For military members, many will leave the service after 2-8 years with little or no savings to show for it. Consider the following figures.
- “An increased percentage of workers report they have virtually no savings and investments. Among RCS workers providing this type of information, 27 percent say they have less than $1,000 in savings (up from 20 percent in 2009). In total, more than half of workers (54 percent) report that the total value of their household’s savings and investments, excluding the value of their primary home and any defined benefit plans, is less than $25,000.” (March 9, 2010 – EBRI.com)
- “Overall, the participation rate (in the Thrift Savings Plan) for Active Duty members was 36.9 percent in February (2009) compared to 36.3 percent in January (2009).” – (TSP Governing Board Minutes, February 2009.)
Between frequent PCS moves, deployments, and life expenses common for those in their twenties and thirties, retirement savings can seem like the last thing to think about instead of the first.
If, however, you begin to allocate just $25 a week to your Thrift Savings Plan, if you earn 8% interest, you’ll have over $13,900 in your account after 8 years of service. If you left the military, but continued to make the same savings for the next 30 years, you’d have more than $287,000!
Consider contributing a few bucks to your TSP right now. Add your raise in January for some painless investing. You’ll be glad you did!