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I’m Kim Lankford with Kiplinger’s Personal Finance Magazine and I know that members of the military have special financial plan and need.
You could qualify for a pensioning your late 30’s or early 40’s and could receive health benefits for the rest of your life but you won’t get anything unless you stay in the military for 20 years and frankly, most people don’t stick around that long. It’s essential to do some of your own saving. Younger you are when you start setting aside money, even just a little bit each month the easier able to build a healthy nest egg. Fortunately, members of the military have access to some very valuable investing programs that are available to the general public.
Similarly, to a 401k, the Thrift Savings Plan offers a low cost, tax advantage way to save the future. You can invest $16,500.00 in a TSP in 2009, which lowers your taxable income and grows tax-deferred for the future and if you receive tax except pay while serving in a combat zone, you can invest up to $49,000.00 this year.
You can also invest up to $5,000.00 in a Roth IRA in 2009, which gives you tax-free money in retirement. If you have you have tax-exempt income form deployment, you can invest that money tax-free and withdraw the earning of that zone money tax-free too. It’s a double tax benefit that’s tough to beat.
Members of the military also have access to unique savings program that guarantees 10% interest. You can invest up to $10,000.00 in the Savings Deposit Program while deployed and the money continues to earn interest to earn interest up to three months after you returned. A much better deal than you’ll get anywhere else.
This is Kim Lankford, Personal Finance Columnist and wife of an army doctor. For more information to help military families with their personal finances, go to www.kiplinger.com/links/military.
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