USAFA 401k

[ServantoUSA]

I was recently appointed Class of 2022 and was wondering if you can start putting money into the 401k or TSP as a cadet or does that not begin until after commissioning.

Thanks for any help!

 

[Stealth_81]

You will have to wait until after you commission for the TSP. You can put money into an IRA/Roth IRA while at the Academy, however.

Stealth_81

 

[ServantoUSA]

You will have to wait until after you commission for the TSP. You can put money into an IRA/Roth IRA while at the Academy, however.

Stealth_81

Thanks for the help! Is there a way to automatically contribute a portion of the paycheck albeit small to an IRA to avoid the temptation of spending it? Also, I was wondering if there is a way to pay a part of the ACE Loan beforehand so that your paycheck can be larger.

 

[BlahuKahuna]

I would just use USAA to set up any investments/autopay. Don't know about ACE Loan.

 

[raimius]

Automatic funds transfers from your bank account works very well. (Fewer screw ups than relying on finance/dfas.)

 

[FMHS-79]

It was easy to setup to setup a USAA Roth IRA with automatic monthly investments (funded by direct transfer from his USAA checking account). We also setup a USAA investment account that we transfer additional funds to whenever my DS's checking account gets over $2,000. We'll use funds from his investment account for special items like his class ring, etc.

 

[mommahedg]

Our DS also did the USAA Roth IRA and set up monthly auto contributions from his USAA checking acct. We will move extra funds into an USAA savings account for class ring, plane tickets etc. It's great that so many of the cadets are already looking at saving money and investing.

 

[AROTC-dad]

Given their long time horizon and the fact that most cadets/mids will be in the lowest tax bracket during the SA/ROTC years, a Roth IRA generally makes the most sense until they are eligible for the TSP.

 

[ServantoUSA]

Thanks for all the responses, but does anyone know about the ACE Loan? Is it possible to pay it down beforehand so that the paycheck is greater?

 

[Stealth_81]

The term ACE loan is not a USAFA acronym so that might be why no one is answering. I think the ACE (Advance for Clothing and Equipment) loan is for USNA.

The answer to your question is no, paying it early will not increase your paycheck. You will get the same net pay as everyone else and if the loan is payed early, the extra goes into a “held pay” account that you would get when the normal loan pay off time arrives. My son had this due to an outside scholarship that was applied to his loan each semester. He didn’t see the money until everyone else did.

Stealth_81

 

[ServantoUSA]

The term ACE loan is not a USAFA acronym so that might be why no one is answering. I think the ACE (Advance for Clothing and Equipment) loan is for USNA.

The answer to your question is no, paying it early will not increase your paycheck. You will get the same net pay as everyone else and if the loan is payed early, the extra goes into a “held pay” account that you would get when the normal loan pay off time arrives. My son had this due to an outside scholarship that was applied to his loan each semester. He didn’t see the money until everyone else did.

Stealth_81

Oh, my apologies for the wrong term. hmm, interesting, Thank you though! I appreciate all of the insight everyone!!

 

[FMHS-79]

Since the cadet "Advance Pay" does not carry any interest/finance charges, I've suggested that my DS put all "extra" funds into an interest bearing account to help build a firm financial base.

 

[Gaittrainer]

Regarding the loan, I'm guessing you will have to wait and see. DS 2018 did have a higher paychecks his c4c or freshman year because of scholarships he took with him. The difference from other posters might be the type of scholarship ie for any college related costs. DS never inquired if he could use his savings to pay off the loan early. There was no need as no interest%.

 

[Capri120]

Regarding the loan, I'm guessing you will have to wait and see. DS 2018 did have a higher paychecks his c4c or freshman year because of scholarships he took with him. The difference from other posters might be the type of scholarship ie for any college related costs. DS never inquired if he could use his savings to pay off the loan early. There was no need as no interest%.

USAFA does not hold back funds. If you have scholarship or pay for other items in advance, you will see more money in your paycheck. DD has a 4 year scholarship that has been covering at least her books. She has a larger net paycheck as a result.

 

[Stealth_81]

USAFA does not hold back funds. If you have scholarship or pay for other items in advance, you will see more money in your paycheck. DD has a 4 year scholarship that has been covering at least her books. She has a larger net paycheck as a result.

I see that this has changed then. That is why I tend to moderate more than post. My information is now almost 10 years old and things change each year.

Stealth_81

 

[ServantoUSA]

USAFA does not hold back funds. If you have scholarship or pay for other items in advance, you will see more money in your paycheck. DD has a 4 year scholarship that has been covering at least her books. She has a larger net paycheck as a result.

I see that this has changed then. That is why I tend to moderate more than post. My information is now almost 10 years old and things change each year.

Stealth_81

Thank you, both... I am very grateful for this forum! I accepted my appointment today feeling very confident in the information gathered.

 

[keeperkat90]

If your asking about the career starter loan that we receive as juniors at usafa, you don’t want to begin paying it off until graduation (unless you take navyfederals and Usaa’s) they want you to pay off the loan in $600 payments each month once you start. It’s a lot better if you invest the loan.
C/o 2018

 

[raimius]

The career starter loans are a great deal, if you use them wisely. The interest rate is often LESS than inflation!

 

[ServantoUSA]

Hmm this makes me wonder, what does the normal 4dig get paid? I've seen a table before but can't seem to find it. Thanks!

 

[FMHS-79]

Working budget is located at https://www.usafa.edu/parents/cadet-financial-information/ - gross pay is 35% of that of a Second Lieutenant (~$1,062/month) and net averages between $350-400/month depending on cost of text books, etc.