Hippie Green Beret

The Path to Freedom & Unconventional Wealth

Free Foot Powder & Old Man Money

by HippieGreenBeret

When I was a Noob in basic training the Army bared its soul.

Taking care of your feet is super important. They drill it into you. Change your socks. Powder your feet.* So in their unbeknownst-to-me-yet-wily-ways, we were offered free foot powder. And the docs mumbled something about a double blind test. Everyone was tired and the foot powder was free, so a lot of guys took it without question. I didn’t. And during the mandatory breaks, we changed socks, and powdered our feet. I watched others with their free foot powder, guardedly jealous. About halfway through the full day march, some folks started complaining of their feet being hot. Like really hot. But the weather was really hot, so it seemed normal. Every hour or so, we stopped, changed socks, and powdered our feet. We walked for hours.

Turns out, volunteers either got the “new and improved but yet to be tested on humans” foot powder or the “kind you buy at the local store and it won’t burn your feet into to a red scaly mess and make you look like you’re wearing blister socks” type of foot powder.

It just got serious.

Speaking of Retirement…do you think DFAS (Defense Financing Accounting Service) and the Department of Defense phased out the traditional military retirement system (do 20 years, earn half your base pay) and set up blended retirement to benefit the service member??? Think foot powder.

Things just got Real in the Whole Foods parking lot. And you are responsible for yourself. But fear not, HGB knows that you are becoming more and more self sufficient with every article you read on here!

Conventional Advice

Conventional advice recommends investing 10% of your paycheck in an IRA. It might work out for you if you started as a 20 year old and want to wait till you’re 65. But, if you partied like a rock star and now you’re 30 (or older) and wondering what you should do… well, pay attention.

Old Man Money

You’ve got to get your old man money straightened out.… Here’s what you need to do:

  1. Sign up for the Thrift Savings Plan (TSP). Max out your ROTH first ($19,500 for 2020), or contribute as much as you can until it hurts.** Utilize the built-in Lifecycle Funds (i.e. L 2050) – which automatically adjusts asset allocation and diversifies based on your age. Or, if you want to do it yourself, utilize C, S, I, and F Funds in a 50% / 15% / 25% / 10% spread and rebalance yourself when they get out of whack.
  2. Individual Retirement Account (IRA). Go to Vanguard.com. Open a ROTH IRA. Max out your ROTH IRA ($6,000 for 2020). Use Target Retirement Funds (i.e. VFIFX) which… you guessed it… automatically adjusts asset allocation and diversifies based on your age. Or do it yourself, with something like the Cadillac Fund. If you’re married, set a ROTH up for your spouse*** and max it out.
  3. If you’re not in the military or work for the Fed… use your company’s IRA – $19,500 is the max. Just make sure you’re buying a Total Stock Market type fund with a low expense fee (less than 10 basis points … i.e. .10%).
  4. If you work for yourself, you can do a SEP IRA, which you cannot exceed the lesser of 25% of the employee’s compensation, or $61,000 for 2022.
  5. There’s also a SIMPLE, Self Directed, 457, and 403(b). Personal Capital does a good job explaining Different Types of Retirement Plans on their site.

What is the takeaway?

Take care of yourself. Get your OLD MAN MONEY in order!

*Other notable mentions… Keep your feet clean. Take care of hot spots before they become blisters. When you get a blister, drain it with a sterile needle (use lighter to sterilize safety pin, which you can store on the inside of you hat for easy access). Air your feet out (sunshine is best) to avoid trench foot.

**Why not Traditional IRA/TSP (i.e. poor man’s savings account)? Because Traditional IRA / TSP lowers current tax bracket and gets taxed later at income tax bracket levels, not long term capital gains / qualified dividends rate. If you’re in the military, most likely you do NOT need to lower your tax bracket. It’s already low. Make sure you max out ROTH IRA first – it grows tax free, no RMDs, and you can take it out tax free.

***This is especially true if your spouse is not in a paid job… and you love them.