or invest just about your whole paychecks. You don't have to buy a brand new car with a payment attached to it, you don't need to party your tails off each and every free night you have, and you don't need to buy all kinds of crap that you just have to pack up anyway every time you get deployed somewhere.
Now I did some checking on  and the base pay for an E-1/Private coming into the military is $1,491 per month. If you just took $400 per month, every month and invested that in good Growth Stock Mutual Funds for just a three year tour of duty, which would be $16,852. That still leaves you with $1,091 a month to live on. Or you could invest $1000 each month for three years, which would be $42,130! In either case, you still have money left over to buy other items you need to live every day.
Now here’s the thing, experts that are way smarter than me have said that if you are to be a true investor of your hard earned money, you should leave it alone for five years or longer to get the full benefit of the investment. So let’s say after the three year tour was up and you stopped putting money into that investment and never touched it until you were 65 years old. For the $400, that would be worth just over $1.3 million and for the $1000 that would be worth just over $3.3 million. Now here’s the kicker… These numbers are for an E-1for 3 years. You’re not going to stay an E-1 that whole time unless you‘re just a loser and even then, you should make at least E-3. And what if you were like a friend of mine who made it to E-9 and retired with over 20 years under his belt. Those numbers would be significantly higher plus receive your military retirement! These are the things no one told me when I was in the military but now wish someone did.
I would very much like to hear the input of the retired and/or active duty soldiers out there about what I’ve posted here today. Also, if you’d like to run your own numbers of what you’d like to invest and where you’d like to be at retirement, I have put a link to the investment calculator I used below.

As with all my blog and social media posts, I welcome any comments and feedback on the topics I write about. It is the only way you and I will learn more about ourselves and each other, so ask away! Part 2 coming soon!

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