New to the military? New to investing? Here are some suggestions to get off on the right foot:
Pay Off High-Interest Debt
Few investments pay as well as paying off credit cards or other high-interest debt. You should also take steps to improve your credit score, which can help when applying for a new job or mortgage, or when renting an apartment.
Make a Plan and Start Saving and Investing Early
The best way to attain financial security is by saving and investing over a long period of time. Because of the power of compound interest (interest calculated on the initial principal and also on interest already earned), starting as early as possible will have tremendous long-term benefits. You can use Investor.gov’s Savings Goal Calculator to see how much you need to save each month to meet your goals.
Take Advantage of the Thrift Savings Plan (TSP)
The TSP is the federal government’s version of a 401(k) plan and one of your best options for retirement savings. Contributions can be automatically deducted from your pay and provide tax advantages either today (traditional TSP account) or in the future (Roth TSP account). Sign up for TSP using MyPay. Under the Blended Retirement System, your contributions to the TSP are matched up to five percent after two years of service. That’s free money! The TSP has very low fees and the TSP website explains the benefits available to the military.