At Precise Financial Planning in Las Vegas, 30% of planner Audry Batiste's clientele are military personnel, mostly at Nellis Air Force Base, a few miles away.
You practice what you know, reasons Batiste, the firm's founder and president.
And Batiste knows the military firsthand - he joined the Air Force as an enlisted member and retired as an officer. Now he focuses on helping military families balance financial priorities with life and career planning.
"I take the approach that financial fitness is important for service members and their families, and identify it as a major factor in their overall military readiness," Batiste says.
There are a number of financial planners who make a specialty of counseling military personnel. Like Batiste, most are former service members who see their work as a calling - they deeply want to help others who may be less savvy. They understand the stress that can plague those who are ready to stand in harm's way, and want to help to ease their burdens.
For Randy Gantt, a financial advisor with Artifex Financial in Oakwood, Ohio, "Ninety percent of my clients are either in the military or civilian employees of the government, which is where most of the military retire to after leaving the service."
The client roster of Ana Torres, a financial advisor at First Command Financial Services in Fairfax, Va., is also weighted heavily with service people.
"Over 95% of my practice is still serving, with the bulk of the rest being military retired," she says. "I am in a military family myself. My husband and I are majors in the Army Reserves and National Guard, respectively."
Planners who specialize in serving such clients must be knowledgeable about the distinctive benefit programs that the military offers, and they tend to use the language of military training in selling their services.
"They're taught mission first - mission readiness - so I tell them they also have to think about financial readiness," explains Steve Repak, principal at Repak Financial Services in Charlotte, N.C.
"Deployment will be that much more stressful if they're worried about money - food, car payments - so get the finances taken care of first," he says.
Among the details that these planners must master are the Uniformed Services Thrift Savings Plan, comparable to civilian 401(k) plans; advice on starting second careers upon separation or retirement; and education benefits and college saving options for members and their dependents.
"I make the proper structuring and integrating of these benefits into their financial planning a requisite," Batiste says.
From experience, he knows that many investment choices pitched to military members carry high fees, commissions and surrender charges. Batiste notes that he has met service members who have been advised not to contribute to the Thrift Savings Plan and have instead plowed their savings into investment products with very high commissions.
While on active duty, Batiste says, "I'd often discuss my comrade's investment portfolios or the lack thereof and motivated many on a path to financial freedom. After helping several colleagues attain financial stability, I decided to follow my passion."
At Artifex, which is a part of the Alliance of Cambridge Advisors, Gantt takes advantage of his experience: 15 years in the National Guard and approaching two years in the Air Force Reserves. "It's easier for me to speak with military people - I understand the compensation, the benefits and the pension," he says. "I can say, 'I know what your paycheck looks like.'"
When he speaks to younger soldiers, Gantt highlights the benefits a military career offers. "When they put in their 20 satisfactory years, they'll be entitled - as will their spouses - to health care for the rest of their lives," he says.
But newly enlisted members are not as assured that they will get this benefit, Gantt notes. "They realize that the government cannot continue to pay this huge pension and free health care."
Many soldiers and airmen are young, and some are quite unsophisticated, observes Repak, the advisor in Charlotte. "I served, and I know that most were like me - we don't come from a money background," he says.
At one speaking engagement, for instance, he encountered a service member who thought that, as long as he had checks in his checkbook, he had money in his checking account.
Repak, who spent 12 years in the Army, says he "racked up $32,000 in credit card debt because part of the coping mechanism after a deployment like Afghanistan is to spend money as a stress release."
He knows from experience that invoking the military's culture of sacrifice and accountability works well with service clients.
"We discuss basic emergency funds, and I introduce a spending plan or journal where the client records what they spend, saving receipts," he says. "They have no idea until they see that they've been spending so much on video games or in the transportation category, for example."
Repak tells them, "Pay yourself first and set up an allotment to put X amount into a short-term savings plan." He extols the Thrift Savings Plan, which has very low management fees - "only 22 basis points."
One fund available within the Thrift Savings Plan is the G Fund, short for the Government Securities Investment Fund, which consists of very short-term loans to the U.S. government and has a record of beating inflation despite exceedingly low management fees - just 2.5 basis points.
Artifex's Gantt, too, zeroes-in on making sure that clients take advantage of military-provided benefits: "Tricare health insurance; Servicemen's Group Life Insurance, for which they pay $29 a month for $400,000 of coverage."
Gantt started as an enlisted man and was later commissioned, and he feels comfortable advising service members of all ranks. "I have a good perspective from both an enlisted and now an officer's point of view," he says.
"For the younger enlisted folks, I talk about budgeting and family planning. Money's not all that plentiful, and so I talk about taking advantage of the Thrift Savings Plan and the GI Bill. We start thinking about housing and health care," Gantt adds.
When he speaks to senior leaders, the conversation centers on how to supplement retirement funds. "Most will either get a government position afterward or civilian jobs," he says. "They worry about supplementing the pension - 'Can I find a job right away?'"
With National Guard members and reservists, whose retirement health care coverage and pensions are not available until they reach 60 years old, Gantt talks about the possibility of having to come up with $15,000 to $20,000 a year for health care costs for 10 years or more. He also guides them in making use of a 401(k) or orther retirement plan through their civilian job.
"It's a rewarding field," he says. "I work almost exclusively through word-of-mouth referrals in military circles. There's a need there." He sees the military as an "underserved population."
The specialized guidance that Gantt offers military clients includes how to effectively use the Post-Sept.11 GI Bill.
The bill has a transferability option that allows a service member to pass along 36 months of unused college benefits to a spouse or dependent children.
"This is so important," Gantt says. "I had a client who told me that he and his wife had been scraping by to save money in a 529 plan for their children's education when they didn't need to."
One benefit of a military career that enlisted personnel often need counseling help with is the $30,000 Career Status Bonus, offered at the 15th year of service for any enlisted member who entered the service on or after Aug. 1, 1986.
While the payout is labeled a bonus, there are distinct drawbacks for those who choose to accept it. "This bonus reduces your pension," Batiste explains. "The problem is that the $30,000 is often used to satisfy instant gratification - a major purchase like a car - or to pay down debt, so I evaluate the option with my clients."
He helps them consider investing the money. "What is its true value versus not having a reduced pension? I haven't seen any cases in which it would be a positive," he says.
"Once we go over the specifics and look for a breakeven point, the client realizes that he or she doesn't want to take the bonus after all."
A TRANSITORY LIFE
There's also a home assistance program that takes effect when service members are reassigned. "It allows you to sell your home and not be subject to the loss of value," Batiste says.
Chip Simon, president at Taconic Advisors in Poughkeepsie, N.Y., notes that there are a number of unusual elements in advising military personnel.
"Military life is transitory, moving from base to base - you may buy real estate and then have to rent it. What about tax planning? If you're deployed to a combat zone, your income is not taxable. Does a Roth conversion make sense as a low-tax source?" he asks.
Simon specializes in military-to-civilian coaching. "Replicating the lifestyle you became accustomed to after 15 or 16 years in the military can be a challenge," he says. "What will you do when your 20 years are up?"
"Economic uncertainty remains a critical issue for many service members and their families," adds J. Scott Spiker, CEO of First Command Financial Services, which started in the 1950s when Air Force Lt. Col. Carroll Payne witnessed the financial troubles experienced by survivors of crew members killed in an aircraft accident.
"Military families, when living through high-operations tempo, have frequent and lengthy family separations, and the attendant stresses of war," he notes.
"Financial planning for military families has to help them cope with these unique challenges," Spiker adds, "especially to develop habits leading to long-term financial goals with security."
Janice Fioravante, a New York writer, has contributed to Institutional Investor and The New York Times.
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