1. Financial Management
Element 42
PG. 202

2. FINANCIAL MANAGEMENT
Develop and produce a 12-month post-separation budget – CRS
Compare your benefits to what is available in the civilian sector, including but not limited to:
Paid leave / holidays
Bonuses
Tax-free portions of pay
Pension plans
Health care/ Retirement health care plans / Counseling
Gym memberships / Theaters / Recreation programs
Commissary and Exchange
Life Insurance
Education Programs
Legal Services
A family’s/service Member’s financial security should be considered before the decision to separate or retire is made
It is important to have your financial affairs in order BEFORE leaving the military
Unless you have a career lined up, it could take some time to find a job
Develop and produce a 12-month post-separation budget, (CRS)
completed with a qualified Command Financial Specialist (CFS) or FFSC Counselor
Can also use Military Onesource
Criteria for the budget will be provided during the “Financial Planning for Transition” module, but you will not leave the class with a complete budget
After transition, you will pay for many of the free/low cost services you access on the instillation while on active duty.
Element 42
PG. 202

3. Thrift Savings Plan (TSP)
Optional Retirement/Savings plan similar to 401(k)
What to do with your TSP when you transition
Under $200 – TSP will send a check for the amount in the account
Partial or full withdrawal
Before April 1 the year following the year you become 70 ½ or the year following the year separated from the federal service/uniformed services
TSP is a retirement/savings plan similar to a 401(k)
Optional
Withdrawl at end of service
Partial is over $1000 and can be made only once
Full withdrawl
Single
Lump sum
Series of monthly payments/TSP life annuity pays benefit every month for life
Must withdrawl before 1APR of the later of the following year they become 70 ½ or the year following the year separated from the federal service or uniform service
If they do not withdraw or begin withdrawing their account by the required deadline, the account balance will be forfeited to the TSP.
They can reclaim their account; however, they will not receive earnings on the account from the time the account was forfeited.
Element 42
PG. 202

4. Blended Retirement System (BRS)
Employer contribution match up to 5%, 1% automatically
Calculating Retainer pay (40-65%)
Continuation Pay – paid at 12 years of service for 4 additional years
Lump Sum
Automatically enrolled for 1% automatic contribution match with service member giving 3%
Employee contributions automatically go to the age appropriate lifecycle fund
After 2 years of service, they will match up to an additional 4%
Continuation Pay - A one-time, midcareer bonus in exchange for an agreement to perform additional obligated service of 4 years
Lump sum – An option to receive a discounted portion of your monthly retired pay as a lump sum distribution at retirement
25% or 50% at retirement
Element 42
PG. 202

5. Survivor Benefit Plan (SBP)
Specifically for retirees
Life Insurance for your Retired pay
Optional insurance plans
At the time of retirement, you MUST decide if you wish to keep this coverage
Failure to accept or decline coverage will result in your being automatically covered at the full coverage
Your spouse will be required to sign the SBP Election Form and should be included in the decision making process.
Specifically for retirees
Life insurance for retired pay
If a military retiree dies, their retirement pay stops.
Pays spouse an annuity to help make up for the loss of the retirement income
All active duty military members are automatically covered under SBP at the full amount (while on active duty)
Encouraged to search for optional plans Optional insurance plans
At the time of retirement, you MUST decide if you wish to keep this coverage
Failure to accept or decline coverage will result in your being automatically covered at the full
Your spouse will be required to sign the SBP Election Form and should be included in the decision making process.
Element 42
PG. 202

6. Resources
Regular Military Compensation Calculator:
TSP:
BRS Info:
SBP:
Fleet and Family Support Center San Diego Metric Area
Command Financial Counselors
Element 42
PG. 202

7. Questions
What is REQUIRED to be completed to meet Career Readiness Standards?
What does TSP Stand for?
How much does your military employer automatically contribute to your TSP account?
When can you apply for Continuation Pay under the BRS system?
SBP is also considered what?
Element 42
PG. 202