Make a goal, show some discipline, and accomplish your dream.

If you are considering joining the Army, or any military branch really, we need to have the talk.

I’ll just be upfront with you, I wasn’t the smartest brick in the wall when I joined the Army and I didn’t save a dime during my first 4 years.

No one gave me the talk. So, pay attention, this could change your life.

If you are going to enter the military after high school, as I did, then you probably have no debt and no credit cards. That’s great! You just need a little mentoring and after 4 years in the military, you could end up with over $25,000 in your savings account, a 401K retirement account, an Associate degree, a college scholarship valued at over $100,000, and a bunch of other benefits.

To tell you the truth, even if you have some debt and / or a car payment, this plan will work for you.

Summary of Savings Program (Yes, this is possible!)

End of Year 1: $5,000 in savings (plus a car payment)

End of Year 2: $12,000 in Savings (plus a car payment)

End of Year 3: $19,000 in Savings (plus a car payment)

End of Year 4: $25,000 in Savings ($20,000 car paid off)

How To Do It

A Goal without a Plan is only a Dream

— Brian Tracy

Most come into basic training as an E1, which pays about $1600 a month after taxes. At a minimum, you should try and save half of that each month, say $750 per month for the first two months, which would give you $1500 at the end of basic training. If your AIT is also 8 weeks, then you should be able to save another $1500. So after 4 months, you would have at least $3000 in the bank.

Double-check my math by looking at the Current Pay Tables.

First duty assignment

You will probably want/ need to buy a car when you get to your first duty station. That’s fine. You will need a car when you get out (If you get out).

Once again, think about your long-term goals and think frugally. I saw so many brand new recruits buy expensive cars and then the only thing they could afford was the car, the gas, and the insurance. You should get a nice car, sure, but look at something where the payments will be about $300-$350 a month for about six years. That way, the payment and insurance will run you about $500 per month. You have $3000 in the bank, you could use about $1000 as a down payment if necessary. If you follow this plan, you will save over $25,000 by the time your 4-year enlistment is up and can pay the difference on the day you separate if you want.

Most recruits are promoted to E2 when they leave basic training, so you should be making around $1900 per month after taxes. If you bought the car then you have about a $500/month payment with insurance. Continue to save $500/month for the rest of the year. This will give you $5000 by the end of the year (if you paid a $1000 down payment for the car). You will only have about $900 a month for your personnel expenses, but as I mentioned, all your basic needs are covered, including free gyms.

Work Out, Save Money, Soldier On! You can do this!

Year 2

By the end of year 1, you should be promoted to E3 (hopefully sooner) making about $2000 per month after taxes. Now, raise your savings to $600/ month, while still paying the $500/ month for the car, which will give you about $900 a month for expenses (after taxes). Stay the course. You’ll also get a small clothing allowance on the anniversary of your enlistment (consider that a bonus for all the good work you’ve done). If you follow the plan, you will have over $11,000 in savings by the end of year 2.

Year 3

If we assume you didn’t get promoted to E4 in year 3, which is unlikely, but let’s imagine the worst possible scenario, you’ll be making about $2200 per month. Keeping your savings at $600/month and paying your $500/ month car will give you about $1100/ month for your personnel expenses. By the end of year 3, you will have over $18,000 in savings.

Year 4

You should definitely have been promoted to E4 by now and you’ll be earning over $2500 a month. If you continue giving $600 a month to your savings and $500 per month to your car payment, you’ll end the four years with over $25,000 in the bank.

If you decide to add another $500 a month this year to your savings then you would end up with over $30,000 by the time your 4-year enlistment is done.

You can use some of your savings to pay off the rest of your car as you leave the Army or you can continue to make the payments, whatever you are more comfortable with.

What it All Means

Obviously, if you were frugal, you could save a lot more, and if you got promoted faster or entered the Army at a higher rank, you would have more cash to save.

My purpose here is to show you the possibility of leaving the Army after a four-year enlistment a lot richer than when you came in. A car paid off free and clear. No debt. Free college during your enlistment and another four years of college paid for after you leave the military. And, over $25,000 in the bank.

Having this much cash and a car almost paid off gives you a lot of options — you could stay in and continue your military career, get out and go to school, take a long vacation to sort out your life goals, or get out and start your own business. At the end of my enlistment, my options were to get out as poor and uneducated as I came in or stay in the military. Don’t be like me, you can be smarter than that.

In future articles, I will show you the options for setting up a retirement account in the military and the reasons why it might be a good idea for you.