military financial advisor

How to Find the Right Military Financial Advisor

How to Find a Good Financial Advisor [for Military Families]

Everyone knows that managing and saving your money is important, but it can be very confusing to know which options are best. Money matters are even more complicated for active duty military and veterans, and that’s why it’s essential to get direction from a trained financial advisor for military families when planning for life and retirement. Not all financial advice is created equal, and military families have especially unique needs. I’d love to offer you some tips and wisdom so you can feel prepared as you plan for your financial present and future!

What Is a Military Financial Advisor?

When you need advice for your financial planning, you need someone who understands your specific lifestyle. Military life comes with its own expectations, and it’s own systems for pay and benefits. If you’re a parent, you’re also concerned about planning effectively for retirement and ensuring your kids are well taken care of. A military financial advisor knows all the same military acronyms you do, understands the military life, and provides the added service of making sure you’re exploiting all possible benefits to your advantage. He/she will make sure that you don’t miss out on opportunities offered to you because of your service, and that you don’t choose investment options that will compromise your military benefits.

Types of Financial Advisors

Financial advisor is a large, umbrella term that can describe different types of people who help you determine your next financial move. They’re not all the same, and it’s important to know who can help you, and how.

Fiduciaries

Fiduciaries are openly vested in the best interest of their clients. They act on your behalf, and seek out the ways to protect and serve you and your finances. They are legally held accountable to get you most beneficial services. This is a quality you want to look for! Many types of advisors can claim to offer helpful advice, but fiduciaries are bound by law to act in your best interest, no matter what.

Fee-Only vs Fee-Based Advisors

Like any industry, financial advisors need to be paid for their expertise. There are two ways for this to happen. Fee-only advisors are paid a flat fee for the service they provide to you. Fee-based advisors may also earn a commission on products they sell you. It’s a great idea to look for fee-only advisors, since they won’t feel any additional incentive to offer you products that you won’t need.

Brokers (Work Off Commission)

Brokers are middle men who look for the ways to make you the most money, since they earn a commission. At the end of the day, they are acting in their own best interests – which may often still align with yours – but they’re not legally bound to choose the best scenario for you like fiduciaries are. They can serve a purpose, but proceed with plenty of caution, especially if you haven’t done a lot of research for yourself.

Why Do Military Families Need Financial Advisors?

You may be wondering, “Should I get a financial advisor?” Maybe it would be just as simple (and cheaper) to just learn the programs and services that are offered for yourself? To put it bluntly, like so many things in life, hiring a professional is usually the right move. Military financial counseling can help you know for sure that you’re planning correctly. 

A great military financial counselor will understand the ins and outs of the specific programs and benefits you can access, and he/she has extensive education in how to most effectively plan. You could do the work yourself, but it would be a considerable investment of time, effort, and money. Find someone who has the experience and can inspire confidence.

What to Look for When Choosing a Military Finance Advisor

Once you’re ready to move forward, it’s a matter of where to look and whom to trust. Make sure you take the time to ask as many questions as you need before partnering with any advisor.

1. Military-Specific Experience

Look for a military financial advisor with both active duty and retired military clients. This ensures that he/she understands the full picture of military life, from enlistment to retirement, and has the education to help you make the right decisions. Ask for references if possible. I highly recommend Jason Meyer from Northwestern Mutual. Jason is an Army Veteran who understand exactly what military clients need from his own personal experience in  the military. 

2. A Deep Understanding of Military Pay and Tax Allowances

Service members are offered different benefits from civilians, and it’s critical that your financial advisor understands exactly how they work. Recommending products or services that are great for civilians can actually backfire for military clients, since they’re offered an entirely separate slate of options. If you’re feeling like you need to explain things to your advisor, it’s probably not a good fit.

3. Familiarity with Military Retirement & All That Involves

The end goal of great financial planning is to ensure that individuals and families are supported through their working life, and then set up with an appropriate safety net during retirement. A good military financial advisor should be well versed in financial planning for veterans.

4. Knowledgeable of the DoD’s Savings Deposit Program

One additional military benefit is the DoD’s Savings Deposit Program, which allows members of the armed services in combat zones to earn a competitive interest rate on funds they invest. This is a critical benefit that can be optimized, and a great military financial advisor will know exactly how to do it!

Where to Look

Be wary of personal “oh here’s my guy,” referrals; instead, be very specific about looking for a military financial advisor. Asking other service members is a great place to start. There are also ways to find internet based advisors looking to accept new clients, including the Military Financial Advisors Association. The AAFMAA also offers financial planning services. Finally, Military OneSource offers resources as well.

Frequently Asked Questions

How much should I expect to pay a financial advisor?

The cost of a financial advisor will vary depending on whether he/she offers a fee-only structure, a commission structure, or something between the two. Though rates can vary greatly, expect to pay a fixed fee between $1000 – $3000 for services. Do make sure that the fee structure is very clear before you begin a partnership with a financial advisor.

What's the difference between a CFP and financial advisor?

“Financial advisor” is a broad term that can encompass any number of positions. CFP stands for Certified Financial Planner, and is more specific. A CFP has received a certification from an independent board. It can be helpful to know that your advisor has received this formal training.

Does the VA offer financial counseling?

The VA does offer some financial counseling in particular circumstances, such as to TSGLI recipients. If this situation applies to you, this could be a great place to start.

Finding the right financial advisor for military families can be overwhelming at first, but I hope these tips make that easier for you!

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