Empowering Troops for Financial Transition Webinar Transcript
Wednesday, April 20, 2016
Pinckney: Good afternoon and welcome to today’s discussion on military families transitioning and the financial aspects [that entails]. I am Belinda Pinckney, your moderator for today’s discussion.
We’re very fortunate to have a great panel today to have this discussion for you. We have all sat in your seat -- we wore the uniform, we wore it proudly. And we were very anxious, we had of fear of the unknown, as we made this decision [to transition] as well. So without further ado, I’d like for the panel members to introduce themselves as well.
Carter: Hi, I’m Phil Carter, I’m an Army officer and Iraq veteran, and now I lead research at the Center for New American Security, focused on veterans issues.
Pinckney: Thank you, Phil.
Greentree: Hi, I’m Vivian. I’m an SVP at First Data where I head up our military and veterans affairs, encompassing our employment programming, our experience initiatives and our entrepreneurship initiatives. I’m a Navy veteran and a proud Navy spouse.
Pinckney: Thank you, Vivian.
Runnion: Hi I’m Lewis Runnion, Senior Vice President of Public Policy at Bank of America. I work on our Military Affairs initiatives and help lead many of the programs that the Bank sponsors around military including our hiring programs, which we hired nearly 9,000 veterans since 2010 with a goal of hiring another 10,000 over the next few years. [That supplements] a lot of the other philanthropy investments which we make into the veteran community. And we at the Bank believe that it’s not just a good thing to do, it’s a smart business decision for us and so we have seen our culture change in a very positive way by adding these many veterans to our team. Were delighted to be here and co-host, co-sponsor this today with Military Times.
Pinckney: Thank you. So we’re going to get right into the questions. There is this hurdle that we talk about for military families transitioning. They need to consider several factors from a financial perspective and I know, Phillip, that you do a lot of research in this area. But if you could just think about some of the things that either you’ve experienced -- through your research or [as] you talk to people -- those hurdles that almost every military person has as they decide to go through.
Carter: Sure, I usually boil it down to two things: uncertainty and complexity. There’s uncertainty in the sense that you don’t have the assurance of a paycheck every 1st and 15th of the month the way that you did while you were in the military. Firms close, paychecks are delayed, and things happen in the private sector, it’s very uncertain. The second -- so for a civilian job, you don’t have all the decisions made for you about retirement and health care and uniforms. All of a sudden, you’re given a summary of benefits, that say choose a health plan or retirement plan that suits you. And you have to choose from all these options and make smart decisions that are going to affect your family and your own bottom line for years to come. So those choices are ones that are very vexing for folks that come out of the military.
Pinckney: Right, great points. Thank you. Vivian?
Greentree: I mean it costs money to retire. It costs money to transition out whether you’re at five years or 20 Years because there are these, these costs of living that you haven’t had when you’re in the military. You know there’s tax exemptions that we have while we’re on active duty, there’s family separation pay, there’s flight pay, housing allowance. And so those are things to factor in when you are looking for a job, in the benefits summary. Health care is huge because not only are your health care costs going to go up most likely, but you’re also going to have to be making a lot of decisions in a short amount of time that are going to affect your for a long time to come. And so those are just some of what military families are thinking of when they’re transitioning, but I think we’d all like if they were thinking of a little bit more, a lot more to the left of transition. Because things happen - you could be expecting a 10 to 20 year retirement, sequestration, a drawdown of troops. Your spouse might get tired of you deploying and wants you to be home more often.
Pinckney: That’s a family decision.
Greentree: That’s a family decision. So the more that you can preplan for these financial considerations the better off you’ll be when you get to that point.
Pinckney: Thank you.
Runnion: So each of you hit on very good points and we look at the statistics of the audience viewing today and about 33% of you who chose to respond are going to get out within the next year and I ask you to think about yourself: what have you done to plan for that transition because it’s not a single step, right? It’s not: let me, let me go through my retirement process, go through tax classes and get out. It’s multi-faceted and it starts with what is that career that I have done. How does it parlay into this civilian community. And then secondly, our research and experience has shown us that financial stability is a key component to that successful transition, which doesn’t take a single year or month, it takes some time to do that and to leverage the resources that you have that are available in the community whether they’re programs like Bank of America has developed with Better Money Habits -- specifically focused towards military service members making a transition or some of our philanthropic partners such as a Reboot organization in California whose developed a specific transition program for veterans. So there’s many tools readily available for you. Some we’ve created, some other organizations have as well. Use those to help through your transition. Don’t wake up the morning after you transition and go “well you know, I’ll start to plan now.” You’re already too late if you do that.
Pinckney: Right. So we’ve talked about some of the hurdles associated, especially from a financial management or financial implications perspective. So now why don’t we try to work on some of these resolutions to some of those challenges? And I want to talk to you first, Phil, about that because you’ve done a lot of research in this area, so if you want to talk about some of the other findings with financial implications and then of some of the solutions to those [challenges], I’d love to hear those comments from you.
Phil: Yeah, sure. So a few things: focused on the employment space, the point of our preparations are a really good one. You build that network ahead of time, and you build your LinkedIn profile and resume ahead of time. You begin the job search three to six months before you get out. Because it takes a while to find the right fit and also recognize that that first job is likely not going to be the job you keep for very long. More than half of veterans leave their first job within a year. It takes a while to find your footing in the civilian market. The second thing I think is understanding all the benefits that are out there. Surveys have shown that veterans don’t understand the full range from the private sector, from the public sector. There are things available like the VA Home Loan guarantees, or other things at the state level that you should really take advantage of if you can because those can help ease the transition. And then the third thing that can be really really important is to leverage all the folks who have gone in your footsteps before. You know there is this huge mentor network out there of the veteran’s community -- 22 million veterans in America. They’ve been in your shoes, or your boots, or your flip-flops, whatever, and they can likely help you down the road and they probably want to because this is one way they can continue to give back.
Pinckney: Right, that LinkedIn aspect of it now… Do you have any research that talks about the number, say the military people that even focus on LinkedIn alone, the veterans, and whether or not that they are really using that as a tool? I say that because I found it’s very helpful. Before I got out, I didn’t even think about using LinkedIn that much because I didn’t see any value in it. So I’m thinking if there is research that speaks to that or just some experience would you like to share?
Phil: There’s a lot of research that talks about the network effect and how it helps people in a hiring. That referrals or friends and friends tend to help people get over that initial hurdle, that can be incredibly important for small employers where the majority of Americans work and where they’re not able to leverage a massive human resources department to do due diligence, what they want is a friend’s recommendations. LinkedIn is great.
Pinckney: They are using LinkedIn. I’m glad you said that…
Greentree: We use LinkedIn.
Pinckney: Because I think a lot of people don’t know that the employees do and find use LinkedIn. And other social media, I guess for …
Greentree: That’s very important for the public sector because it allows us to reduce the cost of searching for human capital. We definitely, our Military team uses LinkedIn all the time when we have referrals from our military affinity group members, people on our military veterans affairs team, that’s very helpful.
Runnion: I would say, through your network, identify whose been the most successful in transition and ask her or him, how they did it, what made them successful, what those challenges were, and try and model your transition after someone else who’s been successful in the process. Maybe that’s not just one, that’s many.
Greentree: Well you know, and ask them, you might trust them the most to say, and about the financial part of how long it took them to find a job we know that, I think about eight from 10 leave service without having a job. So they probably took charge of their finances early on, paid down debt, had cash savings, thought about retirement plan, or had that cushion for the ability to look for the job that they wanted. I think that would have definitely played into the success that they had to be able to feel comfortable during that process, not to have jumped into the first thing they saw.
Pinckney: Did you have any other comments on that?
Phil: No. Those were great.
Runnion: I’ll give you a quick real life story of, maybe six weeks ago, I was visiting with a well-known university on the West Coast, who had a specific MBA program for veterans. And a very bright young man, a veteran, asked me a good question, he graduated from a great school, he was getting his MBA from another school, and he had been successful in the militaries. He sent out 150 resumes and nobody has responded to him yet. So he’s sending those out via email, and they’re going into whether they’re your (Vivian’s) system or my system, and companies have filters, so they get filtered out in there somewhere. The discussion was: what you have done to set yourself apart from everybody else that is sending those resumes in. You can see the light come on. That’s what I would encourage this audience to do is, how do I differentiate myself from others? And it’s not just putting your picture on top of your resume or any of those things, but find out who is at that organization that you know, or the connections you have and the network that can set yourself apart, so when you come to me, you’re not a stranger. Right, I know that name when it comes to me to review for possible candidacy.
Pinckney: When you’re looking at the different levels of people that are exiting, would you tend to to think that if you’re a more senior person or middle career, you’re more used to the networking, and you know, especially as a senior executive, getting out -- my experience has been you know more about the fact that often times you get a job because you know someone who introduced you to it. But a lot of people are getting out and they don’t know a lot of people. So how do they navigate this role of finding a job?
Carter: So there’s a rule of thumb that the longer you stay in the harder it’s going to be to get out. You might be really well qualified person, you know the best the best officer, the best, in the service, but you’ve lived in this very insular world where you might not have the connections to First Data or Bank of America or the research community that can help you get that job on the outside. You become a prisoner of the civil divide. And so it’s really important to look for those people that can be your connectors and reach out. And I also recognize that it’s a transition and just because you managed 5,000 people in active duty doesn’t mean you can walk into a private sector company [and do the same].
Pinckney: That’s exactly right.
Phillip: And do the same. You know there might be a change there. You’ve got phenomenal leadership and management ability is no doubt, but it is different in the private sector.
Pinckney: It sure is.
Greentree: It’s especially relevant to this discussion for military spouses. Because as much as it’s hard for veterans to transition, they have that resume behind them. And a lot of military spouses don’t because they are underemployed or unemployed because of PCS moves and other requirements of the military lifestyle. So that networking, building on their volunteer activities, building up a history of project management and involvement within the military community. They have a lot of skills that the hard skills and the soft skills that come with being [a member] of the team. We at First Data and I know a lot of other companies do, especially Bank of America, have looked at military spouses on their own as a very valuable human capital talent pool that we want to draw from. So on the private sector side, we need to look at things that make us competitive in their eyes, knowing that eventually the private sector is going to catch on and realize that military spouses are just as valuable as veterans and we’ll start adapting, but hopefully we’ll be ahead of the curve with mobility policy, flexible work hours -- that company culture that celebrates service and values it.
Pinckney: So if your spouse is listening in, what kind of advice, some specific examples of things that spouses can do, especially to secure a job or to just look at any other financial aspect that would benefit them. Could you talk to that?
Runnion: So I’ll start. I think understanding what your family needs is important. So on a broader stance, what’s the community look like that we want to go, what assets do they have there, educational assets, religious assets, housing, those sorts of things. And then start to narrow down where. Don’t necessarily go right back home, right? I left east Tennessee. I’m going to go right back there. I love you guys in east Tennessee, but you can go back there because I had an opportunity to go elsewhere. And use some of the tools that we have to help that planning.
Pinckney: Can you talk about it?
Runnion: Yeah, the Better Money Habits tool we have works families through specific budgetary issues, housing, cost and expenses, taxes, what the tax implications are and moving to different parts of the country. Credit, how we use credit, avoid things like getting into debt when you are in transition. Many veterans had an opportunity or had the need to buy a home, because they had one based housing --whatever the case is. But look at the benefits like our VA Home loan, or how we apply for that if we’re going to college, spend some time with the VA to understand the GI bill process, how long it takes the lead time to get you paid, to understand the school that you have, or what those financial needs are. Again, we create tools that will help you do that through our Better Money Habits site -- allow you to make one decision at a time. But there are many tools out there from not-for-profits, as well as the Department of Veterans Affairs. Five-hundred financial counselors from federal affairs are available to give you some financial advice. Don’t walk into this thing half blind.
Pinckney: Speaking of the Veterans Affairs, we have to go back to the researcher. Phil, would you talk about some of the, not into a lot of details, but generically speaking, some of the benefits that we want to make sure veterans are continuing to understand and just the whole idea of the Veterans Affairs is not just at the headquarters -- like in DC --that they’re in every state [that discussion]? Can you talk a little bit about that?
Phil: Sure. And that’s a great point. The Department of Veterans Affairs traditionally does health care for service issues, and also disability compensation. But they do a lot more than that. They do home loans as Lewis talked about. They obviously support, fund and administer the GI Bill, which includes transfer ability for military families as well if you serve long enough on active duty. They provide vocational rehabilitation if you’ve been disabled to a certain point. They provide life insurance. They provide a lot of other benefits that can be helpful. The military is also broadening its transition programs to allow you on space available basis to go back to the top program depending on where you live after service and maybe leverage some of those benefits and programs after you leave or allow military spouses to the same. The National Guard does a lot and the State Department of Veterans Affairs do a lot, too. There’s a lot support, but the number one thing is -- you’re walking on that tight rope without a net now. You’re out of the military and so you’ve got to make sure that you make decisions. Not taking on too much debt, having enough in savings, having enough for a rainy day because that’s the thing about being an adult in the civilian world is you’re on your own and you get the benefits of choice, but you also get the risks. And that’s the really big difference from that and military.
Pinckney: Right, on active duty you’re not going to get it. I mean you go to a military hospital, you don’t going to have to pay for that. You’re going to get out for the most part you’re going to have to some health care insurance.
Carter: But as a civilian, if you go to the ER instead of to your primary care doctor and maybe it’s an out-of-network ER you’re going to get a bill. And if you don’t pay it, that’s going to end up on your credit and that’s going to hurt you getting a house and so on and so on. And you’ve got to think through those thing because it’s a fundamentally different game.
Greentree: And even -- in the private sector, on the background checks that we do for employment, your credit history, your ability. That plays in, just like it does in the military your security clearance, your financial background can affect that. It can do the same in the private sector.
Pinckney: Affect your ability to get a job.
Pinckney: Definitely. People don’t, I think people underestimate the value of having good credit and that’s why programs such as what you’re talking about, Lewis [are important]. Understanding that budget and the benefits that the military and VA provides, we have to consider all of these things. I think we’re thinking about them subconsciously we just -- I think in this fog often times because it’s just the unknown, we’re stepping out, we have to embrace it cause we are all going to have to make that transition.
Pinckney: So… pitfalls. We talked a little bit about this Lewis, but there are some unexpected expenses that come to play when we’re transitioning. Can you think of some other areas that possibly [can help], some [other] programs that Bank of America [has] or just any other experience you’ve had?
Runnion: Sure, you’re asking about pitfalls and I would say right off the bat think about things like PCS Moves. Right, so we were all compensated with PCS Moves. I think the military’s gotten a little tighter now on -- We all probably made a little bit of money on PCS Moves. Don’t report me to the IG for that. But when you move now if your company does not have relocation--and many companies are going to hire you directly in -- use your PCS wisely. So if you’re offered a job at a company that doesn’t have relocation make sure that your PCS takes you to that location. You know, don’t PCS to your hometown and then move 1,000 miles away. That’s coming out of your pocket to do that. Just the startup cost of…
Greentree: Buying a suit for the first time.
Runnion: Yeah, there’s lots of -- How do I dress? There’s a lot of startup costs that are involved. What do we get $900 for uniforms when were on active duty? Something like that. You know, civilian employers don’t give you that $900.
Greentree: And some of us are bigger when we leave than when we started. (Laughter)
Runnion: So transportation costs, school costs. Your children may have gone to DOD schools. There may be costs that you’re going to incur in your community now that you just didn’t see. So think about all those things, go through those budget worksheets, understand what the costs are. What the job offer may seem like, ’m getting a pay raise to do that, but once all the taxes are taken out, the cost of living, those sorts of things, you might end up seeing that you have less income.
Pinckney: And health care costs can really be big
Runnion: They are.
Pinckney: Because if you need an operation. I was one of those major surgeries before I got out of the military. I can’t imagine what it would cost you know had I not been on active duty. But, I mean. That’s just one of those that can really be if you haven’t planned properly making that transition could…
Greentree: And also, you know I was thinking with Transition GPS now, everyone should consider that the least that they can do, the very, very least because there’s so many resources out there that are free or that are targeted exactly to the military community through, you know I was thinking, the VA, the Department of Labor with their American Job Centers. They’ll go over resumes, they do interviews, and you have the SBA. We know that about 25% of service members transitioning out want to start their own businesses. The SBA has veteran business outreach centers all across the country and, you know, it’s a great time to be a veteran to be transitioning out into the private sector who is, you know, competing for the talent. It’s a great time to start a business as a veteran or military spouse. There are resources abounding. And you know, if we can impart the knowledge or the wisdom to consider Transition GPS to be one thing. Actively seek out and augment that with the variety of resources and opportunities that are at your fingertips.
Carter: And probably also remember that veterans are people, too. And so they face many of the same issues that the American working class and middle class face because that’s who they are too. And so making a smart decision about renting or buying a house. Probably the biggest financial decision anyone will make. Same decision about a car. Having adequate retirement savings, most Americans don’t. Don’t be that person. Start saving now. It’s different in the civilian sector. You don’t get a defined benefit pension by in large. Very few exceptions today. You’ve got to set a little bit aside each year and invest it wisely. You’ve got to make those smart decisions and that’s a big change because in the military if you serve and do well, Uncle Sam will take care of you. But there’s no Uncle Sam in the private sector. You’ve got to be your own Uncle Sam.
Runnion: Well he is, but you write him a check on the 15th of April. (Laughter)
Carter: Yeah, that’s right. He’s a mean uncle.
Runnion: Yeah, that’s right.
Pinkely: Okay, I think we will take some questions from the audience because we have some good ones here. And the first question is, what are the biggest challenges for retirees between the first and fifth year of getting out? Those first five years, what are some of the biggest challenges that they will face? Who wants to be first?
Runnion: So I’ll start. They’re going to have similar financial challenges that everybody does when they’re transitioning, but I think the biggest challenge for retirees is their self-identification. They have. From my experience and the hires we’ve made, they’ve identified themselves as Colonel Jones or Sgt., Major Smith. And now their retired and they’ve left the uniform behind and it’s very difficult for them to identify with Joe Smith and Tom Jones. So I think, spend time with people who have gone before you. Ask how they made that transition. You know, I think you guys probably would all agree with this. People who don’t serve they have a predetermined idea of what all military is. Maybe sent by some of those who have retired and come in as still as Sir or Major, which is “Hey, Sir or Major, I appreciate your help.” So I think this is probably the biggest challenge I see is just the identification.
Carter: I think that’s right. I mean I also think that it’s broader than that for career military personally, maybe for all of us. You know, you chose this military life because you want to do something larger than yourself. And maybe you stay in longer because you really believe in that. And then you get out and you work for a private company or a small firm and you need to find some way to replicate that same sense of purpose in your life. Maybe at work, maybe with your kids, maybe with your church or synagogue or somewhere in your community. But you’ve got to keep that flame alive. That flame of purpose, because that’s probably what motivated you for your entire military career and I think it’s the key to happiness, I think, afterwards.
Pinckney: I think that’s why a lot of people get out and come upon a non-profit because that’s their serving. They’ve served during their own active duty and they’re continuing so they see the benefits of serving in that capacity as well.
Runnion: Yeah, I agree with that. I’m going to steal something from General [x] who last week spoke. You know the biggest benefit that I’ve received in the military is my chance to serve and I want to continue to do that when I leave active duty. And I think that’s probably true for at least all of us on the panel here. And we banter back and forth usually around the first or second Saturday in December, but the reality is whether or not she wore the Navy uniform and I the Army, we know we can rely upon each other. We have a common set of core values and what I’ve found is that, you know, my network is larger. I have a lot of civilian [friends] that never served, but I rely pretty closely on my veteran friends whether we’ve served in the same area or not, whether we served in the same service or not. So develop that network and try to leave that uniform off when you go to work.
Pinckney: But as a retiree, though, and you’re getting out and it’s within that five year window. How do you know if you’ve saved enough? How do you know that?
Carter: So the bind retiree’s face is that they’re closer to 65 than the rest of us. So they’ve got less time -- me too know, I’m getting old. (Laughter) So we have less time to let our money rise in our retirement accounts before we maybe stop working. And so you’ve got to be a little bit more aggressive with your savings. You’ve got to be a little more aggressive in your investments.
Pinckney: And you can afford to be little more aggressive because you’re retired. That means you’re getting a guaranteed income.
Carter: Right, that’s right, but not all folks will find themselves in that position. So about 17% of people in the military will actually retire with a pension. The 83% won’t. Those folks who get out in 10 or 15 years, they’re getting older as well so they have to start planning along those lines as well.
Pinkey: And they may have college expenses and other things as well.
Runnion: So probably the number one drain of money particularly for those who do five years or less, is the purchase of an automobile. And those of you sitting out there watching right now. How many of you got a really nice truck or a really nice car and that payment is backbreaking. It’s a great vehicle to drive. It looks good sitting…
Greentree: The only reason I don’t is because my mom was with me. She made me buy a Civic.
Runnion: And so I bring that point up because when you think about financing it’s important that you save money. And I’m sitting here saying this and I know that there are people saying that it’s difficult to save. Make smart financial decisions when you finance things. Understand what those rates are. Understand what it’s going to cost you to own that truck. I’ve got a Silverado myself and I love it, but I went in eyes wide open what that vehicle was actually going to cost me. So that when you do get ready to transition from the military, you do have that nest egg saved up that you can make a smoother transition and it’s not so stressful on the family.
Greentree: And I would always go back to, when you can expect to be retiring and that decision can be made for you on the other side. And so that plan early and plan often, I don’t think we can say that enough because you could have expected the 20 years and because of a lot of different factors that isn’t. And then you’re even doing this transition earlier and without all the benefits that you thought you’d have.
Pinckney: Okay, so were talking about retirees within the first five years and then we were also I think starting to talk about…
Runnion: We drifted a little.
Pinckney: It’s okay. (Laughter) But either way, there’s a lot of planning that’s involved.
Runnion: That’s right.
Pinckney: And if we don’t really understand those implications we can find ourselves in really, well, there’s reason to be very concerned after we’ve made the transition.
Runnion: So I can add one final thing. There’s a one-third, two-third rule that really applies to retirees, right? And so take two-thirds of your time to plan for one-third of your mission. So, if you want to retire early, you should have been planning all those years up to that point.
Pinckney: So I have one [question] here that says, I’m a personal finance manager at an Air Force base and teach the personal finance part of transition of the transition program. What else can I do to help people? I think it’s a good question.
Carter: That’s a very good question.
Runnion: Understand the resources that are available. So whether it’s a program like ours in Better Money Habits or some of the philanthropic organizations that have developed programs that are meaningful to active duty military and their spouses as they get ready to transition. Understand also what format those come in and so, in Phil’s day, he would like stone tablets and chisels. And today it’s multimedia. So go find those best resources that are available and share those with the service members that are. The majority of the organizations that do these, it’s not a lets sell you a product, it really is an educational tool.
Phil: What I use is an (inaudible). You know it’s more also about understanding the value of any particular choice. And so it’s not just about what you want it’s about what’s it going to cost me down the road. So, and I keep coming back to health care because it’s what I do a lot of my research on. You know what’s the difference between an HMO and a PPO in terms of doctors I can get to, facilities I can go to and dollar cost of my pocket and figure it out on a calculator or on the app. You’ve got to figure that out because it’s going to hit you and it’s like we talked about. It’s not like you’ve got a military health facility you can just walk into and say give me my Motrin. Now you’ve got to go get your own Motrin.
Greentree: And there are, you know the non-profit world has really risen up to provide services on that continuum of service so that you know you have the MOA’s, the DAV’s and the VFW’s and the American Legions that can help again for free. There not trying to sell something, they’re trying to make sure that if you need someone to help with that, [they will help]. And if they don’t do that they are going to point you in the right direction so that you can make those good choices because you know I just keep going back to the fact that you have to make a lot of decisions in the spur of the moment, in what seems like a very constricted time schedule, that are going to end up affecting you for a very long time.
Carter: Yeah and to use the car as an example. One of the places I lived after active duty was New York City. I got rid of my car to live there. That was a smart move. There’d be no reason in the world to have a car if you live in the five boroughs. Other places you might need one. You’ve got to make that smart decision mass transit versus car, rent versus buy.
Pinckney: Right, you’ve got to do your research.
Runnion: I would say that the three biggest expenses when you get out are going to be housing, health care and taxes. And then kind of lump everything else under those and think about them as you start to transition.
Pinckney: Let me just put things in perspective. When I got out I needed some extensive dental work. Not to say that they’d been neglected, no they’d been doing a great job, but when you start talking about implants, you know, you can find yourself spending thousands of dollars fairly quickly. And if you’re not covered in that area. That’s an out-of-pocket expense that’s going to be pretty costly. So health care, we’ve agreed is definitely one of the largest, and housing, those are very, very…could be… very large to get out (inaudible) you need to consider.
I have another one (question that) I’d like for us to discuss. Do service members have tools to negotiate salary and bonuses in the civilian sector? I think that’s a good question. And we know the answer is…
Greentree: Well it depends. No, they definitely do and that’s something I’ve actually seen coming through from different resources that tell -- either women or service members -- how to ace the interview, then how to discuss salary and how to talk about bonuses because bonuses aren’t certain and salary can change. But the best way to prepare for that is to go to a lot of the career fairs.
Pinckney: CareerBuilder.com does some of that.
Greentree: Yes, and talk to different companies. Especially the ones that you might not, I know this sounds counterintuitive, but the ones you might not be interested in because then you’re not actually as nervous than when you’re talking to the person to say, you know, what are the benefits that come with employment at your company? Do you have a guard and reserve policy if I go on my annual training? Is it paid, is it differential pay, do you pay at all? Ask a lot around for different companies to see what they are and what to expect.
Pinckney: I’m thinking to negotiate a salary or bonus you have to have a feel for what you’re worth. And you have to have a feel for sort of a [general]…
Greentree: What the market will bear. And you can find that out.
Pinckney: But I’m telling you, you don’t know getting out. I mean I was -- I just didn’t know who to ask and so I had to sort of look around and find people.
Greentree: Well it’s awkward.
Pinckney: Well yeah, because were not used to. The military tells us what were worth, right? I mean it tells us when we’re going to get promoted. We know these things, but really if you don’t know what you’re worth, you really need to do some research and you really need to seek people that you believe in and that you trust and they’re sort of in that area and they can provide advice and guidance. A lot of people don’t like to have this kind of discussion.
Carter: Yeah, and you know, in the military in Iraq. You’d never think about going out on a mission without having intelligence. And so you’ve got to have intelligence first about yourself. You need to know what you need to make to survive and thrive in a given place so you’ve got to have the budget and know what your floor is. But you go out and you collect this intelligence too. And there are great websites. CareerBuilder is one of them, Glassdoor is another. LinkedIn now provides a lot of data on salaries. You got out and you collect that intelligence and you also do it through human networks and you ask your mentors and your peers, “Hey, what’s a range for this kind of a job” and get a sense of how much that is and also get a sense of how much is your worth to the organization. And you have to negotiate and you have to be your best advocate. Don’t negotiate against yourself. Don’t take the unreasonable position right out the gate. Ask for a little bit more not out of the ballpark, but advocate for yourself enough so that you can come to that reasonable position towards the end.
Pinckney: And sometimes people say that’s hard to do because were not used to asking for a salary. You know.
Carter: In fact, it’s an Army value, and I suspect for the other services, too, selfless service. We are humble, we don’t search out the spotlight, we don’t ask for the benefits, but it’s different in the civilian world.
Pinckney: That’s right, we don’t talk about ourselves. That’s that mental difference in the way you think.
Runnion: Yeah, you must do your research and so talk to other people at the companies you want to go, the business that you’re in. Understand what that bracket is. I actually see salary being less of the issue than responsibilities. So a lot of military veterans will maybe not be so as concerned about salary as well you know I really want to be responsible for 5,000 people in this line of business that you have. That’ll come in time, but it’s probably not going to come now because you don’t have tactical proficiency to do that.
Greentree: And that’s that alignment of expectations and understand with any transition that you know it doesn’t have to go like this it can go like this and as long as you’re on that upward trajectory. And that’s actually another great thing to talk to with the companies that you’re thinking about going to while they explain their benefits and salaries is that what my career trajectory is? Do you have a plan for me to progress because in the military there is a plan to progress and we want to make sure that we’re providing. And I want the same thing and we all want the same thing to have an upward trajectory and companies need to be able to talk to that.
Runnion: I would say that’s a top two frustration with vets is that we’re accustomed [to] as veterans on active duty [is] that I’m going to be in this job for two to three years and if I’m in there any longer than that, that I’m probably doing something wrong. I know what the next role is going to be. Kind of widely across the corporate world this career mapping is a little foreign to us and I see vets get frustrated with that.
Greentree: That’s a benefit to having veterans in such large numbers transitioning to the private sectors that I think were benefiting from a lot of the qualities that they’re bringing to our companies. Some of the best programs that were doing around our onboarding and affinity groups that are really changing the culture are started because we were thinking how we can help transition veterans.
Pinckney: Is there something about this onboarding, especially for military?
Greentree: Onboarding. You know we love to onboard in the military and we do it really well. And we want to make sure that when companies are hiring veterans that they’re also retaining them and promoting them and professionally developing them. But really the onboarding can make or break that 90 day or if they decide to stay less than a year, which is not always bad but we want to do everything on our side to make sure that if they do chose to leave that 1) They’re better for having worked with us and 2) that we made sure it wasn’t because of something structural that was wrong with our onboarding process or ability to assimilate on our side. And so we do check-in calls, they get a special onboarding packet. It’s a “welcome aboard” packet because were Navy fans and they get a 90 day check-in, a six-month check-in and they’re invited to join the military affinity group. They start getting a newsletter and a calendar. Just things you’d expect when in the military when you had a sponsor. We wanted to make sure that they get the tie if it’s important to them to have someone in their department, if it’s important to have someone of another female, someone from Tennessee.
Runnion: A translator. (Laughter)
Greentree: To translate the southern language.
Pinckney: Okay, you’re stepping on some toes now.
Greentree: But yes, the onboarding part is I think another part of the transition. Because they’re going to decide if their identification of themselves reflects what your company is telling them.
Pinckney: What about any statistics, Phil, that you know of that speaks to how long on average the military veterans once they’re employed how long typically, well say on average, they say whether or not there’s such a large transition.
Carter: So there are some and some data suggests that some veterans will leave their first job within a year of taking it. The challenge is that’s true for all Americans, too. There’s a lot of turnover in the workforce.
Pinckney: It’s really stressful regardless.
Carter: And it’s not true because they are veterans, its true just because there’s transition that happens on a day to day basis. Again it highlights need to have to build you build your own safety net. You have to have the ability to go through that transition over and over again because that’s likely going to be the new normal. In the military when you move between jobs, your paycheck didn’t stop. That doesn’t happen in the private sector and you have to think about that. Even if you’re going to leave one job on Friday and start the next one on Monday it might take a month or two before the pay and benefits kick in and everything. You have to factor that in, too.
Pinckney: That’s stressful. Thank you. Did you want to say something?
Runnion: I’d like to talk a little bit about reserve and guard. And maybe ask the panel to help here. We have several thousand guard reserve that work for us and as a company… (inaudible)… and so we want to encourage our associates to continue to serve and some that’s the service that they’ve known is the guard reserve. And so some of you are sitting out there probably thinking well companies don’t like me being in the guard reserve because it takes away from the time I have with the company. At least from a large company perspective, I’ll tell you that we encourage you to do that. Continue to serve your country, develop your leadership skills both internal and externally. And we also want those reserve members and guard members to help with transitioning service members. Why? Because they wear this uniform Monday through Friday and they wear you’re uniform of service on the weekends and during their annual training. So they really are a great resource for transition, but what do you guys think about that?
Greentree: It comes down to it’s just an enormous pool of talent and we know -- I mean at First Data -- we know that our biggest asset is in our human capital. So when we find pools that are have a lot of substance like the military community does we want to do everything we can to be competitive. Because we’re a global company, but were smaller than a lot of companies. We have a lot of locations in the U.S., but maybe we don’t as much as someone else. So we the military community to know and engage them where they’re at whether they student veterans, military spouses, guard and reserve, if their active duty doing an internships. Because we know that our culture will be better for interacting with them and they’ll be better for having this experience on the private sector side and with our guard and reserve we actually did just change our policy to become the most expansive that it could to pay the full pay for the annual training. We had done, it was our last small thing, and it wasn’t very hard to push through, I have to say. Our Chief of Human Resources was like, “uh yes,” when you show him the benefits to that. I think that when companies see benefits and make these policies earlier are going to be the ones hopefully that reap the benefits. Any company that you wouldn’t want to say you’re a guard or reserve or a military spouse or veteran, you know, come to First Data. Send me your resume.
Runnion: I think it’s really hard for small companies. So a small company with 10 employees if someone has to go away for two weeks or maybe they do a long-term deployment that really hurts the workforce a lot. So it’s not as much for us to do that. Were happy to continue to support or help as much as we can those smaller companies that support the community as well.
Carter: And what we’ve seen in the data is that reserve affiliation tends to be a positive factor for veterans when they leave the active service. It’s not just an immediate succession of the military status but you get some benefits that continue. You continue to wear the uniform and you have that sense of belonging and those can all be positive for folks as they make the transition. For some, it’s also really valuable in the sense that they can develop skills that complement the workforce profile that they want to develop. And so overtime you can build your portfolio of experience in ways that really complement each other. There’s been a lot of learning in the private sector about statues that protect reservists, the rules for mobilization and so forth. We did a study a few Years ago that says there’s a great deal of concern on large employers about these issues. Now there seems to be a little bit less. And buy in large most medium and large employers understand their legal obligations as well.
Greentree: The ESGR has been a great resource as we learned our way through all the processes that it takes and how to kind of be the best employer that you can so that hopefully our guard and reservists go out and tell all their guard and reservist friends, “Hey, here’s an employer than I can continue this trajectory and this private sector trajectory and they haven’t made me chose.” Because, ideally, they can do both and be successful at both.
Runnion: I’ll transition a little bit on the same topic. Many of the services has started a transition alumni program and probably the best known is the army soldier for life which is they have spent a lot of time building relationships around the country with employers understanding what needs are conveying that back to army leadership and then creating a community so that Phil and I could be an alumni. I know the Navy is still a little bit behind that, but I think that you’re going to challenge that. Understand that as you leave active duty what some of those programs are. So we talked about guard reserve. Understanding things like soldier for life and the Navy does have a program.
Greentree: Safe Harbor
Runnion: Safe Harbor. Understand what those benefits are. Stay connected. It’s what’s important to you in your transition.
Pinckney: I think because of all the deployments and just downsizing, all of the services now really understanding the importance of doing strategic partnerships. You know doing partnering more with corporate America. I know that as I was exiting the military it was a challenge because looking at legal aspects of you got to appropriation of dollars, you aren’t supposed to enhance, you know, so I’m happy that we’ve figured that out a little more and we’ve gotten better at it because these strategic partnerships and efforts that we end up forming benefit not only the military, but also the civilian sector as well.
Greentree: As Americans, we have to.
Pinckney: It’s a win-win.
Greentree: We have to hope that people continue to volunteer to serve in the military and they’re only going to do that they’re lives are better off for having done that. And their families are going to play a big part in that in how their children fare and how their spouses fare and how they themselves fare. And it still comes back to the bottom line, if we all want to continue to have an all-volunteer force, we just want to hire the best human capital that we can. The same on the public side, the same on the non-profit side and the military wants to keep recruiting people by saying that look you’ll be better for this and we all have to do our part.
Pinckney: I’m going to go to one more question and then well start to wrap it up. What kind of resources can we use that will speak the simple language when we’re looking for healthcare options like life insurance. Is there an institution that provides all these answers in one place?
Carter: I don’t think that there’s one institution. And that’s again part of the transition of how you used to be able to go to your first sergeant or of your company and ask how did you do this doesn’t exist in the private sector. There are some good ones for each of those. Your health insurance company whether is Kaiser, United, has a good tool for healthcare planning. You know, banks and others once you speak to this have tools on that side, but you’re going to have to navigate that sea on your own.
Runnion: So to add to what Phil said. I think there’s a myriad of resources available to have a single expert that can do health care, retirement plans and overall financial plans is pretty tough to find that. Use tools like we’ve created. The VA has a great set of resources that are limited to what.
Carter: Particularly, for education. Their GI Bill comparison tool is fantastic.
Runnion: Just don’t leave any benefits on the table. So VA was seeing a lot of GI Bill level being left on the table and I think that’s a huge mistake. I think that even if there’s, yeah, the transferability. Use that to pursue a degree or interest, if you have a good job, don’t waste your GI Bill money on things that won’t benefit you or your family.
Greentree: So now I want to start my own business that does healthcare, financial planning and all that rolled up in one.
Pinckney: Well we’ve had a great discussion. I think we’ve talked a lot about the hurdles and pitfalls. We talked about some of the solutions that and a lot of information about research and what resources exist today. I’d like to go around to each panel member and say if there’s one thing important that you’d like to impart with this audience, what would it be?
Carter: Sure, I think that the one thing I’d say to myself, if I had myself in front of me from 15 years ago is that don’t be afraid to grow [your hair] out a little bit and shed that military identity and go to the civilian world and embrace it. You know maintain the good habits you had, but become a civilian. Recognize that success in the private world is different. You don’t have to have a high end tie, you don’t have to walk around like a Sergeant Major, and you just have to be a civilian and still be okay.
Greentree: Prepare, prepare, prepare. I don’t think you can ever prepare too much and again to start early because sometimes the decisions that you think you’ll be making are sometimes made for you and the more you have built up on the preset side the better you’ll be to make good decisions not in a hurry or under duress. I will take two because I also think this one is very important is networking. Networking, networking, networking. Because I know we talked about the importance of that. But 85% of people will get their next job through networking. And there’s veterans in every county across the country. So find the veterans because no one wants to hire a veteran more than veteran. No one wants to hire a military spouse more than a military spouse. And you know, we’re everywhere. So prepare and network.
Pinckney: Good, thank you.
Runnion: I think in closing, if people don’t plan to fail, they fail to plan. And so you need to think about what your plan is going to be now. Don’t wake up and find yourself 90 days out from transitioning, “I think I’ll start looking for a job now or career”. Or you know you’ve gone through your ETS separation, the compensation you got and you’re “oh maybe I’ll go to school in August” and it’s the end of July and guess what, you can’t get accepted. So you have to plan and use the tools that are available that I’ve talked about some of those today. Use those tools that are able to network in community, follow others’ lead and you’ll be successful.
Pinckney: And I would say that for me it was figuring out what exactly it was that I wanted to do when I got out. It took me some while to figure that, it took some time. I talked to a lot of people. I knew, I didn’t really want to work for anyone else when I got out. And actually that proved to be true because someone convinced me to work full-time for them after I got out. And that was the worst mistake I could have made. It was a good experience. I learned a lot but it wasn’t what I wanted to do. And once I figured out what I wanted to do something for myself, then I started talking to the right people. I went and did some research, and went with small business. I would say, figure that out. It seems simple but it’s not. If you take the time to do that, and then go find some resources to support what that decision is, I think you’ll end up enjoying the second career.
Pinckney: Thank you so much. You’ve been a great panel. The discussion has been great. I hope the audience has enjoyed it. I know the audience has been great because we’ve got some great questions in. If you’re interested in continuing to hear more about this discussion, it is being taped and I would just suggest you stay in contact with Military Times. Thank you, you’ve been a great audience. And hopefully we’ll see you soon!
Bank of America Joins Military Times to Empower Troops in Transition
Going from being an active-duty service member to being a full-time civilian has its opportunities, as well as challenges. That’s especially true when it comes to managing money.
We recently partnered with Military Times on a discussion to address these financial challenges, as part of our longstanding commitments to helping service members and veterans transition to civilian life, along with helping people get a better handle on their personal finances.
The conversation was led by Brigadier General Belinda Pinckney, U.S. Army (Ret), CEO, BHP Consulting, LLC and the treasurer of the Army Women’s Foundation. Panelists included Vivian Greentree, Ph.D., head of Military and Veteran Affairs at First Data, Phillip Carter, director of the Military, Veterans and Society Program at the Center for a New American Security, and Lewis Runnion, public policy director with Bank of America’s Military Affairs team.
Sharing their own experience as veterans, along with their work with veterans and their families, the panel addressed some of the big and often unexpected financial hurdles that service members face:
• Health insurance
• Tax obligations
• Retirement plans
• Finding employment
• Going back to school or finding child care
To learn more about these topics and hear the full discussion, view the replay above.
Overcoming these challenges can be daunting, especially if you don’t know where to look for help. The good news is that resources exist. Whether it’s reaching out to a military support group like Blue Star Families, or looking to online resources like BetterMoneyHabits.com, our financial education website developed in partnership with education innovator Sal Khan and the Khan Academy, service members should always be assured that they are not alone.
We strive to connect our heroes and their families to the training, education and resources that put them on the path to financial stability. Learn more about how we’re helping our nation’s military here.