Crystal Farris/Idaho Military Division Public Affairs
Capt. Ashley Thropp, who serves as a behavioral health officer for the Idaho Army National Guard and a clinical social worker for the U.S. Department of Veterans Affairs, always knew how to earn money, budget and save.
She joined the military when she was 17, always lived below her means and ate bean and cheese burritos while earning her undergraduate degree because they were cheap and easy.
Although she still lives below her means now, it was only after having her son two years ago, that Thropp realized she didn’t understand the first thing about investing.
At that time, Thropp decided to meet with one of the Idaho National Guard’s financial counselors to learn ways to invest her money, set herself up for a better retirement and plan for her son’s future.
“I just had my son and was working from home at the time,” said Thropp. “My unit had put out information about free financial counseling and I wondered if the counselors could answer some questions about how my family could make better financial choices for our future.”
Financial counseling services
The Idaho National Guard’s financial counselors help with tax assistance, offer support and counseling opportunities for credit management and provide training in money management, budgeting and home buying. They also help service members in reaching long term goals, such as emergency savings, education, buying a house and retirement.
“Just like we need to see a medical professional for our annual check-ups, it’s a good idea to see a financial professional to ensure a financial fit future,” said Jennifer Wood, a personal finance counselor with the Idaho National Guard.
Statistically, Wood said financial issues are reported in the top three areas where service members struggle the most. Since a service member’s financial problems affect their military readiness, the Idaho National Guard provides free financial counseling and services through Accredited Financial Counselors, like Wood, who are available to all branches of the military, their family members, Gold Star families and veterans within 180 days of transitioning out of the military.
Initial financial appointments take approximately an hour and can be conducted in person, over the phone or by video conference. During that time, a financial counselor will get to know a person’s financial situation, gather information and develop a plan forward.
“Together we identify where they are and where they want to be financially in the future,” said Wood. “Setting future financial goals gives the client somewhere to allocate money. The goals are identified, labeled and achieved by monthly allocations.”
Making a return on her investment
During Thropp’s visit with the financial counselor, she said they discussed the five basic TSP funds, the Lifecycle funds and how Thropp felt about investment risk.
“The financial counselor talked me through each of the different TSP funds, how they work and about risk tolerance,” said Thropp. “I learned how choosing a different fund could mean I take more risk with my investment, but the gain is significantly better. She also helped me come up with some investment percentages that I was comfortable with and that made sense to me.”
After her meeting with the financial counselor, Thropp chose to move her TSP funds from the G fund to more aggressive C and S options. Thropp said she is pleased that her retirement investment grew after only several months.
The Thrift Savings Plan is the federal government’s sponsored retirement plan for employees, which all military service members are eligible for. Although she has been contributing 15 percent of her Guard earnings since 2005, Thropp never accessed or managed her money in the TSP and was therefore defaulted to the G option, which Wood describes as a glorified savings account.
“I didn’t understand risk tolerance and investing before meeting with the financial counselor,” said Thropp. “I didn’t understand the G fund only grew by very small percentages, compared to the C and S funds, which move with the market and have already grown significantly since I made the switch. I just wish I would have known about the benefits of contributing to different funds earlier.”
In addition to TSP investment opportunities, Thropp learned the importance of other investments, standalone mutual funds and investing in her children’s education through a 529 Education Account. The 529 account is an education investment account, offered in every state, that within Idaho also offers a state tax advantage.
Wood said the money in a 529 accrues much of the same way the TSP does, except it can only be used toward all qualified education expenses, including K-12 schooling and expenses such as tuition, books and school supplies.
“I learned that the 529 plan moves with the market and grows more over the years than it would through a savings account,” said Thropp. “The financial counselor showed me a graph of how the market has grown over the last hundred-year period. I opened mine last year, contributing $50 a paycheck in the market investment. So far, I’ve invested $1,750 of my own money and it’s already at $2,600.”
While different TSP options and a 529 were the best fit for Thropp, financial counselors are able to provide information and options to service members and their families based on individual needs.
All investments have risk, Wood said, and the amount of risk one is willing to take is the amount of return an investor should expect to see.
“Not everyone is in a position for a high-risk, high-reward investment,” said Wood. “That is why I recommend investing in mutual funds vs. stock instruments for beginning investors. I realize block chain currency, like Bitcoin, is a flashy and exciting way to invest, but it is also risky. I’ve seen service members who live paycheck to paycheck invest in cryptocurrency hoping to make a windfall return, only to lose money in the end. Investing slow and steady is the best way to gain wealth.”
For Thropp, she said her goal was to contribute as much as possible now toward her retirement, while she is still young and able to afford taking higher risks with her investments.
Grateful for Guard benefits
“In past years, I think I may have taken for granted the services and benefits we are offered as Guardsmen, like the free financial counseling,” said Thropp. “I can easily call or set up a video chat with a financial counselor. Other people don’t have that and when I look at it from that perspective, I realize how amazing it is to have these benefits at my fingertips and I try to share that knowledge with others.”
Thropp said she encourages other Guardsmen to invest in their TSPs and meet with a financial counselor about their retirement and investment opportunities to help prepare them for their futures.
“I pass that information on because I wish I would have known it myself early on,” said Thropp. “The Guard has so many opportunities and benefits available to us, if we only take advantage of it. I’m very grateful for the Guard and what it has provided me over the years to grow and improve my life both personally and professionally.”
Beside financial services, the Idaho National Guard’s Service Member and Family Support program also offers referral resources for crisis intervention, legal resources, TRICARE resources, emergency family assistance, community information and outreach and financial services.
Visit https://www.imd.idaho.gov/personal-finance-counseling/ and https://www.imd.idaho.gov/idaho-national-guard/family-programs/ for more information.