MakingCents Podcast

[MUSIC PLAYING] EMILY BIGHAM: Hi, and welcome to the podcast, "Making Cents," brought to you by Navy Federal Credit Union. I'm your host Emily Bigham. And each week, I'll be taking your questions to the experts to help you make cents of your money, pun intended. On this first season of "Making Cents," we're making your financial health our mission. So what does this mean? Well as members of the military, veterans, and family members of those who serve, financial help can mean anything from rethinking your budget as you transition from active duty to civilian life or figuring out the right mortgage for you or whether it's even the right time to buy a home. It can also be discussing how to have the money talk with your family. 

I'm a Navy brat from Coronado, California. And growing up, I experienced firsthand how the military lifestyle can make basic finance questions a bit more complicated. On the podcast, we'll be giving tips and tricks like what credit cards to use overseas to avoid extra fees. Is that the right time to buy a home? If so, which mortgage product should you choose? And as a service member, what are your special benefits, such as the VA loan? 

And as your host, it's important to me that I'm asking the right questions on your behalf. So let me know what topic should we cover? What keeps you up at night? Email me, Emily Bigham, at makingcents@navyfederal.org. That's M-A-K-I-N-G-C-E-N-T-S @navyfederal.org. And make sure to subscribe to "Making Cents" wherever you get your podcasts. 

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Hello, and welcome back to "Making Cents," a podcast brought to you by Navy Federal. I'm your host, Emily Bigham, and today we're going to be talking about savings products, but specifically saving for the holidays. Today we have Jaspreet Chawla on the podcast. Welcome, Jaspreet. 

JASPREET CHAWLA: Thank you, good morning. 

EMILY BIGHAM: Thank you so much for being here. Good morning. Jaspreet is the head of our savings products department here at Navy Federal. So the perfect person to talk to you about this. Now I'm going to throw a little curveball at you, how has your morning routine changed since we've all been at home, working from home? 

JASPREET CHAWLA: Oh, I am loving my morning routine. It's letting me sleep in. So I get about 30 to 40 minutes of extra sleep because I'm not sitting in traffic. And if I do end up waking up early still, I can go for a quick morning run. So I'm loving the change in the mornings. And it puts me in a really, really good mood. 

EMILY BIGHAM: Good. Yeah, I can tell. Very cheery this morning. 

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And I love the 30 to 40 minutes. It's so specific, but it's so important. Just that little extra bit makes such a difference. 

JASPREET CHAWLA: Yeah, it makes a big difference. Yup. 

EMILY BIGHAM: Awesome. All right. Well do you want to talk a little bit about what you do here at Navy Federal saving's department? 

JASPREET CHAWLA: Sure. Absolutely. So as you mentioned, I'm managing the savings products division. With that comes all our deposit products. So checking accounts, savings, MMSA's, IRA's, certificate products, pricing of those products, and then the operations involved with it, and the data and the analytics. I've been with Navy Federal for 20 years. I know, it seems like such a long time, but time truly has gone by really, really fast. I am new to my role. I just moved over to savings products about a year ago. 

EMILY BIGHAM: Congratulations. 

JASPREET CHAWLA: Thank you. 

EMILY BIGHAM: So before we get into the savings products, and I want to specifically talk about the holidays coming up, we're in an interesting time right now. There's some economic uncertainty. And do you have any tips for how consumers can, I guess, take advantage of the holiday season without having to spend too much money? 

JASPREET CHAWLA: Absolutely. I mean, sales is the number one thing that comes to mind, right? Shopping sales-- and you can do this online, a lot more folks are doing this online nowadays, is always a good idea. And then getting your shopping done. Cyber Monday's, a lot of the merchants are pushing for shopping prior to Black Friday. So you're going to see in the upcoming weeks a lot of activity online. So I would take advantage of that. 

But just be careful to not use sales as an excuse or as a reason to make unnecessary purchases, right? As you mentioned, Emily, we're in a time of a lot of uncertainty. So we want to make sure that we are purchasing and enjoying the holidays within our means. Another good strategy, especially during this time is if money is tight for you and your loved ones, reach a consensus amongst your friends and family, right? Maybe do a budget allocation that all gifts must be purchased up to X tag amount, whether it's $35, $50, whatever your budget allows. 

Or perhaps, you do a secret Santa and you only have to purchase one gift in a group of your friends or amongst your family members. So I'd say think about getting creative. 

EMILY BIGHAM: I do love a good secret Santa. We've done that before here at Navy Federal and teams in the past year. And so, you did mention budget allocation. And on the podcast, we like to talk about how to make our money go further. Has there been a time when you went the homemade gift fruit? 

JASPREET CHAWLA: Absolutely. And I'm actually doing that even this year. So I love drawing. So what I'm doing is for all my friends, I'm doing an art piece for all of their homes. So just something small that I will give to them. And then I also have taken up knitting. And I know a lot of folks are in a similar place like me because we have some time because we're not on the road getting frustrated with our commute. So we have some extra time, so I've taken to knitting. And I'm knitting scarves for a couple of friends. 

EMILY BIGHAM: That's amazing. Next time you can bring me one. 

JASPREET CHAWLA: Sure thing, sure thing. 

EMILY BIGHAM: I'm just kidding. 

JASPREET CHAWLA: So I would say, look at what you can do because people do appreciate those personalized gifts a lot. So you don't always have to spend the money. 

EMILY BIGHAM: That's true. I love that. And it just reminds me of feeling cozy at home. And it's something that when people wear it, they think of you. And that sometimes just goes along a long way. 

JASPREET CHAWLA: Yup. 

EMILY BIGHAM: So let's get into some savings products and some tips for holiday shopping. Recently, we were talking about savings products. And I mentioned a story about how my nanny used to get us different certificates or bonds when we were younger. And we would be like, oh, it's a piece of paper. 

JASPREET CHAWLA: That's a smart nanny. Yes. Yes. 

EMILY BIGHAM: I know. Now we thank her. So are there any other tips like that? 

JASPREET CHAWLA: I would say-- right. So I've done the same route with a couple of my nieces and stuff who were younger. And so when you're thinking about giving gifts, think about something that can go a long ways for those folks as well. So I have done certificates for my nieces, and even my own kids. 

EMILY BIGHAM: So how do those work exactly and where do they go? So, for example, if I'm a child and I open it up and I see this bond, like what happens? Is it in the ether? And then how do you take advantage of it and when can you take advantage of it? 

JASPREET CHAWLA: So opening a certificate is as easy as going on your online or mobile application, going to Navy Federal and looking at how long do you want to save your money, right? So what's the time that you don't need to touch this money. And so for holiday spending, let's say if I was trying to save for the holidays, I would open a certificate, perhaps, springtime, right? And do a certificate for six months. Those six months, my money's working harder for me because it's earning interest. Instead of letting it sit-in a savings account or a checking account, which also earns interest, but certificates generally offer a higher interest. So your money is working harder for you. 

And then when your term ends, you should think about liquidating it if you really need the funds. And if you don't, you can continue to roll them over into another certificate product. And so, I say certificates are the best way to kind of plan for the future. And you do a laddering of sorts. So if you're planning for the holidays and you start saving six months early, do a six month certificate. If you're planning for a vacation that you know you're going to be taking a year from now, you might want to do a 12 month certificate. Or do a six month and then roll it into a six month because you didn't need the funds. So there's a lot of opportunities to make your money work harder for you, I would say. 

EMILY BIGHAM: And thinking about that time line, it almost sounds like right now when we think about saving for the holidays. It's almost like we should start saving for next year's holidays with the six month and the 12 month timeline. 

JASPREET CHAWLA: Yeah. Absolutely. The sooner you start, the better position you're going to be in. 

EMILY BIGHAM: And then thinking about these holidays and just given the situation that we're all in, is there any spending habits or anything that you've changed to make your money work for you? 

JASPREET CHAWLA: Absolutely. So I was where Stitch Fix fan. So I would get a monthly subscription of Stitch Fix. And so, that's a clothing package that I would get. It would have five things that I would get to pick and choose what I wanted to keep. Well since March since I've been working from home, I've kind of canceled all my Stitch Fix subscriptions, delayed them because I'm not in need for new clothes. I'm not coming into work every. So I would say that's a change I've made. Also, not going to Starbucks every day, right? And that $5 spent-- 

EMILY BIGHAM: I'm going every day. No, I'm kidding. 

JASPREET CHAWLA: That $5 spent at Starbucks daily does add up if you think about it, right? 

EMILY BIGHAM: Yeah. 

JASPREET CHAWLA: My $0.50 coffee cup at home or $0.20 coffee cup at home compared to $5 a day, I'm saving $25 a week. And then what I've started with my husband lately is we used to order out twice a week for dinner. So I'm not ordering out because it's just easier for me to cook at home and I feel more safe cooking myself. And so, I'm taking that money that we would normally be paying for carry out and putting it to the side as well. And that's my spend bucket for holidays and things like that. 

EMILY BIGHAM: Right. That makes a lot of sense. Something I've noticed, a lot of the subscriptions that I have, like gym subscriptions, or you mentioned Stitch Fix, those types of things, that's hundreds of dollars a month that I'm now saving. 

JASPREET CHAWLA: Yeah. 

EMILY BIGHAM: And so I've been setting up just monthly from my checking into my savings account. And a lot of the gyms pause the accounts, but I just ended up just canceling them because you just don't really know. 

JASPREET CHAWLA: You don't know where we're going back. Yeah. 

EMILY BIGHAM: I think it's also important too, if you do see charges like that I think you can probably call the companies and see if there's anything that they can do. Because every dollar counts. 

JASPREET CHAWLA: Every dollar counts. And then right, CD's you can usually open a certificate with $50. So take that $50 and open a certificate for your son. Take a $50 and open a certificate for your mom or your dad or your siblings. 

EMILY BIGHAM: Or even cutting back. And it's funny because you mentioned Starbucks, and that really adds up. But for me, I went from maybe going out to dinner, and instead I'm going on morning walks with one of my friends who actually works here at Navy Federal. And then at the end, we get Starbucks. So instead of a $20, $30 dinner, we're just getting like a $3 or $5 Starbucks in the morning. And then you're also getting to spend quality time. So reallocating funds and being able to save money here and there, but still being able to spend time I think is really important. All right, great. So I know that you do have two boys at home. 

JASPREET CHAWLA: Yes, Ma'am. 

EMILY BIGHAM: Any special plans for the holidays? Or have you guys thought about gifts or anything like that? 

JASPREET CHAWLA: So my two boys are, I would say, grown men at this point. And they will be home. And I was just talking to the older one yesterday. And I said, hey, do you want to go somewhere? He's in med school so he only gets limited time off. And he said, no, Mom. I just want to be home. I just want some family time because he's had to go back to college for studies and stuff. So right, we're just going to be enjoying the holidays as much as we can and spending quality time together. 

In terms of gifting, I think we're going to just-- gift is going to be they're going to make me breakfast one day. Or they'll make dinner one day. We'll do the best we can given current circumstances. 

EMILY BIGHAM: Well, that's great. I love that. So just to recap a few things that you mentioned, going into the holidays there are going to be a lot of great sales. And most of them are going to be online and digital. 

JASPREET CHAWLA: Yeah. 

EMILY BIGHAM: So make sure you have a plan. 

JASPREET CHAWLA: Absolutely. 

EMILY BIGHAM: Think about your budget. And then also make your money go further for you. So think about a secret Santa, or you mentioned that you're going to be drawing. 

JASPREET CHAWLA: Yup. 

EMILY BIGHAM: Just so crafty. I love that, I wish I had that. And then we talked a little about the savings products. And given the timeline of six months or 12 months, start saving now for next year's big events. It doesn't just have to be the holidays, it can be any type of vacation or major purchase. 

JASPREET CHAWLA: Especially given that we've all been in the pandemic environment. Most people haven't taken a vacation, right? So you know that when this is over and it's safe to get out, a lot of folks are going to want to take that vacation. So start putting away that money now and put in a certificate for six months, nine months, 12 months. There's so many different terms out there. And just let it sit there. It's in an account, you'll get a penalty fee, so there's a deterrent there and you won't likely go touch it because you don't want to pay a fee to take that money out. But set it aside, forget about it, leverage it when the pandemic is over as you need it. 

EMILY BIGHAM: Is there a minimum amount? 

JASPREET CHAWLA: For the certificates at Navy Federal? 

EMILY BIGHAM: Mm-hmm. Start saving. 

JASPREET CHAWLA: For certificates, you can start as low as $50 at Navy Federal. 

EMILY BIGHAM: Wow, OK. So it sounds pretty doable for most people. 

JASPREET CHAWLA: Yeah. 

EMILY BIGHAM: Great. Well, thank you so much for coming in today. 

JASPREET CHAWLA: Absolutely. 

EMILY BIGHAM: And can't wait till next time when you bring me a scarf. 

JASPREET CHAWLA: Yes, Ma'am." 

EMILY BIGHAM: Just kidding. 

JASPREET CHAWLA: Have a wonderful day. 

EMILY BIGHAM: Thank. You too. Thanks again for tuning in to "Making Cents," and make sure to subscribe wherever you get your podcasts. 

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VOICEOVER: Navy Federal Credit Union is federally insured by the National Credit Union Administration. This podcast is intended to provide general information and shouldn't be considered legal, tax, or financial advice. It's always a good idea to consult a tax or financial professional for specific information on how certain laws may apply to your individual financial situation. References to and participation with the military community does not constitute organizational endorsement. Navy Federal is a equal housing lender. 

VOICEOVER 2: Navy Federal Credit Union. Our members are the mission. 

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[MUSIC PLAYING] EMILY BIGHAM: Hi and welcome to the podcast Making Cents brought to you by Navy Federal Credit Union. I'm your host, Emily Bigham, and each week I'll be taking your questions to the experts to help you make sense of your money, pun intended. 

ROBERT FRICK: Well I gave my usual commentary on GDP this morning and it was good, I thought. I worked on it sober and all. Then I just kind of unleashed. I tweeted on Twitter-- I unleashed a tweet and it's kind of taken off. And it's basically-- before everybody pats themselves on the back for having a great third quarter, it's because we spent trillions of dollars. And the Fed opened the spigots to all this money and that's how we made it back in the third quarter. So, you know-- 

EMILY BIGHAM: Yeah and-- 

ROBERT FRICK: We're still not walking on our own yet. 

EMILY BIGHAM: Right, it's so interesting too to read those reports and to think about it from a regular consumer reading it versus someone who's really plugged in and understands the why behind it. And by the way, for those of you who have tuned in to the Making Cents podcast, we are on with Robert Frick. He is our corporate economist here at Navy Federal. Bob, I'm not sure if you knew we were recording but I love the real time Twitter feed. 

So, what was I reading the other day where it was so interesting how everyone who was reading it-- it was completely misconstrued. I think it had to do with spending and it might have been a monthly report, maybe Consumer Spend or Retail Spend. 

ROBERT FRICK: Probably Retail Spending. 

EMILY BIGHAM: Yeah and no one ever talked about the stimulus checks and the way that money just-- Also I think it was Consumer Credit and they were trying to say that that was an indicator that the economy is bouncing back. And I'm thinking, but it's all credit. No one's paid any money back. 

ROBERT FRICK: Well, yeah, we got these trillions of dollars and a lot of people banked it. And a lot of people paid down their credit lines which is as good as cash. So they have more credit that they can use and then more money in the bank. And we're still coasting on that when it comes to retail spending at least. And once you factor that in things don't look nearly as rosy as the numbers would indicate. 

EMILY BIGHAM: Right. And on that note, given the way that the economy has shifted this year a little unexpectedly, what can you tell us about-- can you give us an overview, I guess, about what you've seen happen due to the pandemic and what you're thinking is going to happen early next year? 

ROBERT FRICK: Sure. Well, obviously the economy tanked in the second quarter when everything shut down. Some of it was the government said shut down. A lot of it, most of it, was people said, I don't want to go out with COVID raging. We bounced back in the third quarter, but as I said mainly because the government shot trillions of dollars to individuals and small businesses. And the Fed took interest rates down to zero so the third quarter was mostly a bounce back but it wouldn't have bounced back if the government hadn't weighed in so heavily. So we are still to some degree on life support. And even though spending's pretty good and consumer confidence is low but holding steady, we are still coasting on government programs. And the idea is we probably need more stimulus to get us to that promised land next year, second or third quarter, when we start getting vaccines and treatments and people can really breathe a sigh of relief. More jobs come back, more spending and we can really start walking on our own two feet instead of having the government assistance kind of prop us up. 

EMILY BIGHAM: Bob, when would you say it's too late for the next stimulus? When would you say is the? Deadline 

ROBERT FRICK: Well it looks like it won't happen until January at this point because the federal government has gone home until after the election and won't be back probably until January. So I don't think January is too late but if it goes much beyond January-- we're already seeing permanent damage done to the economy. Millions of people are going into long term unemployment and that's bad. The economy depends on people working. More people working, more paychecks, more spending-- that's just how it works. That's the bottom line. And the more people go into permanent unemployment, the longer it is for those people to get back to work. And we've proven that over and over again in the last 10 years. We really proved it in spades. It took a long, long time for a lot of people to come back after the Great Recession. 

So, I think we're OK, January maybe February, but if somehow we don't get stimulus then we're going to have to crawl out of another pit 

EMILY BIGHAM: Bob, what if we get a vaccine? What if we get a vaccine? Would we need a stimulus? 

ROBERT FRICK: I'm counting on a vaccine. I'm saying that assuming we get a vaccine and it's well distributed in the second or third quarter. But we've been building this bridge, this $3 trillion bridge to get us to-- since apparently we can't control COVID on our own, we're going to need to get vaccines and other medications. But we've built 80% of a bridge. Now, 80% of a bridge only gets you so far and that means we're going to be falling off the edge for that last 20%, which is really again second and third quarter of next year. So I'm not the only one saying this. Most people are saying this. We need more stimulus I don't think it has to be a lot. But we certainly have to help lower income Americans, especially in small businesses, just to get them to a point where they don't declare personal bankruptcy, they don't fall into long term unemployment, they don't get so far behind on their bills they can't dig themselves out. 

EMILY BIGHAM: Right. I guess that would be preventing the long term damage. And also I think just being able to give people some confidence and make them feel a little bit better. We're heading towards the winter. We live on the East Coast. You see how people's moods tend to drop when their not in the sunshine. And I think just knowing that there's something on the horizon is a positive sign. I haven't really been reading a lot about a potential stimulus in January and February and hearing that-- I'm optimistic. And I think that that's something that people should be talking about. Just because we're not going to get one right now or in November doesn't mean that we're not going to get one. Like you said, we're still on life support due to government funding. And if we can just get to January and February, things can turn around. So do you have any short term tips for people who are trying to stretch their finances as much as possible? 

ROBERT FRICK: Sure. I always do. As a former personal finance journalist spending years doing that, I always have advice to give. But I think the advice right now comes with an interesting preface and that's that people are doing great right now. There's nothing that focuses people's attention like crisis. So you see people saving a lot, not spending as much, paying down their credit lines. People behave very rationally when money is tight. On the other hand, when things are booming, like you said, with the credit bubbles, and the housing bubble, and the internet bubble people then spent like crazy. People aren't doing that now. So that's great. But people still react in bad ways during times of crisis because anxiety makes us behave emotionally. 

So my number one piece of advice is make a list. Make a list of all the things you're paying now that you really don't need and stop paying them. My wife and I went through and just cut a number of things off of our-- things that are deducted out of our checking account. We redid our cable and got a service which is saving us hundreds and hundreds of dollars a year. We cancelled two trips. Not that we were going to take those trips anyway-- one of them was to England. We typically rent a house on one of the Finger Lakes every year for our family get together-- that's gone. So when you make a list, a lot of good things happen. One, you look at things that you might not have looked at anyway. Two, you tend to prioritize things which we don't do if we're just trying to fix things in our head. And three, and most importantly, once you make a list you can start checking things off the list. That gives us a sense of accomplishment, that makes us feel better about ourselves, and It shows we're making progress. So don't rely on all the things churning in your brain right now to make financial decisions. Write it down. 

EMILY BIGHAM: Those are some great tips, especially as we approach the holidays too. I think it's really important for people to think about what's important to them. There is a lot of gift giving and there's a lot of shopping but there's also a lot of sales. If you make your list and prioritize and there are things you absolutely need, you can probably find them at a cheaper price just given the shopping season. 

I want to go back to what you said about the housing market, though, because earlier we were talking about the 2008 financial crisis. That was more of a housing market catastrophe. I think it's really difficult to try to compare what's happening now with previous recessions because you're seeing-- people are looking to buy homes now. They're moving out of cities. They're buying homes. Rates are really low. So for certain people who are in a good financial situation, it's probably a good time for them to start making those big purchases that they've been saving up for. Could you talk a little bit about how this potential recession is different from previous recessions? 

ROBERT FRICK: Yeah and that's really interesting. When it comes to home building, home buying, that is one of the few bright spots in the recovery right now. People talk about a V-shape recovery in which we went way down and we spring back up. Housing is probably the only clear spot in the recovery in which things are going so well. Part of that is you have a lot of millennials that are becoming of home buying age. Part of it is interest rates are at historically low levels. Part of it is because there's been a tremendous backlog of home buying and now we're finally being able to get out of our houses. The whole real estate community has made it easier to buy a house. My family just sold two properties and they go to great lengths and do interesting things to allow kind of contactless buying. And it went very smoothly and the two townhouses we sold went very quickly. So housing is a big bright spot, if you're selling. If you're buying, it's very tough because there is so much competition. 

One of the things that I was holding back on is committing to this idea that there's a lot more home buying now because people are moving out of urban areas and moving to homes where they can establish home offices, rooms where their kids can essentially go to school remotely. Just in the last couple weeks there's been enough data to come out that I finally buy into that idea. It's been anecdotal but now I think we have the numbers to go with it. 

EMILY BIGHAM: So you do buy into it? 

ROBERT FRICK: I do buy into it, yes. So COVID-- I heard this great quote, COVID is reconfiguring us, not just how we spend money, but how we look at our lives and our lifestyles. And this is one of the big ways that we're doing it is we figured this is going to be a long term situation. I'm not pessimistic about that. I think certainly a year from now there's going to be a lot more travel, a lot more restaurants, a lot more jobs. I think we're going to bounce back but I think we're finding that we can work from home efficiently. I think that COVID will be with us to some extent for a long time. And people say, OK, I'm not going to fight it. I'm not going to hold my breath. I'm going to change my life to basically make allowances for a long term situation. 

EMILY BIGHAM: Right It's been long enough now that I think people are beginning to understand that this could be a longer term and you can't fight it. I mean you kind of just have to figure out what works for you and your family. I want to go back to travel for a minute because you said that you expect when this is over that travel will bounce back. Due to the fact that so much airline travel was for business and now it's very unclear whether companies are going to be sending people-- Now that we can work from home efficiently, what is your outlook there for travel, as far as business impact on travel? 

ROBERT FRICK: Right. Well, a good friend of mine works for a travel trade publication and I follow what he says. Business travel is never going to come back, at least not in the foreseeable years, to what it was before. And that's disappointing for me because I go to one conference a year and it looks like that's going to be-- it was canceled this year and be canceled next year. I really enjoy that conference but there's been a lot of superfluous business travel, which I think everybody is recognizing. And it's just cheaper not to do it. And so airlines are recognizing that. Now leisure travel is something else again. And I think as COVID levels come down, come way down, we're going to see leisure travel pick way up. That might not be until 2022. Who knows. But people need to travel. People want to see other places. People want to visit their friends and relatives. That's going to come back 100%. I'm positive. 

EMILY BIGHAM: Personally, I'm still traveling for personal reasons. I live on the East Coast, as you know, but I'm from the West Coast and I've gone back a few times. I think it really just depends on comfort level because the airlines, I think, have been doing a good job. But, also on travel, you mentioned superfluous traveling for business and how that's probably not going to come back. I tend to think-- me personally, having part of my team up here at headquarters in Virginia and then part of the team down in Pensacola, it's really important to me to go down to Pensacola and see the people on my team and connect in that way. I think there is something about being with people in person. And with you at your conferences, I'm sure part of that is networking with people who are in your circle. We need the human connection. I don't want to be constantly through a computer, through the phone. I think it's really important for business. 

ROBERT FRICK: Yeah, I agree with you. I don't consider that superfluous. As a matter of fact, just in a meeting we had yesterday one of our executives said, you know how do you think things are going? And I said, well you know we're very productive right now. And in fact more productive in some of the things we do. However, I really miss that personal contact. I was in our headquarters building earlier this week to drop off some things and I really miss wandering around talking to people, talking to you in now credit cards, talking to people in savings, talking to my risk management colleagues. I get a lot of good ideas. And in some of the projects I work on, the projects which take innovation, which takes new thinking, you need to be face to face to do those. I don't think you can do those nearly as well via Zoom. So I'm agreeing with you. I think we do need that to an extent. But I think a lot of times people were traveling for really no good reason. In a previous job, I was traveled to the West Coast a lot into Southern California and sometimes I'd just go there overnight, or for two nights, just to meet with a couple of people. There was no reason I had to do that and take a red eye. Now, I love Santa Monica and I love meeting with the people I met with, but I could have just as easily done that via Zoom and saved the company I worked for then thousands of dollars. 

EMILY BIGHAM: It goes back to trusting your employees and making sure that when they do travel it's for a reason. Bobby and I used to work together very closely when I was in PR and now that I'm in credit cards we'll kind of talk about what's going on. And of course I get my personal finance tips from you. I miss that. But it's really difficult to do research for a project when you have to set up a call with everyone. I think we're probably learning what roles are good at home, what teams can function well working from home and then who needs to be in the office face to face. So I think that's another positive thing that people can do while we're in this situation. Start thinking about your business and how the working from home situation works or doesn't work, and where you can save money or where you're spending more money because of the situation and kind of restrategize. 

ROBERT FRICK: Exactly. And come up with a new strategy. I mean, as you know, I work on various behavioral finance projects and it was much easier to do those when I could sit in a room with people and explain to them these new concepts. It's harder to do that if I do it in a paper or even if I do it in a Zoom meeting because, as you know, I get excited about it. I try and motivate people. I can answer a lot of questions. I can read their body language. You can't do that. So now we have to find kind of new ways to push the envelope. I think, for Navy Federal-- I'm kind of astounded that every month people are finding new ways of doing that and we are coming up with new products and finding new ways to help our members and that sort of thing. So it can be done but I think it takes more effort. 

EMILY BIGHAM: Well I think part of that, too, is because at Navy Federal our strategy really hasn't changed. It's always serving members. And I know, for example, in credit cards some of the changes we made to our products a couple of years ago are doing really well right now because we have always been thinking about-- no matter what happens, how are we just going to best serve our members' needs? I want to get a little bit into that. So the military and veterans-- how has this impacted the military? And have you seen anything change with employment with veterans? 

ROBERT FRICK: Well the good news for veterans employment, which just in the last few months I've really started looking at under a microscope, is that veterans employment is always low. Veterans unemployment is always at a very low level. When the pandemic hit, veterans did lose jobs but not nearly at the rate of the general population. And veterans gain their jobs back more quickly. That's because veterans tend to be better trained, better educated. If you're a veteran, you've shown that you really know how to get a job done. So veterans are great employees. I think everyone knows that. So veterans are doing well. 

EMILY BIGHAM: Good with crisis, too. 

ROBERT FRICK: Exactly. Right. They know how to handle a crisis. So what's been interesting, especially for me, is people have been asking me what's a good strategy for veterans? Should they extend, if they're offered, should they extend their hedge? And given a choice between coming out of the military into this environment and coming out six months or a year from now, I think, unless a veteran has a great job or a soon to be veteran has a great job lined up, I don't see any problem with staying in the service, getting more skills, kind of riding out these rocky times. So I know a lot of people have been preparing-- a lot of our military members have been preparing for their careers, sometimes for years. They've gotten degrees in the military, they've gotten special training and lined up jobs. And if they're ready to get out, great. But if they're not ready and they expect that they're going to come out into this great environment, they're going to be sadly disappointed and it's better to wait. So that's what I've been advising some people who are still in. 

EMILY BIGHAM: So the military community is definitely faring better than the civilian population? 

ROBERT FRICK: Oh yeah. And military spending-- if you're still within the military, military spending is still strong. When you leave the military, employment for veterans is still good but, all things being equal, this is not a great time to be launching yourself into this kind of chaotic economy. 

EMILY BIGHAM: Yes. So what should you not do? We talk a lot about tips and tricks but what should people not be doing? 

ROBERT FRICK: Well, one of the things that-- when we did our best careers after service project last year, which was terrific, and one of the things that I discovered in my research, and talking to people who employ a lot of veterans and to people who counsel veterans, is veterans need to not make going back to their hometown their first choice. Maybe there's a job for them in their hometown but everyone who I spoke to said, broaden your horizons. Look at other cities, other places, other regions of the country. Now I've worked at several places throughout my career and I know it's hard to start over. But especially these days where employment opportunities aren't that great, you've got to really look at cities, regions, companies which may be in another state, maybe on the other side of the country, where you can get a great job, restart a career, start a new career. Do not hold yourself to your hometown or even to your home state. 

The other thing that we're seeing, which is true every time we have a recession, is that people with lower educational attainment-- high school degrees and less especially-- their unemployment rate is so much higher than people with college degrees or people with good training in the trades or vocational training. So use that GI Bill. Now is a good time if you want to get out of the service-- is put yourself in a program where you know there's going to be a demand, whether it's college degrees-- which a surprising number of veterans are getting college degrees now, although it's down a little bit from previous years. But if you can get into college or a trade program, use that GI Bill. That's the thing, especially in a dicey economy like this one where it may take several years for us to get back to a vigorous economy again. Get that education. Now's a great time to do it. 

EMILY BIGHAM: That's very interesting about looking at job markets and taking a closer look at that because things are shifting. And, like you said, you thought it was just anecdotes you were hearing about people moving out of cities, but there are shifts. And it does seem to be state by state depending on where this pandemic is hitting hardest and what restrictions there are. So I think that's a really great tip. When I was getting out of college and trying to think about what I wanted to do and where I wanted to move to, I heard people say, be picky don't take the first job that you get. I don't know if people can be very choosy these days. I guess it just depends on, again, you're list and what you're prioritizing. But these are all really great tips, Bob. 

ROBERT FRICK: That's a really good point, though, because when I got out of college-- back in the dark ages-- the economy was in bad shape and we were told, just take whatever job you can get. And I was a journalist. I had just gotten out of journalism school and there weren't many great opportunities. And I sucked it up. I took a job and I put in my two years and the economy had gotten better and then I could move up from there. It wasn't a great start but it was the only start I could get. So there's something to be said for just getting started. That's why I like the idea of waiting and getting more education because you'll be able to launch yourself into a better job with more money at a higher level than perhaps, probably, if you enter the job market right now. 

EMILY BIGHAM: But Bob when you and I were talking earlier-- I want to make this important distinction because when we're talking about education and training, you're not necessarily talking about the four-year typical American college. 

ROBERT FRICK: Exactly. 

EMILY BIGHAM: So can you get into the differences there? 

ROBERT FRICK: Yeah. Yes, sure. I think especially with the whole idea of four-year college in some respects coming into question right now because of COVID, but also because of the high cost, there's a lot more thought being given to getting a two-year degree, getting an associate's degree or getting training in a technical field or even a non-technical field such as IT or something like that. 

A good friend of mine was a guidance counselor for a number of years at a high school here in Vienna. And he's retired now but he is keeping me apprised of what he would be advising students to do today. And in a lot of cases it's don't go and get that four-year degree or go to a community college for a couple years and then go on and get your four-year degree. So it's not an either-or proposition. There are a lot of gradations between a four-year degree and no education. No education is a non-starter. You're never going to do well with no education. But there are a lot of intermediate steps that people should really think about. Again, a two-year degree-- great, technical training-- great. Sometimes your two-year degree will lead to a four-year degree. I know there are some great nursing programs in which you start as kind of a base nurse, like a nursing assistant, and then you work yourself up and finally get your master's degree in nursing. All along the way you get paid. So there's a lot of paths to success which are not a four-year degree. 

EMILY BIGHAM: Yeah. That's true. And I think it's probably time to break that mold and start thinking about some other things and become a more well-rounded economy so that these types of things don't completely take us down the wrong path. 

ROBERT FRICK: Yeah. When I got out, and probably when you got out, that was your choice. And now I got my three daughters through college and one of them through a master's degree, and it was a struggle. It was a financial struggle. And now I would probably think that it would have been better to start out in community college or focus on, only in our case, Virginia schools. They all went out of state which was a killer to the budget. Now I'd probably say, you know honey-- again three girls-- you know, yeah, you could go to the University of South Carolina, but University of Virginia is pretty nice too. 

EMILY BIGHAM: I think we all got caught up in-- Yeah, you always want to do the best for your kids so no regrets there. But I have three other siblings and we all went to schools in California. Three of us went to UC schools, University of California, so it's a little bit better-- not great as far as money-- but better. And the best piece of advice that I ever got was from my uncle who's a very successful business man and he just said, whatever job you're doing do the best that you can. And I think that that's really served me because the thinking back since I've been in the workforce have gone from communications and PR over to lending and then-- it's been all over the place. But I really like it and I enjoy it. And I feel like the experience that you get is just as good, if not better, than some of the education or classes that you can be taking. So really just depends on whether you need specific training, like if you're a doctor or a surgeon, That's not going to be my next move. There are things where experience is definitely more important than going to school. So, like you said, you got to stay calm, make a list, prioritize, and then start doing some research. In the meantime, just do the best that you can with what you've been given and I feel like that's all that we can really do 

ROBERT FRICK: Yeah and I think that's great advice. Do the best wherever you are. Another good friend of mine says, whenever you take a job, from the first day on that job, be thinking about what your next move-- it may be internally, it maybe externally. And I've been blessed to land at some really great places and I've been able to stay a long time. But I've also been a newspaper journalist, I've moved to magazines, I've worked for a big financial company, I worked in publishing for a while and now, through tremendous luck, I'm in Navy Federal and I'm an economist. And it's always been that great advice which is, do the best you can but always be looking to what really interests you and follow your interests, pursue your interests, and that will pay off for you. Don't think that once you choose a career, that's the end of it. 

EMILY BIGHAM: Right. Well, and getting that experience-- say you just take a job that you're not exactly super interested in, you might get exposed to something that sparks your interest and then you kind of follow that path. So I think that even though we've been talking about the economy and the pandemic, which isn't necessarily the happiest topic, I think there are a lot of really positive things and tips that you talked about here. You think that if we have a stimulus next year, early next year, that's going to be great. We're still kind of riding the high of the previous stimulus so people just need to keep their spirits high and, like you said, make a list, prioritize. And the housing market is the one area also that seems to be going well so it's not like everything has taint. 

ROBERT FRICK: Right 

EMILY BIGHAM: And I'm interested to see what happens with travel. It's going to be good. And people can take this time to think about their current businesses and make some cuts in some places and think about growth in other areas. And I think it's a really interesting time. And Bob I hope that we can chat again, maybe in a few weeks or months, or maybe I'll actually see you in person. Miss you. 

ROBERT FRICK: Wouldn't that be nice? 

EMILY BIGHAM: Wouldn't that be great? 

ROBERT FRICK: Yeah. Well, I think certainly in three or four months we'll be doing that. And I think in four months from now I think the economy will have taken a turn for the better. The degree, the extent to which it's better, is an open question. But people have a hard time imagining a year from now how things are going to be because we've been hit with one blow after another. A year from now things are going to be much better than they are today. And people need to start thinking about that and envisioning a better future because if you only focus on the negatives today you're going to be missing a lot of opportunities 

EMILY BIGHAM: Right. Look for the bright lights. So Bob, four months from now having you back on the podcast and we're going to see if your prediction is correct. I'm penciling you in now. No, but where can listeners find your ongoing insights? 

ROBERT FRICK: Well I tweet a lot these days, RobertFrickNFCU and I really like people to follow me, especially members. I talk about the economy, yeah, but I will also talk about my dog and recipes. I'm also kind of snarky at times because I think you need to poke fun at some of the things that make no sense, especially in the media and the economy. I did that today and I got a lot of good reactions from it. I think you need to really keep things in perspective and that's what I try to do. So please follow me there. I will do write occasionally for our website, but Twitter is really my main outlet. And I have a lot of members that follow me. We have great conversations. So if you follow me and you're a member, I will promise to follow you back and I will respond to every comment you make. 

EMILY BIGHAM: Bob, what if this podcast blows up and millions of people start following you? What are we going to do? 

ROBERT FRICK: I would love it. I can hire people. I could hire people to manage my Twitter feed. 

EMILY BIGHAM: Well you said you like to poke fun at people that don't make sense. And on this podcast all we do is make sense because it's Making Cents. 

ROBERT FRICK: I won't make fun of you, Emily. 

EMILY BIGHAM: Time for me to go home. Bob, it was so good to talk to you. I miss these conversations. Maybe I'll start following you on Twitter. 

ROBERT FRICK: Oh boy, what a treat that would be. But yeah, certainly a year from now we'll all be getting together and I think we'll be wiser for it. I really do. 

EMILY BIGHAM: Yes, absolutely. Well thank you for ending on a positive note. And to all of you Navy Federal members or listeners out there please feel free to send us any questions that you might have for Bob or anything that you would like to talk about on the podcast. And follow us wherever you get your podcasts Bob, have a great rest of your day. 

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ROBERT FRICK: You too, Emily. Thank you so much. 

EMILY BIGHAM: Bye. 

ANNOUNCER: Navy Federal Credit Union is federally insured by the National Credit Union Administration. This podcast is intended to provide general information and shouldn't be considered legal, tax, or financial advice. It's always a good idea to consult a tax or financial professional for specific information on how certain laws may apply to your individual financial situation. References to, and participation with, the military community does not constitute organizational endorsement. Navy Federal is an equal housing lender. Navy Federal Credit Union. Our members are the mission. 

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EMILY BIGHAM: Welcome back to MakingCents, the podcast brought to you by Navy Federal Credit Union. I'm Emily Bigham. Thank you again for tuning in, and remember that you can subscribe to this podcast wherever you get your podcasts. 

This week, we're going to be talking about mortgages, specifically VA loans. Service members and veterans often hear about VA loans, but they can be pretty difficult to grasp. And so today, we're going to try to simplify those for you so you can understand and also take advantage of their true value. 

So today, we have an expert on VA loans, Kevin Parker. Kevin is the VP of field mortgage here and Navy Federal, which means that he manages the team of loan officers. They're member-facing, they're actually on the ground talking to members and, I guess, get a lot of these hard questions. Welcome, Kevin. Thanks for being here. 

KEVIN PARKER: Thanks, good to be here. 

EMILY BIGHAM: So I have a little bit of a question to throw you off today, just to start the day. Now that we've been working from home for a little over seven months, how was your morning routine changed? 

KEVIN PARKER: Much different. So, I do not have the hour and 50 minute commute that I used to have. So that time, I found that I was spending a lot more time laying in bed. 

[LAUGHS] 

I also have two little girls, a 9 and 12-year-old. So they're in school. So I'm finding myself to be a breakfast chef, and-- 

EMILY BIGHAM: Nice. 

KEVIN PARKER: --trying to get them ready for school as well too. So it's definite changed a bit, but, you know, we've all been able to basically manage through and still add value. Whether it's being a part time father or a professional or working in my pajamas at home. 

EMILY BIGHAM: Nice. Well, next time I'll have to have you bring me breakfast. 

KEVIN PARKER: Ah, sounds good. 

EMILY BIGHAM: [LAUGHS] 

KEVIN PARKER: Sounds good. 

EMILY BIGHAM: So VA loans. I hear a lot about VA loans. In fact, my mother-- shout out to Patty Bigham-- she texted me the other day and she was asking me questions about VA loans. And I was like, first of all, mom, that's not my area of expertise. I'm going to kick you over to the experts in Kevin's department. But, you know, it led me to realize just how complicated they can be. Because my parents have had a few mortgages in their lifetime, and to still be asking questions about VA loans and their benefits just made me realize how confusing they are. So why do you think that there's this perception? 

KEVIN PARKER: Yeah, it's a great question. And I think that's a great topic because we're always out there trying to dispel the myth of VA loans and them being confusing or harder and the perception. The reason the perception is out there is because the purpose of a VA loan is to help members get into a property that's viable, a property that's going to hold value. But also, a product that's going to be beneficial to their specific needs. 

And by specific needs, I mean more times than not, a lot of our military members maybe can take advantage of not putting down as much money as what a typical non-service member. And by that, we mean, there are a lot more low down payment options when getting a VA loan. So that right there is an instant benefit, meaning more cash. That's cash that you can use towards buying furniture or fixing up the property, things of that sort. 

But the overarching point of VA loan is, that loan is there to protect service members and make sure that they're getting into a financial product that can be beneficial to them, specifically. 

EMILY BIGHAM: So when you talk about less of a down payment, you know, there are a lot of mortgages out there that don't require a down payment or a large payment. And so if you had to boil it down to the best benefit of a VA loan, what would that be? 

KEVIN PARKER: The interest rate. 

EMILY BIGHAM: The interest rate. OK. 

KEVIN PARKER: Right. 

EMILY BIGHAM: Even in a low rate environment like we're in today? 

KEVIN PARKER: Even at the low rate. So I should say, lower interest rate. 

EMILY BIGHAM: OK. 

KEVIN PARKER: Lower than typically your conventional loan, which in layman's terms means, less money, meaning your monthly mortgage payment is going to be a little bit lower than it typically would for other products. So that's a huge benefit. 

Two, right behind it, as I just mentioned, the low down payment, meaning that's a lot less cash that you have to put down. And let's kind of touch on that for a moment, just in terms of just the cash aspect of it. When we provide loans to consumers, the more equity you have in the home, the less risk it is for the institution. 

EMILY BIGHAM: The more equity. 

KEVIN PARKER: Right. And by that I mean, let's say the home was worth $100,000. And you do a loan for $80,000. So the difference of $80 to the $100, that's the equity in the home, meaning cash, liquid in the home. Worst case scenario, that extra $20,000 is there as a cushion in case the lender has to get their money back. So that's the whole thing about why is it such a big deal putting down cash versus not? And for a VA loan, the VA comes in and helps us, basically securitize our loans. Which means that, if anything goes wrong, the VA is going to be there to back up that loan. That's really the benefit of where the Veterans Administration comes into place. 

EMILY BIGHAM: And so that's why the lender is able to give a lower interest rate? 

KEVIN PARKER: Correct. 

EMILY BIGHAM: Got it. OK. 

KEVIN PARKER: Because the VA is backing half that loan for us. 

EMILY BIGHAM: So is it more difficult to get a VA loan then because you're going through the lender and then also the VA? 

KEVIN PARKER: So ironically, it's not. So you would think so. That's a great question. But that's where the benefit of the Veterans Administration comes into place-- that, not only will we secure half that loan for you, but they're also going to give you a better interest rate. So you're kind of get a double benefit of being able to not put down as much money, keep more cash, and have a lower interest rate, keep even more cash. 

EMILY BIGHAM: Sounds good to me. 

KEVIN PARKER: Yeah. 

[LAUGHTER] 

EMILY BIGHAM: So then, I guess my question goes back to, then why is there such a perception that they're so difficult to understand? Is that where the eligibility question comes in or what's that perception? 

KEVIN PARKER: Yeah, eligibility. And then also, one of the main purpose for the VA loan, once again, is to make sure that we are lending a house that's viable. And by viable, I mean, it's structurally sound, it's not a lemon, you're going to keep that property for a long term. 

And so by that specifically, the VA has very specific requirements when they do appraisals, when they do home inspections. And so that's why you're going to get maybe some of the more-- what seemingly can be restrictions around VA loan is because sometimes the VA might require some additional inspections. Or not inspections, but some additional improvements done to the home based off the home inspection. That's where the perception comes from that it may be a little bit harder. But the key-- 

EMILY BIGHAM: Just because the-- 

KEVIN PARKER: --thing is-- 

EMILY BIGHAM: I'm sorry to interrupt. 

KEVIN PARKER: No, no. No, no. Not at all. I'll say, but the key thing is working with the lender that's very familiar with the type of appraisals, type of home inspections. Because for us, like Navy Federal, we're specialists when it comes to VA. So we're very used to working with our members and working with the appraisers if anything needs to be done on a property. But more times than not, it's a common appraisal like any other conventional product. 

EMILY BIGHAM: So how many times can you take advantage of the VA loan? 

KEVIN PARKER: Great question. So the VA allows some flexibility in terms of what you call VA eligibility and we also call subsequent use, meaning you can use it multiple times. But it's really based upon your specific situation. 

For example, some will want to get a VA loan for the purpose of an investment property or for a second home. Some would want to get a VA loan-- most want to get it for the purpose of a primary property. And so it really depends upon that person's unique needs, which is why they make you go through the Veterans Administration to actually find out what your eligibility is. And we help our members with that process early, before they even apply. 

EMILY BIGHAM: So even if you're eligible for a VA loan, is there ever a right or a wrong time? 

KEVIN PARKER: No, I wouldn't say they're the wrong time, because the VA is such a good product. I mean, we really believe in it and think it's a very, very beneficial product. So I wouldn't say there's a wrong time. More times than not, more veterans are going to use it for primary purpose. So that's your overwhelming, I would say, the purpose of getting a VA loan, for primary resident. 

EMILY BIGHAM: What are some of the other options that you guys recommend if they're not going to take advantage of the VA loan? 

KEVIN PARKER: Yeah, so-- 

[CLEARS THROAT] 

Now fortunately, we're lucky. From the standpoint of, we are a portfolio lender, which means that we keep some of the loans that we issue on our books, meaning we don't sell them to Fannie Mae. And what I mean sell them, Fannie Mae buys loans to help securitize loans. Well, for Navy Federal, we keep some of our loans on books, which means that we have a bit more flexibility, which means that we can create products very specific for unique needs. 

For example, we have a program called Military Choice. It's almost very close to what a VA loan is. The only difference is you're not using your VA eligibility. So if we have a member who does not want to use their eligibility for whatever reason, well, we have a different option of our Military Choice program in which the rates-- almost just as good, it's not quite the same. But it's almost just as good as a VA loan. 

EMILY BIGHAM: So to me, that kind of makes sense. You know, you want to have options, especially because military members are moving quite often. And sometimes they don't know if they're going to relocate or if they're going to go overseas. Does going overseas or being here in the United States, does that change anything about the VA loans or eligibility? 

KEVIN PARKER: No, because it's based off what the property is. So we lend in all 50 states. So regardless of where the member is, the reasons for their mortgage could change. But as long as it's in the 50 states, it doesn't matter where they are. 

EMILY BIGHAM: And can you refinance a VA loan? 

KEVIN PARKER: Absolutely. So that's was a great question. So there's a pro product called Interest Rate Reduction Loan, and that's a special program. Because every time you do financing, it cost money. All right? There is an appraisal fee, you have to do title, you have to do title work. And all those are different fees of cost associate with the loan. Well, with the Interest Rate Reduction Loan, those costs are reduced because you're not going to have to do an appraisal, in essence, we're saving money on the expense to do your loan. And it's a much faster process. And so we actually have a dedicated channel just to handle our Interest Rate Reduction Loan for our members. 

EMILY BIGHAM: So I'm going to switch gears a little bit and kind of talk about what's going on right now. We're in a recession, but the environment's very different from that 2008 housing bubble recession. Have you seen any change in consumer, I guess, member behavior when it comes to home buying? 

KEVIN PARKER: Yeah. So ironically, not as much as you would think. So right around March when COVID really hit, we did see a touch of a decline in terms of homes listed for sale. If you think about it, people didn't necessarily want to sell their-- list their home because they didn't want people maybe walking through and doing inspections. And on the other side as well, people buy homes-- they're a bit hesitant of going out there and shopping for new homes, et cetera. 

But after March, we started to see home purchases kind of trend back up to normal levels. If you look today, even the same purchase trend is about the same that historically has been. So we haven't seen a huge shift in behavior. Our production from a Navy Federal perspective, still gonna be on target pre-COVID that what we thought. So no, I mean, honestly you haven't seen a big change. 

EMILY BIGHAM: So I assume probably with the low interest rates, you guys are getting a lot of refinancing applications. 

KEVIN PARKER: Absolutely. 

EMILY BIGHAM: Yeah. 

[LAUGHTER] 

Well, that's good. 

KEVIN PARKER: A huge number. 

EMILY BIGHAM: That's smart, right? That's what you want members and consumers to do. 

KEVIN PARKER: Absolutely. 

EMILY BIGHAM: Is take advantage, when they can, of what's happening. And so tell me about your first home. 

KEVIN PARKER: Great question. So my first home was actually right out of college. So I went to Hampton University down in Virginia in the Tidewater areas. So as you can imagine, it's a lot of military members in that particular area. And at 23 years old, a buddy of mine, we wanted to buy an investment property. 

And ironically, the person buying that property was a veteran. And they actually did a VA loan on their side. So I got to experience a VA loan as a seller, in which talking about the appraisal and talking about the inspection on the seller perspective. And so that was my very first opportunity of basically buying a home as an investor and then selling it to a VA member. 

EMILY BIGHAM: So, you know, from a seller perspective, I assume that's a lot different from being a buyer. What are maybe some, like, old tips that you can-- or I guess things to know about being a seller on the VA side that members should be aware of. 

KEVIN PARKER: Yeah. I think that's a great question. I think one of them is understanding, maybe, what some of the red flags might be for the property type or the type of property or just inspections in general, improvement just in general. More times than not, if the home is viable, once again, structurally sound you're gonna be able to sell it regardless of what type of loan that you do. 

But there is some in regards to painting and plumbing that, I think, maybe if you're selling it to a VA buyer, it might be helpful to know. But in more times than not, that's going to be on the realtor. The realtors, that's what they there for. We work very closely with our realtors. A lot of voters are very experienced and they're familiar with VA loans. 

But one thing we do recommend for our members, our buyers in general is, you want to work with professionals who are familiar with that specialty. And by that I mean, I use the analogy of, when I want a steak, I'm going to go to a steakhouse. 

[LAUGHS] 

Same thing for if I want seafood, I'm going to go to the restaurant that specializes in seafood. 

EMILY BIGHAM: [LAUGHS] 

KEVIN PARKER: Certain lenders specialize in VA loans versus others. I think we take a lot of pride, Navy Federal, working very closely with our military members and their families that we are a VA specialists. More than half the loans that we originate are VA loan. So we're very experienced and we're very comfortable in helping our buyers, helping our members. But also, working with realtors, and working with title companies, working with appraisers and working with homes inspectors. 

EMILY BIGHAM: There's a lot that goes into the mix. 

KEVIN PARKER: Yeah. It's its own ecosystem. And so that's something that we're very comfortable and confident in working through that process for our members. 

EMILY BIGHAM: And your loan officers are across the country, right? I mean, I assume everywhere there's Navy Federal branch, that you probably have loan officers. And does that get a little bit complicated, especially in this current environment, do you see the different markets kind of acting differently or do you feel like across the board things are shifting and trending in the same direction? 

KEVIN PARKER: That's a great question. Yes, we do see things typically trend differently, different parts of the country. Whether it's the inclement weather, whether it's the market, whether it's the market prices in that area. 

For example, in our San Diego market, we tend to see home values-- 

EMILY BIGHAM: Patty Bigham, are you listening? 

KEVIN PARKER: [LAUGHS] There you go. We tend to see home value is a lot higher in that market versus other parts of the country, whether it's southern Texas or parts of the Carolina's in which the bang that you can get for your buck is actually phenomenal. And so, the trends are a lot different for us, because we also have to go by state laws and all of our loan officers have National Mortgage Listing Registration, meaning they have to be certified to be able to talk mortgages to members. And that's something that we do manage and we take very seriously in making sure that our loan officers are very skilled at really helping our members. 

And the great thing about offering mortgages, every mortgage is not for every person. And for us, it's about teaching our members and educating our members. This is a personal finance product. And for us, that's about financial literacy. It's about making sure our members understand because we know at Navy Federal, this is a relationship. And we want them to come back in five years or 15 years and we want to be able to help them for whatever need that they have. And so we take a lot of pride in making sure our loan officers are very comfortable in understanding each member is very specific need. 

EMILY BIGHAM: Yeah, and so, if a member moves from market to market, do they stay with the same loan officer or is it typically, you know, you want to talk to the expert in the area? 

KEVIN PARKER: So they can. So we actually to give them a choice. We try to let our members interact with us. However they want. So if they want to do it digitally, we have what we call a Home Squad System in which they can apply online. If they want to call on the telephone, if they want to walk into a branch. We want to let them interact how they want interact. And if they want to stay with a loan officer from a different part of country, they can. 

A lot of times they might want to work with a loan officer or see a loan officer in person in that market. And we can do it as well too. 

EMILY BIGHAM: I'm sure that's shifted a lot too, just given current situation. [LAUGHS] 

KEVIN PARKER: Very true. Very true. 

EMILY BIGHAM: I don't even want to get into that because I don't even-- that's just a lot. 

KEVIN PARKER: Well, the good thing about loan officers too, our loan officers, they'll FaceTime. 

EMILY BIGHAM: Oh. 

KEVIN PARKER: They'll text members. However members want to interact. 

EMILY BIGHAM: Digital? 

KEVIN PARKER: Digital, yeah. So we try to make it easy, because we realize we have our loan officers who are part-time teachers and part-time cooks, just as we are. So we try to make sure that we give them the flexibility, and they're able to work with our members, based on what their needs are. 

EMILY BIGHAM: That's great. So I have a question back on eligibility. You know, military spouses, would they be in the mix for being eligible? Or how would that happen? Do they have to be on a mortgage with their spouse who is active duty or a veteran? Or can you get into a little bit about eligibility? 

KEVIN PARKER: Yeah, so there's two ways to answer that. One, the eligibility is based off the military member, not the spouse, so the military member does need to be on the loan. And certain states require that the spouse is actually on the application. For example, California is a state that if you apply, even in your own name, that military spouse has to be on a loan. 

And so it's really state-specific, so that's why it goes back to-- we like having loan officers in different parts of the country, who understand those state-specific requirements, and we can help our members walk through whatever their needs are in their specific state. 

EMILY BIGHAM: All right, so we're about to wrap it up here. And I think we've given-- I mean, you've given me, at least, a lot of great information. Do you have any last tips or tricks you'd like to give the audience about VA loans? 

KEVIN PARKER: Sure. One, your mom better call us. 

[LAUGHTER] 

Two, once again, go onto our website, whether it's our website, or you have other websites like the VA. You have the CFPB website. There's a lot of information out there to just help people consume and understand. 

We realize that buying a home, refinancing a home, is a really, really big, probably one of the most, important transactions, and so for us, we try to be teachers. And there are a lot of calculators on our website, a lot of great tools that members can take advantage of to make sure that they learn as much as possible about the VA loan. 

So when they do find their home, we're going to try to make it as frictionless as possible, so that they can enjoy the concept of, what school are their kids going to go to, and the new furniture. 

EMILY BIGHAM: There's so many other things to worry about, too, when you're in the military and you're moving from state to state. I mean, I grew up as a Navy brat and even moving overseas, you have to send half of everything you own six months before you get there. The anxiety I felt as an 8-year-old. I can't imagine how would parents feel. 

So I think you cleared up a lot of the perceptions, and, to me, I think action relieves anxiety, so I would say just call. Whatever lender you're working with, just call and talk to them about your options. And a VA loan sounds like a great benefit that everyone should be taking advantage of. 

So thank you, Kevin, again, for being on today's podcast. And, for the listeners, please feel free to call if you have any questions, and, of course, subscribe to the podcast wherever you get your podcasts. And thanks again for tuning into Making Cents. 

NAVY FEDERAL CREDIT UNION REPRESENTATIVE: Navy Federal Credit Union is federally insured by the National Credit Union Administration. This podcast is intended to provide general information, and shouldn't be considered legal, tax, or financial advice. It's always a good idea to consult a tax or financial professional for specific information on how certain laws may apply to your individual financial situation. 

References to, or participation with, the military community does not constitute organizational endorsement. Navy Federal is an equal housing lender. 

Navy Federal Credit Union. Our members are the mission. 

[MUSIC PLAYING] EMILY BIGHAM: Hi, and welcome back to the podcast MakingCents, brought to you by Navy Federal. Today we're going to be talking about transitioning from military to civilian life. 

Every year, about 250,000 service members transition to civilian life. And as we near the end of 2020, we're approaching this crucial period for many service members. This can include many things, such as moving to a new place, finding a civilian job, rebudgeting, new taxes, also your family and kids, taking care of them and all of the things go along with them, schools, spouse jobs. So in today's episodes, we'll be discussing what to look for in a valuable civilian career and having conversations about what veterans should consider when moving to a new city after service. We're also going to add some tips to help service members save pretransition. 

So today, I'd like to introduce Clay Stackhouse. Clay, thank you for being on the podcast today. 

CLAY STACKHOUSE: I'm so happy to be here, Emily. Hello. 

EMILY BIGHAM: Hi. So Clay is the Regional Outreach Manager here at Navy Federal. He's a retired Marine colonel, spent 25 years as a marine aviator traveling to 34 countries, and completed five combat contingency deployments. Wow, Clay. So you really are the expert in not only being a member of our military, but also your transition to civilian life-- going from a Marine aviator to now here at Navy Federal. 

CLAY STACKHOUSE: Yeah. Well, I'll tell you, we'll talk about the families as we talk about the transition. I'll tell you, mine are at home right now doing Zoom school. I have teenagers. And the lovely and talented Mrs. Stackhouse, who has been that Marine wife all through the time-- she's trying to keep everything together. How are you and yours doing? I know it's been difficult for us, transition or not. 

EMILY BIGHAM: Yeah. With transition to work from home or transition from military to civilian? 

CLAY STACKHOUSE: Exactly. I think there's a lot of transition going on. 

EMILY BIGHAM: Yeah, I know. It's like, which one do we want to talk about? Well, no, you're correct. My father was in the military for over 25 years. And when he transitioned, he went-- so he was a surgeon. I think it's a little bit easier when you're a surgeon and you have a skill like that where you can move right into either working at a hospital. Or he actually has a practice out in San Diego. 

But that felt, I think, pretty-- well, from my perspective, it felt pretty smooth. I bet if you asked him, there were tons of challenges that he went through. But what was your transition to civilian life like? Is there anything that you wish you had known? 

CLAY STACKHOUSE: Yeah. That's a great question because now I'm five years past getting out. And I think I probably thought, well, I'm a Marine. Give me anything. I can do any mission and just pick them up and put them down. And I probably did not-- I didn't give the transition the attention it deserved with regard to how hard it is, actually. 

And I don't think-- you don't have to be a colonel who's transitioning after 25 years. I think people who transition after doing one hitch in the military is very similar because they're going to be younger. And proportionately, that's probably the first thing they've had to do in their life. So probably, it was harder than I thought, Emily. 

I'm glad I had my family, as you were just saying you're familiar with, to bring me through it. And to tell you the truth, my wife and I talked about what I learned. It's probably the degree to which you can lean on those who weren't in service with you. 

Navy Federal does these lists. I've talked about the VA. We've talked about Operation Homefront. There are organizations out there who really are ready and willing to bend over backwards and try and help people transition. That's kind of what I'm doing in my job, as you know, as a regional outreach manager. I get to talk all the time to people all over, transitioning veterans and their families, about things that they're really concerned with. So that's probably it. 

It was difficult, is the answer about transitioning. I learn every single day more about, I guess, what I didn't know and more about myself because the military makes you a certain person. That's your identity while you're in. I was really happy to put on the Marine Corps uniform. 

And actually, they had me-- I was the MC or whatever of the parade, the Veterans Day parade, last year down in Downtown Pensacola. And I put on my Marine Corps blues, and I thought, my kids were proud. That's a big identity. And transitioning out-- it's very difficult to think that you're not going to have that identity anymore. 

EMILY BIGHAM: Yeah. It's probably a little bit emotional and get a little bit nostalgic, too-- 

CLAY STACKHOUSE: It is. 

EMILY BIGHAM: --especially if it was for as long as you were. So I want to talk about the fact that you were an aviator in the Marines. So when you decided to be an aviator, were you thinking about the next step of transitioning out? And were you thinking you were going to potentially fly for a commercial airline? 

CLAY STACKHOUSE: Yeah, no, I wasn't. As a matter of fact, my skills as an aviator-- yeah, I flew the president's helicopter. I flew in combat all over in three different continents. And I wanted to switch gears when I got out. I do have friends who have gone into the airlines. I like to say, I was done chasing bad guys, and now I'm helping good guys, which is our members, veterans, and their families, and helping them with that transition. And it's really been rewarding. I think I snatched lightning getting in with Navy Federal right away. 

We talk about transitioning into a different job. And we did a list. We're doing best cities this year after service. You probably know a couple of years ago or last year we did the best careers after service, where I was able to talk to people all over the country about the transition from military service into what was next. And we had a list for that. You can actually look up that online as well. 

But what people need to realize is it's not just whether you are an infantryman or an aviator when you were in the military. You learn skills when you're in the military, like leadership. You learn followership. You learn punctuality, things like that. Your unit and the relationship you had with them is something that employers find really attractive. 

So as they transition, people should think, you know, what do I really want to do? And again, I was very lucky to be able to get with Navy Federal, where I'm helping military veterans and families. But it's a time where you need to really sit down with your family and the people you love and care about and talk about what you want to do next. 

EMILY BIGHAM: How do you know when it's the right time to leave the military? 

CLAY STACKHOUSE: Well, for a personal, I thought 25 years was kind of my target at the beginning. And our children were of the right age. So I think everybody-- a good question is, when people transition from the military, what is the most important thing financially? And I say, that plan, having a plan to transition. So I had a plan which was pertinent to what my family's situation was and where we were living and all that kind of stuff, how old the children were. 

The financial plan goes that way, too. You need a financial institution that you trust. And then you need to have that plan. But they taught us all in the military a plan not executed is just a wish list. So you need to be able to execute that plan. 

I'm happy to be with Navy Federal. They are helping me execute the plan. And I help people in my job on a day-to-day basis, which is great. But I think that personal plan-- you said when you started there's 250,000 people a year transition from the military. That's a lot of different wants and needs, interpersonal relationship-type things that deal with their families and where they are financially, where they are with regard to their children and their relationships. So each one is personal. 

And in the list for best cities, we took that into account-- and in the list for best careers also. We talked to over 1,000 veterans about proximity to hospitals, recreational facilities, things that are important to them. And we heard a lot of different people, a myriad of different points of view about what's important. And I just can't stress enough that it's individual. The transition's individual. And there's people there to help you. I think that's my big takeaway. There's people there to help you. 

EMILY BIGHAM: So for you, it was mostly financial. That was the biggest priority for you. But in the list, I think you talked a little bit about how where you're living is potentially your first decision. And there's top 10 cities there. 

And I want to get into a couple of those things and what the big standouts are. But also, now that we're in an unprecedented global pandemic, and people's needs and interests and quality of life are generally shifting, are you seeing any changes in the transition from military to civilian? Do you think that people are staying in the military? 

CLAY STACKHOUSE: Yeah, Emily, that's a good-- so we revisited the best cities list. We did one in 2018. And then we did best careers last year. And at the end of the day, what we're trying to do is help veterans transition. And we're asking them. They said, I'm worried about what career I'm going to go into. And I'm worried about what city I'm going to move to. 

And we said, after the pandemic, let's revisit the best cities list. And what we found in our research was that-- and it's something that's kind of intuitive, actually. We're doing a lot of teleworking now. And there's just not that draw to the big commercial centers there used to be. 

On our list, we have Charleston, South Carolina. We have Duluth, Minnesota. And we have San Diego. Those are three cities on our list. So it's geographically dispersed. And it's something where I think what we need to do is have people really drill down and say, what's important to me? 

For in Duluth, which is the only one I haven't been to on our list-- actually, I've been to all nine of the other cities on our top 10 list. I'd love to go to Duluth. It's on the shores of Lake Superior, Right? I guess the four seasons are very pronounced, and there's a lot of outdoor activities that are a draw. So it's kind of a small town feel up there. 

Now, obviously, San Diego's got the high military presence there, wonderful weather. Charleston, South Carolina, is by Joint Base Charleston and a lot of veteran-owned businesses there and that sweet Southern charm type thing. 

So what I'm getting at is the list is very varied. And so is the 250,000 people a year who are transitioning. That's why we did the list. It's to have them focus on the fact that there's a lot of different things. And you have to ask yourself and your family, what is it that's important to you in this next step? And remember, we're really there to help you with it. 

EMILY BIGHAM: It sounds like a great resource. I'm pretty sure we should include it in the podcast notes. Listeners can take a look at the list and see the top 10 cities and some of the different things that they point to. I think it's pretty interesting that in San Diego, it's such a high percentage of veteran-owned businesses. 

And that brings me back to what we were talking about earlier about utilizing your network and how it can be a very scary, intimidating thing to leave one job and go to another. But then also think about the differences between military and civilian life. It's very intimidating. But I think the positives are, use your network. There is a lot of veteran support, especially in these cities where there are military bases. 

CLAY STACKHOUSE: That's right. And the network isn't just a veterans network. You can make that club smaller and smaller and smaller. I'm in the Marine Corps Aviation Association. That pertains to aviators who are in the Marine Corps. So if you're a sonarman in the Navy or whatever you did, I'm sure that that group of people one, has transitioned before you. So there's people on the other side a couple of years ahead of you who have already done it that can help you through it. 

So look on all the different resources that are out there to stay in touch with the people you served with. And know that the people who have already transitioned are overwhelmingly willing and excited to help you with your transition. 

EMILY BIGHAM: I was speaking with our corporate economist, Bob Frick, the other day on the podcast. And we talked a little bit about veterans and whether it was the right time to leave the military and try to find a new job or potentially go get more skills or start a business. We love veteran-owned businesses. And he mentioned that it might be a good time to reassess and think about maybe waiting a year or two until things calm down and the economy bounces back. 

CLAY STACKHOUSE: Yeah. Well, and that goes back to-- I mean, if anything, I'm your tax dollars at work. I'm Marine Corps-trained. So I have a plan to go to. And I'm going to look at a pattern. And that gets back to that. Have a plan, and have a financial institution you can trust. 

Because whether or not you're going to totally switch gears like I did out of the aviation world and into the financial world, or you're going to stay in what you were trained as, or you're going to-- that's a great one. A lot of my colleagues and friends have opened up businesses. But if that's the case, you're going to want a business loan. And you're going to want to be able to go to a financial institution you trust and say, hey, look, here's my plan. Are they giving the plan a look that's fair? 

And that trust is something I cannot overannunciate with regard to your financial institution. And I'm going to keep coming back to that. So whether or not you do it this year or next year, that good plan you stick with is going to be something that's going to yield results for you. 

EMILY BIGHAM: Specifically, what type of financial tips do you think? What to you are the most important things that they should be looking at or thinking about? Is it living in the cities? 

CLAY STACKHOUSE: I hate this. It's savings. A lot of people don't have that good savings saved up. And when I talk about a plan, now I have that plan. And when I talk to people, we have financial advisors at Navy Federal. But that first step is go ahead and create that budget. 

And in the budget, the first person you pay is yourself. You put that aside right away, and you grow a savings account. And that's just a non-negotiable thing to have that money set aside for times to get tough. And I'm telling you, I hate it. And I go into my region. I'm out of Pensacola. I go into a lot of rural Alabama, Mississippi, Louisiana, and they're looking at me like I'm crazy when I tell them they need three months' pay set aside just in cash. 

But that's something that you can really-- you can do that with a fairly simple plan on a budget that's just not-- I'm not going to say, not that hard to do, but doable. It's something that I've done. And I know there's people out there from all walks of life who can reach out and help you because I know it seems tough. It really does. But when you break it down, you didn't do anything when you were in the military alone. You don't have to do this alone. 

So even though the pandemic seems scary and-- oh my gosh. I got to have this much saved up. That seems scary. No. You eat an elephant one bite at a time, right? And we are there to help you. There's other organizations there to help you. Let us help you. And just pick them up and put them down one step at a time to get you into a place where you're much more comfortable. 

EMILY BIGHAM: And there's never no-- well, I guess there could be a wrong way to save. But to me, I think the most intimidating part about starting savings is you're not really sure how much you should start saving or how early you should start saving. But I think any amount is great. And then I like the idea of just the set it and forget it-- so taking a portion of your paycheck every month and just putting it in a savings account. Even if you have no plans to transition out of the military in the next year or so, start now. That's the easiest thing. 

CLAY STACKHOUSE: That's another great-- but what I do talk to people, Emily, and they're like, oh, I'm in debt. This is hopeless. And I don't have a plan. And I'm transitioning tomorrow, it's never too late. I promise you that. A plan is a plan. So it may be different than somebody's plan who started 10 years ago, but it's still a plan. And a plan gets you, once executed, to the place you want to be, right? 

So don't feel that way. And I know it can be overwhelming. As a matter of fact, I got married to the lovely and talented years and years ago. And since I went to the Naval Academy, like your father, we didn't have any student loan debts. Well, my lovely and talented wife did. And I was like, oh, wait a minute. Whoa. So it was kind of like a reverse dowry. I got married, and I got some debt. 

But then we made a plan and went through it. And here we are 29 years later, and everything's working out pretty well. So it can work, even things that you don't see coming. Navy Federal's been around a while, has a great reputation. It's a place you can go to. 

And you can tell them what your concerns are. You can call up and say, look, I'm scared about this. I don't know. OK, I looked at your best list and your best careers. But here's specifically what I'm scared about. We want to hear that. And we can help. The members of our mission-- when we say that, we mean one member at a time. So know that each person is different, and we're willing to help with each set of problems. 

EMILY BIGHAM: There's plenty of ways to find support, just like how you supported your wife. 

CLAY STACKHOUSE: Right. That's right. Best thing I ever did, by the way. 

EMILY BIGHAM: So what are some of the unexpected differences between service and civilian life? I know that there's probably a lot. But what are the most unexpected ones? 

CLAY STACKHOUSE: Yeah. I think especially in the Marine Corps, Emily, you kind of get into one way of doing things. And it's the Marine way. And I'm here to tell you, I think it's a good way. It's a great way. And I'm going to have US Marine written all over me probably till they carry me out of here in a pine box. But it's not the only way to do things, right? 

And the civilians-- I think I kind of thought everybody always wanted to be a Marine, and some just weren't able to do it. That's actually not true. There's a lot of people who wanted to do all sorts of different things. 

And I'm finding as I've transitioned-- it's been really fun, actually. My world has opened up. And I've met all sorts of walks of life of different people. And the way that they do it is not the Marine way. And it's actually a good way for whatever they're doing. So I think understanding-- you want the US Marine Corps to be a certain way. In the military, each discipline, each kind of warfare specialty you served in is the way they are for a reason. 

But know that when you transition, people are going to bring a lot of different things to the table. And it's important that you just button up and listen to them and fit into their way of doing things instead of kind of forcing them to fit into your old way of doing things. I will confess that was probably something that's-- I'm still trying to do it. I'm aware of it. But that's something to be aware of, I think. 

EMILY BIGHAM: Even just being a military kid, I didn't really even realize that I was a so-called "Navy brat" until I went to college. And I would listen to other people's experiences, or they would comment on mine. And they would be like, wow, that's really strange. You lived in Japan? Why did you live in Japan? What were you doing there? And I didn't think it was weird. I thought it was weird they grew up in the same house their entire life. I was like, what? 

CLAY STACKHOUSE: Right. When you transition, I think that-- like when you went to school, you were transitioning out of a military bubble. That's a great point. That's exactly what I'm talking about. And you realized there's a lot of ways to do things out there. And it's interesting and fun. 

EMILY BIGHAM: Yes. It wasn't the Bigham family boot camp anymore. But you mentioned the uniform. I do love a uniform. I think that just makes the most sense to put on a uniform every day. I would not mind that. 

CLAY STACKHOUSE: Yeah. Well, if you can't look good in Marine blues, you can't look good. 

EMILY BIGHAM: No comment on that. They're great uniforms. 

[LAUGHTER] 

Might be my favorite. OK. Let's go back to the differences between service and civilian life because I want to unveil and talk about the things that people might think are scary but how we can turn those into positives. 

CLAY STACKHOUSE: And that's right. No matter where you transitioned, if-- the commandant of the Marine Corps has to get out one day. And he's going to get out on his terms. And somebody who was a senior airman in the Air Force and did a hitch and got out is going-- they're going to transition on his or her terms as well. 

So be aware of the skills you got when you were in. Don't minimize them. Like that punctuality, your honor that they taught you from boot camp is not a joke. It's serious stuff. Your leadership, your followership-- you had to be quiet and do what your boss told you in the military. That's something that's attractive to employers, somebody who knows how to do those things. 

So I think as you transition, highlight the things that you learned while you were in the military. And figure out a way to enunciate to employers how that can benefit them. 

EMILY BIGHAM: So from your perspective, was it intimidating to write your resume, going for job interviews at a corporate company? What was that like? 

CLAY STACKHOUSE: Yeah. That's interesting because it probably should have been more intimidating. And again, I talk about my shortcomings. Being intimidated wasn't really part of the deal in the Marine Corps. And I probably should have thought more about what they wanted to see. 

I was actually honored you and I were both in the Aspiring Leaders program here at Navy Federal. And I went over to Talent Acquisition, which was awesome because I watched how we hire. And I thought, wow, oh my gosh. If I'd have known this before I transitioned about how to write the resumes and how recruiters actually look at resumes and pick people who are qualified and get them to hiring managers-- it was really interesting. 

And so I think I go back to what we started with, which was there's people out there who can help you with these things. And probably, I should have leaned a little harder on those I wasn't in service with who were ready and willing to help me write those resumes who had already done those things. 

So I just implore all of those veterans who are transitioning. I know you're used to being big dog in the field you're in now. You're probably at the top of your game. You probably have qualifications, and you're comfortable with what you're doing now. Writing resumes probably isn't it, right? So get some help. That's no big deal. You can call any number of different people who can help you do those things and help you showcase all those skills that you got that you may not even know you got in the military. 

You're thinking, yeah, I did get followership. Yeah, but that's no big deal. I was just doing what I was told. Yeah. That's good. People like guys who know how to do what they're told and show up every day on time and in the right uniform, like you say, Emily, if you could just wear a uniform. But being there on time in the right uniform with the right frame of mind is starting off pretty well. And employees find that really attractive. 

EMILY BIGHAM: Yeah. Some of those little things, if you do them right, make a good first impression. I think it's also probably a good idea to have a casual conversation with someone who's been in the workforce who hasn't been around military or Marine life. And you'll probably be surprised about the things that they find surprising or the things that really stick out to them that to you were just everyday things [INAUDIBLE]. 

CLAY STACKHOUSE: Yeah. As a lot of my colleagues I served with throughout the entire Marine Corps-- as you can imagine, I've have guys I've known since really-- my wife says, since we were kids. We were dating. So as we were going through training, I was 22, 23, and I knew these men. And now I'm 52. And some of these guys are calling me, and they're just now transitioning as colonels. And they're like, oh, I'm going to do this. 

And it's amazing, Emily. I hear them saying the exact same things that I said. And I'm like, well, the Marine Corps did a good job teaching you how to feel like you can slay the world. But it's a big change. And we need to learn how to sing the civilian world song as you transition out. And there are people out there who can help you do that. 

EMILY BIGHAM: There are a lot of perks and benefits, especially ones that help you financially, when you're in the military. What are some of the unexpected costs that you came across? 

CLAY STACKHOUSE: Right. Well, you need to remember, as you transition, see-- I was in five years when I lived in the barracks. And if I got a cavity, I just went to base dental. And for lunch, I'd stop by the commissary and get something at a discounted rate you weren't even aware of. 

So I got out. Wait a minute. Whoa, whoa, whoa. I don't have dental? No. Matter of fact, you're retired, and you don't have dental. That's something you need to get through your employer. Oh, wait. I got to go to a Walmart or something like that now? Yeah, yeah. And it's going to be significantly more expensive, actually, than if you went to the chow hall or something. And you need to consider mortgage rates now, which are very good now. They may not always be. And you're not going into housing. 

So there's this entire infrastructure that you live comfortably within while you're in the military. And then when you transition out, if you're not talking to people about that-- that's that plan I alluded to before. If you're not talking to people about that before you get out, well, we just need to start talking about that, is what I'm saying, because those are things you need to make provisions for as you transition. 

EMILY BIGHAM: So I know you said there isn't necessarily a best time to start planning. But let's say someone was thinking about transitioning a year from now or two years from now. Is it too late to start planning? Is it just the right time to start planning? Give me a ballpark. 

CLAY STACKHOUSE: I'd say a year out, you're golden. That's really even with regard to your VA benefits. And there's putting together a package there. There's organizations who can help you do that. There's a lot of things out there. If you're a year out, oh, man. We're in catbird seat. That's not who I'm talking about. 

I'm talking about transitioning around-- so I'm lucky enough to talk to the National Guard. Mississippi is in my area. And I was talking to the Mississippi National Guard up in Tupelo at what's called a "yellow ribbon," which is when they come back or before they deploy. They get together and have all the different things that are available to them shown to them. It's like a predeployment brief you would do in the Navy, Marine Corps, Army, Air Force. 

And this guy had just gotten back. And he was a sergeant first class. And he was like, yeah-- he really hadn't thought a whole lot about it at all. And I'm like, OK, when are you getting out? He's like, I'm on terminal leave next week. I said, oh, OK. Wait a second here. Hold on. 

Even those guys, though, that's-- when I talked about it's never too late, that's the person I'm talking about. So he and I sat down after the event. And I just drew something up, gave him my card. Thank goodness he was a member of Navy Federal. He was able to reach out to our financial advisors-- as you know, are free of charge-- and really get him squared away with a plan. 

And like I said, it's never too late. A year out, I would love to be able to talk to him and set up something that would have been more robust. But he didn't do that. But that's OK. If you start an attack and the enemy starts shooting back, you can't just stop. You have to do something else. That's 101 stuff. And you just reset. That's all. 

EMILY BIGHAM: Absolutely, reset. And we've talked a lot about the transition from military to civilian. But you also mentioned that there's all kinds of transitionings happen all the time. So maybe you didn't do it the perfect time, or you didn't have the best transition from military to civilian. But now that you are a civilian, you-- job changes. You move cities. You even start families. Your kids go to college. As long as you're just starting and you're actually taking action on something-- 

CLAY STACKHOUSE: Right. Well, know that it's been done before. I know it's personal. And it's scary because it's you, right? Oh, this is my family we're talking about. This is my livelihood. And it gets real quick. OK. But know that it's been done before. 250,000 times a year, people are doing it. So it's been done before. And don't do it alone. Just don't do it alone. Let us help, please. 

EMILY BIGHAM: Besides Navy Federal, what are some other resources? 

CLAY STACKHOUSE: Yeah. So obviously, the Veterans Administration plays a large part. We partnered with Operation Homefront with this list. And these are organizations-- you can get on the internet any number of different organizations who are out there and willing to help in different ways. 

Obviously, we help specifically with financial things. We're Navy Federal, right? But there are emotional transitional counseling. There's all sorts of different things that you may not even consider that's out there. But if you just stop and you get in front of your computer, get a cup of coffee with you and your wife or husband, and sit down and say-- or whomever, your loved one-- and say, what are we really worried about? What keeps us up? 

And then look into it. And you can call us, as you know. You're in credit cards. You can call 24 hours a day. And if you have financial concerns, you can call our team 24 hours a day. And we're going to do something to help you. But that's a first start. And reach out to all those different organizations because a lot of people want to help. 

EMILY BIGHAM: You mentioned emotional support. Did you find that it was emotional for you? 

CLAY STACKHOUSE: I did way more than I thought, honestly. There's a lot of guys who have done a lot more than I have. And I know a lot of them. But it's funny how emotionally tied to the whole thing you kind of are. When you go out on a mission and you're signing for your flight, you're thinking, this might be it. 

It goes back to that identity we talked about, Emily. It's who you are. So yeah, yeah. It's emotional. And I just shared that from my perspective. I would not think it's any less emotional for somebody who did a four-year tour in the Air Force because they deployed with their unit or wherever they were and did what they did as well. 

And it's like a family. And it's a family you leave your original family from to join. And then you go out in service to support and defend the Constitution of the United States against all enemies, foreign and domestic. And it's just kind of a big deal. So if it weren't emotional, it would be weird, I think. 

EMILY BIGHAM: I think it's also emotional for the families, military families. For me personally, going to the Navy football games or even seeing like Blue Angels fly over-- and I know down in Pensacola, you guys have a Blue Angels down there-- it's always a huge activity and a big event. And the whole town comes out. And there's just so much support. 

CLAY STACKHOUSE: Oh, yeah. They flew over my house the other day. And I've seen them 100 times. I still get chills. 

EMILY BIGHAM: Well, I think the best cities list for veterans is-- if you feel you're going to have an emotional time or you want to keep that bond and that network close, looking at the cities is good for that as well. And then, of course, we have the careers list, too. So we'll make sure to put those resources [INAUDIBLE]. 

CLAY STACKHOUSE: Yeah. Well, it's navyfederal.org/bestcities. Or you can do the same thing slash careers, and it pops right up. As a matter of fact, I was reading them before. And that best careers list we did last year was so much fun because one of the things about transitioning for a lot of veterans is you realize what you were doing before with service, whether you knew it or not, whether you thought about it or not. It was important for me to make a difference. 

And as I was able to travel around the country and sit down and talk with these veterans one-on-one about their transition, it was fulfilling to me. It was easy for me to get out of bed because I'm like, man, I'm going to help a lot of people today. And I think a lot of veterans feel that pull. And Navy Federal's a financial organization. But we're not the wolf of Wall Street. We are actually helping veterans and their families in military. That's why we get up in the morning. 

And that was important for me. I think a lot of my colleagues who have transitioned and gone into-- well, I'll just say different organizations where they didn't feel they were helping people as much as they should have have now moved on to other organizations. And I just feel like for the people I know, that tug of service is something that's significant. 

EMILY BIGHAM: Well, and mission-oriented. It's the mission-driven-- really important to find that. Well, thanks, Clay Stackhouse, for coming on the podcast today. This has been great. Is there anything else that you'd like, any other tips, or any last insights you'd like to give? 

CLAY STACKHOUSE: Yeah. Emily, it's just a lot of fun talking to you. Thank you for inviting me on. 

[MUSIC PLAYING] 

When I feel like we reach out to people like this, not only is it fun-- and we have a lot in common with regard to our backgrounds and everything. But no, yeah, go to navyfederal.org/bestcities and take a look of what we've come up with. And know that people are out there to help you. 

EMILY BIGHAM: Thanks so much. And also, thank you for your service. 

CLAY STACKHOUSE: Oh, same to you, you and your family. 

NARRATOR: Navy Federal Credit Union is federally insured by the National Credit Union Administration. This podcast is intended to provide general information and shouldn't be considered legal, tax, or financial advice. It's always a good idea to consult a tax or financial professional for specific information on how certain laws may apply to your individual financial situation. References to and participation with the military community does not constitute organizational endorsement. Navy Federal is an equal housing lender.