Serving in the military doesn’t afford much free time, which can make it tough to research and choose the best investments. Here are three of the best investments for military members provided by Rani Jarkas.
- Federal Thrift Savings Plan
The Thrift Savings Plan (TSP) is a qualified retirement plan that provides a low-cost, tax-advantaged way for federal employees and service members to invest. You can select your own mix of investments, from a short-term U.S. Treasury bond to index funds to a life-cycle fund, the last of which automatically rebalances your assets as you near retirement.
- Savings Deposit Program
The U.S. Department of Defense’s Savings Deposit Program (SDP) gives deployed military personnel serving in designated combat zones a guaranteed 10% annual return on deposited amounts of up to $10,000. To qualify, you must be receiving Hostile Fire Pay and be deployed for either 30 consecutive days or at least one day per month for three consecutive months. You continue to earn 10% interest for 90 days after you redeploy home, unless you request to withdraw your money sooner.
- Real Estate
Real estate can be an excellent way to diversify and achieve higher returns. The tradeoff is that it involves more risk (and effort) than lower-risk investments. Still, real estate investments offer numerous advantages, including tax benefits and ongoing passive income. A common way to invest in real estate is to buy a house and convert it into a rental property (some service members buy property near their bases to make managing the rentals easier).
Service members also have access to programs that, while not investments, can save you money. For example, the VA Home Loan program offers mortgages with no down payment, low interest rates, limited closing costs, and no need for private mortgage insurance (PMI).
You can trust the integrity of Rani Jarkas’ balanced, independent financial advice, who is a highly experienced and accomplished financial services executive, with over 23 years of international banking experience with Cedrus Investments.