In fact, the nearly 1.3 million active members of the military have a special set of circumstances that they have to keep in mind when they’re mapping out their finances. If you’re in one of the military’s seven divisions, you may have to leave your family at a moment’s notice when you’re deployed, with the average tour of duty lasting up to 12 months. Being in the military also means potentially risking your life, which could possibly expose your family to financial risk.

To help you plan, you can take advantage of some key benefits available only to members of the armed forces, including loans, mortgages, retirement plans, insurance, and discounts. Here are some things to keep in mind if you’re in the military and starting to build a financial blueprint.

Create a budget

Whether you’re part of the military or not, the first place to start when planning your finances is with a budget. One budget you might consider is the 50-30-20 one, which requires you to split your monthly income into 50% for your fixed, essential expenses, 30% for your variable, nonessential expenses, and 20% for saving and investing. 

When you’re creating your budget, take note of your regular paycheck, as well as any other income you have, from an approved part-time job or from a military stipend. Remember that if you have a family, you’re eligible to receive a monthly stipend for housing, depending on how many dependents you have. You’ll also receive a separation allowance if you’re away from your family for more than 30 days.

Maybe you’re saving up for a house, an engagement, or to have kids. You may want to prioritize your savings in that case, and allocate more than 20% of your income to your savings, if you’re able to do so.

Protect yourself

As a member of the military, you can protect yourself, your family, and your things with insurance.¹ Having insurance can provide financial security for you and your family should something happen to you. There are military credit unions designed specifically for service members that can help you bank and may get you the protection you need, including Andrews Federal, Navy Federal, Pentagon Federal, Security Service Federal, and the United Services Automobile Association (USAA).  

USAA, for example, offers a variety of services from auto insurance, homeowners insurance, life insurance, loans, brokerage accounts, and more. Navy Federal offers different kinds of bank accounts, credit cards, loans, and more. Before being deployed, you’ll want to make sure your life insurance policy includes an “act of war” clause in case something happens to you, says Brandon Young, a financial planner and the founder of Fulgent Wealth Management, based in Tempe, Arizona. “Many credit unions and military banks offer life insurance during deployment with such clauses,” says Young. 

Before being deployed, you should also call your auto insurance provider and let them know you’ll be away from your car for a while. “Most automotive insurance groups will allow a deployed member to save money on their auto insurance by contacting them,” Young says. “Generally their rate will have been reduced while deployed and sometimes for a few months after. ” 

You should also consider having a power of attorney (POA) document before deploying. A POA  names a spouse or other family member to handle any financial emergencies that come up in your absence.  “One scenario we see often is when a person is deployed and their account has fraudulent activity or some other issue,” says financial counselor Jennifer Stogner from Huntsville, Alabama-based Redstone Federal Credit Union. In that case, having a POA can guarantee that someone will be able to work with the proper authorities to fix that situation. 

Save for the future and retirement

Perhaps one of the most important things you can do is put money away for the future, whether you stay in the military or not. Since you’re employed by the federal government, you’re entitled to a federal retirement arrangement known as a Thrift Savings Plan (TSP). Your TSP is similar to a 401(k), meaning that you’ll contribute pre-tax income to the account and pay taxes when you withdraw from it in retirement.

If you joined the military after January 1, 2018 or if you’re covered under the Blended Retirement System (BRS), which made military retirement plans more similar to civilian ones, the government will match up to the first 5% you contribute to your TSP every pay period. So try to contribute as much as you can to your TSP. Remember that in 2023, you can contribute up to $22,500 to your TSP.

The TSP also allows servicemembers to purchase an annuity, which is a long-term investment handled by an insurance company providing regular payments during retirement. People might choose to purchase an annuity to help protect against outliving their retirement money. It can also ensure that a beneficiary will continue to receive those payments after you pass away. You can find more information about annuities here.

It’s also important to save for emergencies and long-term goals. “Most servicemembers I worked with not only invested in their TSP, but they set aside additional funds within an IRA or a taxable brokerage account,” Young says. Investing some money in the market through a brokerage account can lead to higher returns than leaving your money in a savings account. However, all investing involves risk, and you can lose money. Stash urges customers to follow the Stash Way, our financial philosophy, which includes investing regularly in a diversified portfolio that includes stocks, bonds, and exchange-traded funds.

Capitalize on military discounts 

Your status as a member of the military can qualify you for certain discounts and financial benefits. As an active member of the military or as a veteran, you can have access to loans and mortgages backed by the Department of Veterans Affairs (VA), often with better terms than typical loans offer. Serving at least 90 consecutive days during wartime or 181 days during peacetime allows you to apply for those loans. “Over the course of a conventional 15-to-30-year mortgage, you will save thousands and thousands of dollars,” says Adem Selita, the founder of credit counseling service The Debt Relief Company based in New York. 

You should also always keep an eye out for any discounts for members of the military, Selita suggests. Certain schools, including St. Joseph’s University, Berklee School of Music, California Southern University, and more offer tuition discounts for active duty members of the military and the veterans. You can also get reduced rates from cell phone providers, retailers, amusement parks, and some travel. You can find out about military discounts here.

How Stash Can Help

Stash can help you achieve your financial goals, whatever they look like. With Stash, you can open a brokerage account and start investing small amounts of money in a diversified portfolio.

Investing made easy.

Start today with any dollar amount.

Get Started

The post Planning Your Finances as a Member of the Military appeared first on Stash Learn.

But getting all your spending, financial goals, and investments into formation—well, even an Army general has to make a strategy.

We spoke to Zach Iscol, a former Marine Corps officer and CEO of Hire Purpose, a company that provides personalized career guidance to veterans, military service members, and their spouses, on our podcast “Teach Me How to Money.”

Check out Iscol’s tips on how to focus on the mission at hand: managing your financial life.

Don’t be scared to change jobs

“When you’re in the military, you’re trained to do a job. But that doesn’t mean that’s the job you need to do for life. Spend some time finding what you’re passionate about, and really explore it rather than pigeonholing yourself into one career.”

It’s a marathon, not a sprint

“Success isn’t a football game or a hockey game. There’s no time limit or that you score a touchdown and you’re done. That’s not the way life works. True success comes from discipline, focus, and I think the most important thing is consistency. Are you doing things consistently within a framework with specific objectives and goals in mind? Think about how you can consistently to set yourself up for long-term success.”

Saving a million dollars is within your grasp

“It comes down to consistency. If you are consistently putting money away and you look at compound growth, it is absolutely achievable to retire as a millionaire. But again, do you have the discipline and are you going to be consistent in doing that?”

Finances are a team effort

“When you get married, one of the challenges that you encounter in terms of financial planning and resources is you’re no longer on your own. Even if you’re in a dual-income household, you still have to start making decisions together. You still need to be thinking about the future together. And most importantly, maybe you have children, and now you need to start thinking much longer term about their futures, and how you’re setting them up for success in the future as well.”

Believe in your future

“Think about who you want to be in five, ten years. What do you want your life to be? What are the things that you’re passionate and care about? There are a lot of people in whose footsteps you can follow. Start to chart a course about how you do that, and don’t sell yourself short.”

The post 5 Money Tips You Can Learn From a Military Life appeared first on Stash Learn.

Leave us your review on Apple Podcasts, or wherever you listen to your favorite podcasts.

You don’t have to be in the military to learn valuable lessons about discipline and risk. That said, the military can offer a lot of insights in how to invest for the long-term.

Think about it: The military trains you to identify the desired objective, implement a plan to achieve it, and launch a mission to enact that plan.

When it comes to investing, the lessons are similar. Your objective is to build a portfolio that will help you achieve the goal that you’ve set at the specific time in the future (think retirement, a down payment on a home, or a college fund).

To achieve it, it starts with planning and then following through. Keep your eye on your objective and don’t let emotions get in your way. That’s good advice for everyone.

Investing like a marine

Zach Iscol, the CEO of Task & Purpose, knows a lot about managing one’s money and career after a life in the military. He talks career, investing, and all the ways that getting one’s money life in order is more of a marathon than a sprint to the finish line.

Thanks for listening to Teach Me How to Money. Send us your questions at teachmehowtomoney@stash.com, and we’ll try to answer them in our future episode.

If you like what you’re hearing, leave us a review on the iTunes store, Stitcher, or wherever you listen to your favorite podcasts.

The post Podcast: How to Invest Like a Marine with Zach Iscol appeared first on Stash Learn.

While many military veterans struggle financially when they leave the service, many have succeeded in taking what they’ve learned during their time in uniform and applying it to the private sector.

These days, veterans are founding companies in all sorts of industries, including telecommunications, retail, finance, coffee companies, construction firms, and manufacturing, to name a few.

“Every day I use the lessons and discipline I learned in the Marine Corps. – Bob Parsons, GoDaddy founder

Here are some of the biggest, most successful companies founded by American veterans.

1. Walmart

The country’s biggest private company–and its largest private employer–was founded by Sam Walton. Walton served as a captain in the Army during World War II, from 1942 until 1945, as did his brother and co-founder, Bud, who was a Navy pilot in the Pacific theater.

Walmart (WMT) was started with $5,000 saved from the Walton’s military days, with the original store opening up in Bentonville, Arkansas in 1951.

2. Nike

“Just Do It” could very well be the motto for any military branch, as well as Nike’s slogan. It makes sense then that Nike (NKE), the Oregon-based athletic company, was co-founded by an Army veteran, Phil Knight.

Knight enlisted in the army after graduating from the University of Oregon in 1959, serving one year, and ultimately serving in the reserves for seven years.

3. FedEx

Before getting into the shipping business, FedEx (FDX) founder Fred Smith led an adventurous life. After attending Yale (where he came up with the initial idea for FedEx), Smith joined the Marines and served two tours in Vietnam, and was almost killed during an enemy ambush.

After returning home, Smith raised more than $90 million in venture capital, and FedEx started shipping in 1973.

4. Kinder Morgan

Kinder Morgan (KMI), one of the biggest energy companies in the U.S., was founded by Richard Kinder, a veteran of the Vietnam War. Prior to starting the company with his co-founder William Morgan in 1997, Kinder served in the Army as a Captain.

Before joining the Army, however, Kinder went to law school at the University of Missouri, which allowed him to serve as a Judge Advocate General officer, or a military lawyer.

5. GoDaddy

Web registration company GoDaddy (GDDY) was founded in 1997 by Bob Parsons. Parsons, too, was a veteran of the Vietnam War, having enlisted in the Marine Corps in 1968. While in Vietnam, Parsons became a decorated soldier, earning a Purple Heart, the Combat Action Ribbon, and Vietnamese Cross of Gallantry.

“Every day I use the lessons and discipline I learned in the Marine Corps,” Parsons says on his website. “I absolutely would not be where I am today without the experiences I had in the Marine Corps.”

Want to invest in companies in the defense industry? Check out our selection of single stocks and themed investments on Stash.

The post These Famous, Successful Companies Were All Founded by Military Veterans appeared first on Stash Learn.

That means there are thousands of veterans out there with an array of skills that might help them excel as investors, who may not even realize it.

Think about it this way: The military trains you to identify the desired objective, implement a plan to achieve it, and launch a mission to enact that plan.

Investing is similar–your objective is to build a portfolio that earns a good return for the goal that you’ve set at the specific time in the future. To achieve it, it starts with planning and then following through.

If you’ve mastered the skills below, you’re already ahead of the pack.

Be disciplined.

Many successful investors are disciplined. And luckily for soldiers, discipline is at the very core of military training.

Practicing healthy financial habits, including investing money on a regular basis, is more of a marathon than a sprint.

Applying the rigid discipline of soldiering to your finances is a great way to reframe how you think about money. Knowing when to hold, sell, and how to ride out market waves requires a systematic, disciplined approach.

Do the grunt work.

Investing starts with a planning and research phase that not everyone will find sexy. Luckily, if you’ve spent time in the armed forces, you’re used to tedious grunt work. That’s what researching and planning can sometimes feel like, especially compared to the thrill of simply hitting the “buy” button for a security.

But putting together an investing plan–poring over a fund prospectus, for example–can be far less thrilling. Don’t shrug it off, though. You’ll want to make sure you’re putting your money to work in a way that makes sense for you, at a risk level that you’re comfortable with, and that will hopefully provide a return.

Plan the mission.

Another skill many soldiers pick up during their enlistment is to think critically and strategically. And it’s a strength that’ll go a long way in handling your finances.

Sure, you may spend a good amount of time simply following orders, but you’ll also learn to outline missions and identify objectives. That’s easily applicable to financial planning and investing, which also requires patience, planning, and follow-through.

Set up comms.

If you’ve spent time in the military, you’ve likely had to become a good communicator. Coordination and communicating in a legible, straightforward way is a necessary skill.

You’ll need those skills to able to discuss your goals with your partner or financial advisor. Everyone’s wants, needs, and time horizons are different and there are no one-size fits all plan to get there.

By being able to clearly communicate how you need to change your budget in order to put aside money for your future goals, you can avoid a lot of future problems.

Call for support.

Soldiers know when to call for backup–something that new investors, in over their heads, may not feel comfortable doing.

“Every service has a support agency. In the Navy, it was called the Fleet and Family Support Center, and they had professionals on staff who service members could talk to about finance,” Eric Jorgensen, director of financial planning at Maryland-based Turning Point Financial, tells Stash.

Jorgensen, a 20-year Navy veteran, adds that many service members can be reluctant, however, to use the resources provided to them. “In my experience, it was an underutilized service,” he says “This could have been due to lack of awareness, shame, or ‘no time’.”

There’s no shame in speaking up if you’re unclear about how your money is being handled or if you’re seeing strange fees. Smart investors ask questions.

Make a decision.

Managing your portfolio isn’t always easy, and it isn’t always fun. When the markets are in disarray and you’re trying to decide what to do, it’s important to be disciplined about your decisions. You’d never let your emotions affect your decision-making while in the field. It’s the same with your investments. If you’ve committed to a long-term, buy-and-hold strategy, then you’ll have to stand strong when markets dip.

And that’s what they teach you in in the military, to keep cool under pressure. You may not give it much thought, but decision-making skills are incredibly valuable, in life and when it comes to investing.

The post How to Invest Like a Soldier appeared first on Stash Learn.

“As an investment advisor we see all too often the consequences of those who have not saved often and early enough to build up for retirement,” Eric Nager, an investment advisor with Southern Capital Services, and a retired lieutenant colonel in the U.S. Army Reserve tells Stash.

Whether you plan to re-enlist until you hit retirement age, or transition to the civilian world as soon as your enlistment is up, it’s a good idea to start planning for retirement right now.

Why is it so important? You can’t expect your pension to support you for the rest of your life. If you qualify for one at all, you’ll likely to need more than you think.

Whether you’re an E-1 private or a 4-star general, here’s what you can do now to start planning for retirement.

1. Start saving, and stop spending

The most significant thing you can do (whether you’re in the military or not) is to put a budget together and control your spending.

“Many enlisted military (members) join straight from high school and have little to no experience with a budget or tracking their spending,” says Eric Jorgensen, a 20-year U.S. Navy veteran, and director of financial planning at Maryland-based Turning Point Financial.

“Many of us purchased sports cars, putting us into a position where we were living paycheck to paycheck.” 

“When I was active duty the Thrift Savings Plan [The military’s 401(k) equivalent] didn’t exist, and commands didn’t spend much time educating us about finance,” Jorgensen says.

As a result, many of his colleagues overspent, which put them in a position of living from paycheck to paycheck. Get a grasp on your spending habits, and start planning for the long-term sooner rather than later.

2. Maximize and take advantage of your benefits

Military members can access a number of benefits that aren’t available to civilians. So if you’re currently enlisted, or a veteran, it’s worth familiarizing yourself with what’s available.

The Servicemembers Civil Relief Act, for example, offers financial protections for those who are deployed, including stopping repossessions and preventing evictions.

There are also federal programs that help with tuition assistance, home loans from the Department of Veterans Affairs, and high-interest savings accounts while members are deployed. The Department of Defense’s Savings Deposit Program is one example, that’s a savings account offering interest rates up to 10%.

3. Consider signing up for military retirement plans

Just like in the private sector, the military has savings and retirement plans that soldiers can opt into. And you don’t want to forget about those.

The main plan is the Thrift Savings Plan, which is similar to a 401(k) for service members.

“While the choices in [TSP] are not outstanding, mostly limited to index and target date funds, it is still a way for service members to put away a portion of their earnings on a pre-tax basis,” Nager says.

The military, traditionally, had a pension system that kicked in after 20 years of service. But as of the beginning of 2018, that system has been revamped into the Blended Retirement System, which, as you may have guessed, blends the old pension system with the BRS. The BRS adds a contribution requirement to the pension system.

4. Think beyond your enlistment

The vast majority of servicemembers will leave the military at a relatively young age, typically in their early to mid-twenties. That means there’s an awful lot of “life” left before retirement, and that soldiers will need to find employment outside of the military.

You’ll need to consider your financial needs beyond enlistment. Even if you’re still eligible for the military’s pension plan, you’re likely going to need to continue earning money to save for retirement. The net value of a pension is roughly $200,000 for an enlisted soldier, and $700,000 for an officer, which isn’t enough to cover the average expected retirement.

Most soldiers don’t spend decades in uniform, and only around 20% end up qualifying for a military pension. So, like civilians, members of the military can make the most of their earnings by saving and investing early and often.

It may also be a good idea to begin contributing to an IRA, in addition to your TSP.  Your money can grow tax-deferred and offer you another valuable nest-egg for your later years.

The post In the Military? Try These Tactics to Save For Retirement appeared first on Stash Learn.

Not only is the prospect of a seven-year stint in the armed forces daunting enough, but wrangling the rest of your life into order–your finances, in particular—can add an extra degree of difficulty.

And by the time you’re ready to hang up your boots and retire, or otherwise move on to civilian life, soldiers have other things to consider. Should you stick it out and earn a pension? Or go back to school and earn a degree?

There are many viable paths after serving in the military, but if you want to leave the service with a sense of financial security, you’ll probably want to consider what you’re facing during each phase of your enlistment.

Here are some of the major money challenges that soldiers experience during those phases, from conscripts to commanders, and some tips to help you work through the financial bottlenecks at every stage of your service. Keep in mind that these are only tips, however, as every soldier’s experience is going to be different.

Recruits

As a recruit, you should expect money to be tight—you’ll be earning less than $20,000 per year in base pay as a private at the E1 rank, according to the Department of Defense. For that reason, probably the most important thing you can do is to make a budget, stick to it, and establish healthy money habits.

Also, if you’re packing debt, keep up with your bills. Debt doesn’t disappear just because you’ve joined the military, and ignoring it is only going to hurt you in the long run.

“The number of people joining the military with student loan debt is increasing. The number of [military members] with large student loan debt and no degree to show for it is also increasing,” Lacey Langford, a financial advisor, veteran, and founder of North Carolina-based advisory Sage Services, tells Stash.

Young recruits should also be wary of predatory financial products targeting military members. You’re likely to be offered all sorts of high-interest loans and be tempted to make big purchases, like a car or a house. Stick to your budget, make sure you understand the terms of any loans you take out.

Also, you’ll want to check out the military’s available retirement programs, including the pension system and the Thrift Savings Plan (TSP), which is similar to a 401(k) program.

Mid-career soldiers

After a few years in the military, the pay scale ramps up. So, the good news is that your paychecks will be a bit bigger and you’ll have more resources to work with. The bad news, though, is that a military career could start to take a toll, with frequent relocations and deployments.

If you’re deployed, unforeseen issues can arise with family members. “When one spouse is away, all the burdens of running a household, (including) child care, fall on the other,” investment advisor and U.S. Army veteran Eric Nager, of Alabama-based Southern Capital Services, tells Stash.

“Deployments can also create a time-warp effect, making it easy to lose track of when bills are due,” Nager says.

“(Deployment) can be tricky when banking systems, time zones, languages, and postal services are different from home,” Nager says.  “If families fall behind, they can be assessed late fees or other unnecessary charges.”

Leaving the service

If you worked for the service for 20 years or more, you’ll qualify for a pension. But most soldiers leave long before that.

So, for most soldiers, getting all of your financial ducks in a row in preparation for a career in the private sector is a good first step. However, many soldiers struggle with two aspects of their new life: Losing a steady, reliable paycheck, and finding a job.

That can make it tough on family members, who rely on soldiers’ earnings. And not just immediate family members; Many soldiers help out extended family, too.

“For many service members, they are the highest earning person in their family,” said Langford. “Because of this, many of them are overextending themselves to help family members out.”

Once out of the service, many veterans have trouble finding jobs. There are a number of reasons why including skill mismatches and stereotyping of service members—many employers don’t understand how military service translates to their needs.

Re-enlistment?

What about re-enlisting? Bonuses typically abound for those willing to extend their time in the armed forces, and the armed services often use them to keep trained soldiers in the ranks. But the military’s retirement system (pensions and the TSP) is generally the primary motivator for keeping soldiers enlisted. The Defense Finance and Accounting Service says that accruing 20 years of honorable service—no less—is the only way to qualify.

The net value of a military pension is roughly $200,000 for an enlisted soldier, and $700,000 for an officer, making it a powerful incentive.

No matter what stage you’re at, the best day to start saving is likely today.

The post In the Military? Tips For Saving Money at Every Stage appeared first on Stash Learn.

The Spartans and Mongol hordes of ancient times were embroiled in conflict—their cultures were defined by it. That’s a far cry from modern America, where only 3.5 million, or roughly 1%, of the population, are members of the military or Department of Defense.

Though a relatively small number of people actively suit up as members of the U.S. military, the costs of outfitting them have increased substantially over the years.

While a Spartan warrior needed only a spear, helmet, and shield to go to war, modern soldiers are equipped with much more than that; And often enter the battlefield in vehicles or aircraft that cost millions, if not billions of dollars.

To put it another way, modern defense is big business. It’s not merely banging on a piece of steel to produce a sword anymore. It involves researching and developing aircraft, satellites, and ever-bigger weapons.

And if President Trump is serious about getting his space army, he’s going to rely on that very same industry to get it.

What is the aerospace and defense industry?

The aerospace and defense industry comprises companies that produce aircraft and spacecraft for both military and civilian use. It also includes manufacturers of military equipment, vehicles, and weapons, such as missiles and bombs.

It does not, however, include companies that manufacture or sell guns and ammunition for hunting and recreational use. It also excludes companies engaging in non-aviation related commercial services at airports, like restaurants and shops.

Even excluding those industries, aerospace, and defense is a prodigious industry that employs tens of millions of Americans and drives billions of dollars in revenue every year.

16% of the national budget, or more than $600 billion, goes directly toward defense and homeland security-related activities. Most, if not all of that money ends up going to companies in the defense industry.

In 2016, the sector employed 2.4 million people in the U.S., and generated $872 billion in sales.

Though there are hundreds of active firms, some of the sector’s largest companies include Boeing, Lockheed Martin, and Northrop Grumman.

The American taxpayers pour an enormous amount of money into the defense and aerospace sector. While a lot of that money seemingly disappears into a black hole (literally, perhaps—you never know what DARPA is up to), a lot of it goes toward developing products and technologies that directly benefit the public.

So, what does the sector actually produce? Perhaps the easiest way to break it down is like a Navy SEAL: By land, air, sea, and beyond.

Land

While aerospace companies mostly operate in, well, the air and in space, defense companies produce all sorts of terrestrial weapons and technologies.

For example, military and defense contractors play a huge role in shoring up our national security measures, and the fact that most of America is relatively safe is due, at least in part, to these companies.

They build military bases and facilities to defend the borders, tanks and related vehicles for the military, and other arms and weapons.

Air

Defense and aerospace companies are always hard at work on next-generation fighter jets and military aircraft. They’re also churning out orders for the U.S. and other militaries, too.

One example is the current-gen Lockheed Martin F-35 Lightning II, which can cost more than $122 million per plane. Another is the General Atomics MQ-1C Gray Eagle, an unmanned aerial drone made by General Atomics for the U.S. Army at a cost of around $31 million per unit.

But while they do design and sell weapons and military equipment for governments, companies like Boeing also build airplanes for commercial enterprises, too.

Airplanes, for example, have become more efficient over the years. This has led to cheaper airfare and shorter trips.

Sea

Don’t forget about the ocean, which is not only incredibly important for national defense, but is rife with resources and is perforated with valuable trade routes. While most of our battles are fought on land and in the air, the ocean is still the world’s biggest freeway for international trade.

And while it may not seem like much has changed in ship or seafaring technology over the years, defense companies are hard at work creating next-generation ships and floating fortresses with which the U.S. and other countries can engage in military operations.

A prime example is the Navy’s newest aircraft carrier, the USS Gerald R. Ford, which was commissioned in July 2017. The nearly $13 billion ship is the world’s largest aircraft carrier and will carry the F-35 fighter jet, among others.

Space

While there’s still a need for classic military and defense equipment, the future of the sector may lie far beyond the sky—in outer space.

The U.S. and other countries have traditionally used public funds to pay for space travel and exploration, but we’re starting to see more private capital and investment enter the market.

Companies like Blue Origin and SpaceX, both founded by billionaire businessmen, are becoming integral parts of the American space program, and could soon start ferrying paying passengers past the stratosphere and into orbit.

There are also national security implications, as President Trump recently laid out in his idea for a space-based branch of the military, which could further increase public investment in the sector.

The sky may be the limit for some industries, but this probably isn’t one of them.

Want to explore the world of aerospace and defense? Check out these sector-related funds and single stocks available now on Stash.

The post What is the American Aerospace and Defense Industry? appeared first on Stash Learn.

Trump’s moonshot idea

Trump shared his moonshot idea of a sixth military branch for the first time in March during a speech in San Diego.

“My new national strategy for space recognizes that space is a war-fighting domain, just like the land, air, and sea,” Trump told a crowd of Marines during a March speech, according to reports. “We have the Air Force. We’ll have the space force.”

He recently rekindled the idea while welcoming the U.S. Military Academy’s football team to the White House. Aside from the basic concept of putting the military in space, little else is known about Trump’s proposed “Space Force.”

The military in space

While the president, at first, insisted that the idea was a joke, it’s unclear how serious he is about sending troops past the stratosphere. While outer space has traditionally been NASA’s domain, the military does have a history with the heavens.

“We have the Air Force. We’ll have the space force.”

Starting in the mid-1980s, the Air Force Space Command, also known as U.S. Space Command, has been the military’s primary conduit to extraterrestrial operations. That mostly includes the launching and operation of satellites.

If the U.S. has anything resembling a “Space Force”, then this is it—though it lacks rail gun-toting space soldiers and orbital howitzers. U.S. Space Command has probed the idea of a “Space Mission Force,” which would “prepare and present space forces as a ready force capable of operating in a contested, degraded and operationally-limited environment.”

Aside from that, the only known military space operations involve the Air Force’s one known spaceplane, the X-37B, which is unmanned and has only flown a handful of missions.

Houston, we have a problem

There are a few reasons Trump’s plan may have trouble getting off the launch pad.

First, the U.S. signed the Outer Space Treaty in 1967, which attempts to prevent countries from using outer space for “military purposes.” The treaty acts as a basic legal framework for international space law, and 105 countries are currently parties to it.

Second, the idea has to jump Congressional hurdles. The concept was actually included in the 2018 Defense authorization bill—it would have created the U.S. Space Corps, taking over the Air Force’s current space-based missions—but was given the thumbs down by lawmakers.

Finally, the Air Force has to be on board, which at the moment, it is not. When reporters asked Air Force Secretary Heather Wilson about the idea, she said that “The Pentagon is complicated enough.”

Sky-high costs, astronomical profit

Perhaps Trump’s biggest obstacle is finding a way to fund a new, space-based military branch. We don’t know what it would cost, but building an entire branch geared for zero-gravity combat would require an incredible amount of investment.

The closest thing we have for comparison is probably the creation of the Department of Homeland Security in 2003, which launched with 180,000 employees and a budget of $37.7 billion. The DHS’ most recent budget is around $70 billion.

The operating budget for a military branch is much higher, however. The 2019 budget request from the Air Force, for example, calls for more than $150 billion.

Who would benefit from a “Space Force?”

In the end, though, the creation of a “Space Force” would be a windfall for military and defense contractors—and, in turn, their shareholders.

The Department of Defense awards hundreds of billions of dollars in contracts to private corporations every year, for research, developing, and producing weapons. Companies like Lockheed Martin and Boeing are usually among the biggest recipients.

And a new branch of the military would require a lot of equipment—much of it incorporating new or yet-to-be developed technology to address the needs of extraterrestrial combat.

The post President Trump Wants to Add a “Space Force” to the U.S. Military appeared first on Stash Learn.

If approved by regulators, the multi-billion dollar deal would instantly boost Northrop’s missile-making and deterrence capabilities as competition heats up in the defense industry, and as North Korea continues flexing its might by testing intercontinental nuclear missiles capable of reaching the U.S.

Space: the next frontier

Orbital manufactures aerospace equipment, including missiles and propulsion systems, armament systems and ammunition, as well as satellites and other space components. Space is expected to be the next big frontier in defense technology, according to experts.

Northrop announced it had been awarded $328M contract from the Air Force to construct a missile deterrent shield

More specifically, by purchasing Orbital, Northrop will add to its missile-defense capabilities, the Wall Street Journal reports.

Northrop is one of the largest defense companies in the world, and one of the biggest contractors for the U.S. Department of Defense. In August, Northrop announced it had been awarded $328 million contract from the Air Force to construct a missile deterrent shield.

Competition heats up

Northrop is also reportedly vying with defense giant Boeing for the development of a ground-based missile deterrence system, and the potential acquisition comes at a time when merger and acquisition activity in the defense industry has reached record levels.

“The acquisition of Orbital ATK is an exciting strategic step as we continue to invest for profitable growth,” Wes Bush, Northrop’s chief executive officer said in a press release.  “Through our combination, customers will benefit from expanded capabilities, accelerated innovation and greater competition in critical global security domains.”

News of the acquisition talks sent Orbital stock up 20% on Monday.

More acquisitions

Earlier in September, competing defense company United Technologies said it would acquire aviation company Rockwell Collins for $23 billion, the largest acquisition that United Technologies has ever made.  

Pending regulatory approval, the tie-up of United and Rockwell would create one of the largest aerospace manufacturers in the world, according to industry analysts, and it would rank as the largest aerospace acquisition on record, according to the Wall Street Journal.

Top takeaways

The aerospace and defense industry is undergoing a wave of mergers and acquisitions, of which Northrop Grumman’s plans to acquire missile and satellite manufacturer Orbital ATK is just the latest.

The tie-up of Northrop with Orbital will boost Northrop’s missile defense technology following a contract with U.S. Air Force to continue building anti-missile technology. The news comes as North Korea continues testing intercontinental ballistic nuclear warheads capable of hitting the U.S. mainland.

The post Northrop’s Acquisition Will Boost Its Space Capabilities appeared first on Stash Learn.

May is Military Appreciation Month, so we took a deeper look at the thousands of Stashers on our platform who are in the armed forces. It turns out that military Stashers are fantastic investors. In fact, they’re more disciplined investors than the average Stasher.

Military Stashers are great at Auto-Stash

Auto-Stash is a feature that allows Stash users to invest automatically, picking a certain amount to invest, and the frequency with which they would like to make the recurring investments.

Previous data analysis has shown that Stashers with Auto-Stash on have almost triple the savings after one year than a Stasher without the feature turned on.

“We found that our military Stashers are almost twice as likely to use Auto-Stash,” said Michael Gartner, Stash’s in-house data scientist.

Long term investors

Military Stashers are also more likely to be investing for the long-term. Stash is about investing, not trading. Military Stashers are doing just that, indicating that they intend to use their investments further into the future than the average Stasher.

Stashing younger

The average military Stasher is only 27 years old, compared with the average Stasher, who is 30. Why is that three years important? Despite being an average of three years younger than the average Stasher, military Stashers are proving themselves to be savvy, thoughtful investors, ahead of their years, and their nonmilitary peers.

Military Stashers are more likely to invest for the long-term.

“It was amazing to find that, despite being younger, on average, our military users are exhibiting great investing behavior,” Gartner said. “Overall, when you look at the numbers, they are better Stashers, and at a younger age, which means that their future as investors is looking pretty bright.”

How are military Stashers investing?

To start, military Stashers are investing in the Mixes, Blue Chips, Delicious Dividends, and Roll with Buffett, all investments that are popular across the platform with all Stashers.

However, military Stashers are slightly more likely to invest in Aggressive Mix than your average Stasher, and seem to be favoring American Innovators more than the average Stasher.

They are also putting their money where their morals are. They are 8% more likely to be investing in Defending America than their civilian counterparts.

Thank you for being such amazing investors, and for choosing Stash as part of your financial journey.

The post Stashing While Serving: Military Stashers Are Saving Beyond Their Years appeared first on Stash Learn.

The post Talk Money to Me: Military Money Coach Helps Spouses Save appeared first on Stash Learn.