More than half of junior Sailors have retirement savings accounts
By Bruce Moody, CNIC Fleet and Family Support Program

More than half of the Navy’s junior enlisted Sailors have retirement savings accounts through the Thrift Savings Plan (TSP). A report released by the Secretary of Defense Office of Personal Finance, shows 62.7 percent of the Navy’s active-duty E4 Sailors as having TSP accounts.

As Sailors rise in pay grade, so do the numbers contributing to their retirement funds: while 39.5 percent of E-1 Sailors have set up a TSP account, the percentage increases to 50.4 percent for E-2 and to 56.4 percent for E-3 Sailors.

The manager for the Navy Personal Financial Management program is located at the headquarters of Commander Navy Installations Command. Arnie Norem, the program manager, attributes the numbers to a training curriculum which has been developed with Navy Education and Training Center and Center for Personal and Professional Development.

Training begins at boot camp, Sailors graduate from Recruit Training Command and immediately get two days of training in personal financial management.

“Sailors are shown how to create a spending plan,” Norem said. “We go over everything from car buying and credit management to financial planning for deployments.”

The training continues throughout a Sailor’s career. It’s presented at least annually during all-hands general military training and each time a Sailor is promoted.

A Sailor going through petty officer indoc will get training on consumer awareness, savings and investments. At the senior ranks, training focuses on topics like retirement planning.

In addition to training, commanding officers appoint Sailors as command financial specialists. These Sailors are generally first class petty officers and go through a weeklong course which prepares them to educate and counsel personnel on financial management issues.

“It’s a powerful program,” Norem said. “It prepares shipmates to help shipmates and their families.”

Fleet and Family Support Centers (FFSC) also provides classes on a variety of issues and individual counseling on financial management.

“One-on-one sessions at the FFSCs are available for Sailors and family members and it’s free,” Norem said. “That same kind of service off base can be very expensive.”

The TSP is a retirement benefit that is offered to employees of the U.S. Government. It is similar to “401(k)” plans available to many private sector employees.

The TSP provides the ability to participate in a long-term savings and investment plan. Participating in the TSP can significantly increase retirement income, though financial planners say getting started early in life is key. Contributing early gives money more time to increase in value through the compounding of earnings.

More information about the TSP is found at http://www.tsp.gov.