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MD from Military Dollar could literally stop contributing to her retirement accounts today. She’s cruisin. (insert 60’s beach theme music here).
She is especially gifted at spreading all of the personal finance perks to serving in the armed forces (of which there are tons by the way). We were absolutely thrilled to speak with her for this episode 🙂
We chat about:
- money tips for service members (and non-military folks as well)
- The rule of 72
- What is your “cruising” number/rate?
- The crazy good FI perks from a career in the military
There are probably way too many service members not taking advantage of some of the plans MD drops in this episode. Let’s change that! If you or someone you know is serving, tell em. It could literally change their life.
This talk was seriously fun. Enjoy it, and feel free to drop us a comment if you’d like 🙂
Show notes and links from today’s episode
- MD’s blog – Military Dollar
- Mr. Money Mustache
- Get Rich Slowly from J.D. Roth
- Dave Ramsey debt snowball PDF
- MilitaryFIRE FB Group
- ChooseFI Feds
- Tax considerations in a combat zone – Super interesting post
- My Favorite Little Known Military Benefit: The Savings Deposit Program – This is incredible.
- The FIRE Drill private Facebook group
Key takeaways from our chat with Military Dollar
1 – The rule of 72.
For the full context, you’re probably going to need to listen to the episode (specifically how MD explains it), but here’s the rule in a nutshell:
- Take the number 72
- Divide it by the interest rate (the percentage at which your money is growing, that is)
- That’s the number of years it takes to double your money.
For example, if you’re money all of your savings account average about 4.5% per year, it’ll take roughly 16 years to double your money.
So if you’re aiming for $1.5M to retire at age 60, and you’re sitting on $750k….you’re at the *coasting* level if you’re at age 44.
The only problem: those finicky interest rates. Them suckas can change (duh. 2008 anyone?)
It’s important not to rely on this rule for anything, but it can be useful to get a quick estimate of where you’re at on the path to FI.
2 – If you’re stationed overseas, all your pay is tax-free.
Not so much a takeaway really, but this is a really sweet benefit to serving in the military. And actually, between these random perks and the armed forces only savings programs, there seem to be a plethora of personal finance benefits from a career in the armed forces.
Including that sweet guaranteed 10% return savings account (seriously, this is sick).
(technically, you do need to be in a combat zone, as well as few other limitations.)
3 – Know your situation
We didn’t specifically talk about this in the episode, but this is a crucial point for every single person reading this…
Know your situation.
MD dropped several amazing perks many service members don’t take advantage of. Even if you’re not in the military, what are you in?
At a corporation? What perks might you not be taking advantage of? And not just retirement accounts either. Loads of companies offer random perks ranging from discounted laptops to free or discounted cell phones, to who knows what else.
The important thing is to know.
Questions? Like or dislike? Leave us a comment!
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