To keep your TSP or roll it over to your new career/business retirement plan? (I am not a CFP, just a dude who has done research and has an opinion).
It depends on your retirement plans and goals. The old, easy approach was the TSP had solid returns, but you made your money with the super low rates. Therefore, the traditional answer was hold on to your TSP account. However, there are more and more low-cost accounts these days. And one can get into the argument of whether to select index funds or select managed funds (then you get into active or passive). Here, data generally favors index funds, but managed funds can push you above the average (or below it). Again, what are risk levels based on your retirement plan? But back to the TSP. As managed funds go, they are low cost, but even managed funds are quickly encroaching index fund costs in some areas.
From the cost perspective, it sounds like I am leaning you away from the TSP and you are probably right, at least how I have tracked over the last 5 years and the trends I believe to be the future of stock and bond market investing. However, you also need to look at returns. Now generally speaking, returns have lagged for the most part. However, some of the funds have seen better and more consistent returns to like categories of non-TSP funds. On the surface, Small and International funds have generally been better. However, one needs to look at the stocks held in these categories and the generally strategy of the fund versus your strategy. Is the fund heavy in Tech stocks or Financials? What is your belief of what will bear and what will bull in the future?
Next you need to take into account your own management, or that of your Certified Financial Planner if you choose to go that route. Now personally, I manage my own, but because I like the research and strategy of the market and balancing spots to be conservative and where to get aggressive. But, as you have a TSP, a Roth IRA (probably Navy Fed or USAA as a military member), then get a 401k (example through Fidelity) for your first non-military company, then change jobs and set up a new 401K through Vanguard and then add a 529 college savings plan, etc, etc, etc, it can get overwhelming, so for simplicity sake, rolling these over makes things less complicated.
But wait, there is more. Do you want to become an entrepreneur post military and invest in yourself maybe? Or do you need cash up front for something else and can replace it down the road? Did you know you can take out a loan against your TSP at the current G Fund rate? Yeah, a 2-3% interest loan isn’t too bad, which is a powerful tool.
In the end, the best answer lies with you. As I continue to diversify my portfolio, I have pulled out of the Life Cycle funds and will continue to pull out of the common stock fund. I will monitor the Small, International and Fixed Funds and determine this over time. Likewise, I am like the security of the G Fund currently, but those rates are pretty easy to beat and be just as safe, so as I grow my non-TSP bond section of my portfolio (which for tax purposes is better in your 401K than an IRA), I will begin to pull out of the G Fund. I still have big plans and like the opportunity that the loan provides.
So for now, I plan on keeping my TSP and placing my money into the categories that historically beat the non-TSP funds (currently Small and International) and after I take out my loan and pay it back, I will eventually transition my money to a more consolidated organization, which currently I enjoy Fidelity the most. But that is one dude and based on his goals and plans, it may differ for you.
Stop the Operations Manager and Project Manager titles! Yes, I am cutting to the chase. Just because you worked in an S3 shop in an artillery unit, it doesn’t make you a distribution center operations manager. Because you ran mechanized infantry and heavy armored training exercises (from planning to execution), that does not make you an IT Project Manager. These are generic titles that are causing you to get lost in the crowd. They are the safe play, you are running the draw on 3rd and 20…and so what if you pick up 15 meaningless rushing yards?
Now, there is no one way to do it. Each industry is different, companies are different, and so on. Your title should capture the audience and/or explain, in general, what you did in that position. Heck, even my current position technically is Lead Materials Planning and Execution Specialist. Now I run material production control, which manufacturing folks know. I also manage relationships with suppliers, vendors and customers. I also plan and coordinate material flow. Depending on what I am applying for, I will change my title to reflect one of these three roles or possibly some others. Then I support that with my resume bullets.
You need to do the same for your military job titles based on your experience and what you are applying for (which takes backward planning and know what you are going after, rather than the “this is who I am, someone give me a chance approach,” that many transitioning service members do). There is no problem leaving these titles on your master resume, but if you are applying to a vast variety of jobs with your master resume, that poses a whole different topic and problem.
So back to your title. This also is going to reflect your brand on social media, specifically on LinkedIn. Not only do you have your role and titles in your experience, but you have your personal “headline” title. Now, I am currently most interested in customer support via the supply chain; moving to the front end of the supply chain and eventually the business (out of the supply chain into account management- ie. a sales function). Therefore, my linked in headline reflects as such. Sure, I may miss out on the one in a million program manager opportunity that may be a mutual fit, but only if I am waiting for it to come to me (instead of separately searching that out). The point is, I have done my research and although I managed military programs, I am not a manufacturing program manager. I rather put my eggs in a basket in which I have a legitimate shot at and that I have interest in!
When you put Operations or Project Manager as your headline, be prepared to field questions about roles and positions that you are not interested in or qualified for, or even worse, have people gloss over you because you are just another military project manager, because perhaps they feel you are not qualified to run projects in that company/industry just because you ran projects in the military.
Get out of this mindset you are operations manager or project manager. That is part of who you are, but not all of it. Let me ask you which title tells you more? Brigade Aviation Officer or Director of Integrated Air and Ground Operations. Now I am not saying that is the best title by any stretch, but to a civilian, Brigade Aviation Officer means nothing. Now, director means I am responsible of large portion of the business, and although my job was purely influential leadership, I was responsible for the skies above and everything in it for a 3000-person unit. Integrated air and ground were key words I selected because I believe it focuses on the strategy of integrating separate operations to work in coordination; it shows cross functional leadership.
You know what you know and you believe in all the things TAP presents to you, but the only way to learn this play on words (it gets easier after the transition) is by conducting informational interviews and learning what people, roles, titles, companies, and industries do and how they are organized.
So please take the time to focus on your resume titles. You can learn a lot from my podcast interview with Scott Vedder, author of “Signs of a Great Resume.”
While this may not become the be all end all, it is important. As someone who sits on the other side of the table now, I find myself not knowing what you did in the military and also not knowing how it fits into the civilian sector when reviewing resumes. Take the time to do some research and come up with a title that sells what you did and how it fits into the industry you are applying for…This will be your personal brand and will help the civilian sitting across you understand. After all, you are the one percenter, not them, so keep control of the ball and drive down the field for that touchdown!
There is a difference between your military transition and your career transition!
Leave separating from the military up to the military. They have procedures and processes in place to ensure you get a stamp at each station and you are a first time go at getting the boot! What they don’t have in place are good processes for launching you into the next career.
There may be a few reasons why. Is this the DoDs job? Is there a way to standardize? The list could go and on. At the end of the day, however, you own it! The great part about it is you don’t have HRC telling you your path, where you are moving next, and what position you will take. The bad part about it is that the world is your oyster and there is a lot out there!
So leave the military to there job and start focusing on you! I advocate backward planning, just like we did in the military. Also, I advise focusing as much time on what I call “actions on the objective.”
The transition process is built to continue moving forward one step at a time, starting with how to leave the military, to how to build a resume, to how to translate your skills, etc. All of this is built in forward planning fashion. What draws little conversation is you!
Do you launch on a convoy without a mission? With no direction or planned path? So why would you do this in your career transition? This is why I advocate finding yourself first. Until you do this, you cannot backward plan from that objective. So if that objective is to work as a gaming programmer in Austin, Tx after assessing your interests and your skills, only then can you start putting a route in place to get there.
So what you are heavy engineer mechanic, what is stopping you from achieving your goal? Sure, you have to balance life (family, income, and the likes), but you can strategically put a plan in place to work towards that…if you have a goal. Stop looking for what you are good at and start looking for what you want and find ways to make yourself good at it!
That is the difference between the military transition and the career transition. The military transition is forward thinking with the mission of getting you out. The career transition is backward thinking with the goal first in mind. I recommend the follow method from my Youtube VLOG (https://www.youtube.com/watch?v=QGcnLXuofR4&t=12s), but it is just that, a method. It really doesn’t matter because there isn’t any one way to do this, but rather, it is a way of thinking. Do you want to tackle each challenge as they come, or do you want to control your destiny? Do you want things to be easy with everyone else controlling your life or do you want it to be hard with control over what you are striving for?
Using this backwards planning career transition approach takes some hard self-reflection. Do I really have this skill? Can I handle moving a few more times? Am I really actually interested in that? Could I do it everyday for the rest of my life?
In the end, realize there is a difference between the military and career transitions and ask yourself are you happy moving forward one day at time or do you wish to accomplish more out of your career and life? Depending how you answer this question, will allow you to make the most out of your transitions.
This is not a blog to tell you how to balance work and life. Everyone is different, each scenario and situation are different, people have different goals, priorities, and so on. Rather, this is a post to make military transitioners and veterans aware that there is a life outside of work, after the transition, and that likely it will be different than from time spent in the military.
Chances are you are leaving the military and looking for a change, be it to make money, spend more time with the family, have a family, live in a location you prefer or whatever. After you navigate this transition, you may eventually end up with a void to fill. No time spent in the field, weekends to yourself, no midnight musters, or perhaps searching for a new mission or purpose in life, missing the service greater than self, hobbies and interests, continued education and learning, etc. The bottom line, after a year or two catching your breath, you will probably have some holes left to fill.
The intent of this blog is to acknowledge those holes and develop a plan to fill them. Work may (probably) not consume all and as stated, there will be holes. Don’t let that emptiness consume you! Find a side gig, a hobby, a group of people, or whatever it is that fills what is missing in your life. A lot of vets get into organizations like Team Rubicon or Team Red, White, Blue. These organizations provide a group of people with a similar background and familiarity and mass them to fulfill that emptiness of selfless service. Others re-find faith. Others still yearn to lead, but may not have the opportunity at work, so they coach and mentor youth sports or veterans via Veterati or ACP. Others dive into part time projects that eventually lead to a full-time job, and yet others, simply just spend time “playing catch” (and catching up) with sons and daughters.
This is not uncommon, and you are not alone. Volunteering can still lead to a gain in wealth, which may mean monetarily through networking and offers, but it may mean through education, or purpose, or simply put, by filling that hole. Now, for the first time in a while, things are more about you. So take that time, develop a plan, and use it wisely, after all, it was probably a consideration of why you left the service to being with and time is an asset that should not go wasted!
Let’s be honest, we all want it to be easier. That applies to anything. Heck, as pilot, we had a checklist to make things easier. That is why the military has standard operating procedures, checklists, battle drills, etc. That is why manufacturing applies lean principles. The list goes on and on. Find ways to simplify things.
Then comes the military transition. Most of us search and search for the clear path into a new career. Some say network, so we go to every event, post and comment on social media. Others say focus on your resume, so you format and re-format and work your bullets over and over. Others say interview preparation is the key. Some say use headhunters, yet others say do it on your own. Go get a degree, get a certification, develop your soft skills, develop your hard skills…The point is, there is no one way to military transition into a new career.
You have to focus on yourself and learn who you are, what your interests and priorities are, what works for you, what doesn’t work for you, what your goals are, what your skills are, who your network is and how you can grow it and so on. The point is, there is no checklist, no SOP, because one size doesn’t fit all, and that is a good thing, that is probably a factor in why you are leaving the military. See, there is no clear path, no HRC saying if you want to be a Brigade commander than these are the positions and steps to take. Not only that, there are other factors outside of career that play a role. Community, volunteer, brand/product, location, family, increased education, side hustles, etc. Therefore, there can be no checklist to every possible scenario, because they are infinite. So it circles back to yourself, for once! What do you want? Where are you now? Where do you want to be? And how do you get there? Are there forks in the road to pivot a different direction?
All things to consider and a reason why to start your transition early. See, leaving the military is a checklist, but starting a new career is not. Let the military tell you when to be where and who needs to sign and take the time to focus on yourself as early as possible in your career, because the day will come that you will leave the military.
You must own it! Again, look it not why you are leaving, but what you want to do. Why do you want to do it? What are you interested in? Are you qualified? Take the time to watch my vlog on planning your transition:
It should provide you and opportunity to stop, think, and start to develop a transition plan. Now this is certainly not a one size fits all, but it will work for the masses.
Be open to advice, get out there and network, work and re-work your resume, but make sure you are not dwelling on the past and that you are focusing on yourself. The why am I leaving? What am qualified to do? What do I want to do? And do I need to acquire more skills? Maybe you don’t have the skills and it will take you two years to acquire them on the side and that is fine. Then you consider can I afford to take two years with no pay to acquire them, or do I work on the side and turn into four years maybe? So, maybe you take a job in a warehouse as an area manager for a few years because you have the skills for that position, and it allows you the time to grow on the side for what you want to do. Hey, this isn’t the military, there is nothing wrong with that, because there is no right or wrong answer…there is no magic bullet!
Don't stress, this is a good thing. They like you!
Before we get into the job offer (and a blog I will cover later), hopefully you have done your homework on your worth within that industry and that location, via numerous methods, that you have applied. You probably gave them a ballpark salary range, or you wouldn't have got this far. Phone screens and interviews went well. You caught the clues they liked you, you got the phone call they want you on-board and now you get the official letter with the details.
Take a pause, let it sit, let it resonate. This is a good thing. After a day or so, come back to the offer letter and look at the details.
1- Salary: You gave them a ballpark figure and they came back with an offer. Does the offer fit this salary range? Is the offer a match for your skill set? Do you have other offers and how does this compare? Have you researched the salary range for this position in your location? This is how you consider the salary.
2- Bonus: Is there a bonus offer? How does this supplement the rest of the package? Think about why. You are in a world of finances and cashflow now. A bonus now may save the company money in one area. It also may look nice up front to you, but is that best for you in the long run? Way the pros and cons of upfront money versus the long haul.
3- Relocation (HOR move): Have you used your Home of Record move? You can leverage that if you have not and instead get more of a bonus or negotiate it into your salary. If not, how far are you moving? How much do you have to move? This is a large cost to organizations, so if you can offset it, it will be a nice bargaining chip. However, you may need it just as much, so something worth considering.
4- Stock options/401k match: Depending on the size of your company, you may or may not be able to negotiate this. Sometimes, private organizations have "stock" options and you may be able to negotiate that. What is the company history and background? What are your short and long term goals? Is money upfront less risky? Maybe the money upfront helps you fund a side hustle.
5- Time off: Similar to 4, may or may not be negotiable. Tread carefully here, coming out the gate asking for more time off may start the buyer’s remorse thinking off the bat.
6- Insurance: Again, similar to 4, 5, may or may not be negotiable. As healthcare costs increase, this is something you may want to seriously look at and consider however. What is your health, the health of your spouse, are you planning on kids, surgeries, etc?
7- Work from home: Have you considered this a benefit? What is it worth to you and why?
1- Have your statistics ready. Have reasons why you are asking for each and be able to support it.
2- Prepare from the starts.
3- Try not to discuss salary until the offer is made...keep it broad.
4- Try not to be the first to throw a number out.
5- Don't try to negotiate if they met all your demands.
6- Be willing to walk away.
7- Don't negotiate until the offer is in writing.
8- Do not haggle. You are not buying used car. Take each category separately for the reason/stats you found.
This is not a store, and you are not bartering. The employer tells you that the annual salary for that position is $150,000, and you thought you deserve more, so you ask for $175,000. The employer expresses the possibility that they may be able to provide $160,000 for the position, then you jump in with $165,000. When he said that $165,000 is already over their budget for that role, you ask for more vacation days.
Let’s face it: this looks tacky. You just made yourself look tacky, cheap… and unprofessional.
How to avoid this mistake: Again, you should have already researched on the salary for that position, and how much budget the company allotted for it. Name your target figure, and ask whether it is within their budget range or not. If they say no, then believe them.
Take this exchange, for example:
Candidate: I am aware that you have budgeted $150,000 for the position. However, I believe that my level of experience warrants a higher rate, should I accept the job.
HR: How much do you have in mind?
Candidate: Can you make it $165,000?
HR: Due to budget constraints and limitations, we can only go as high as $160,000.
Candidate: I see. Then, may I give you my answer on Friday?
You asked for a salary for a reason and a number of days off for a reason, don't be tacky and change it because one area was not met. It isn't really good faith negotiating and looks tacky as stated above.
These are all things to consider when accepting or putting a counter-offer in. And again, relax, they like you and negotiating is part of your life now, after all, you are in the business world now!