[My blog post on the MFAA website this week]

The Post-9/11 GI Bill offers potentially the most valuable and flexible VA educational benefits to date. Eligibility extends across all service statuses – Active Duty, Guard, and Reserve.  Servicemembers who have already earned a college degree as part of their military service still qualify for use of the Post-9/11 benefits.  Even better, this educational opportunity can be transferred to the servicemember’s dependents, rewarding the sacrifices made by military families in supporting the mission.

The Post-9/11 Veterans Educational Assistance Act of 2008 created one of the biggest sweeping changing to military education benefits with the Post-9/11 GI Bill since the original GI Bill was created by President Franklin D. Roosevelt in 1944. The Post-9/11 GI Bill provides up to 100% of education, housing, and fees for college education over 36 months (academic months) and can also be used for certain licensing and certification tests as well.

Veterans who have served at least 90 days of active duty service after September 10, 2001 and received an honorable discharge will qualify for the Post-9/11 GI Bill. To qualify for the full benefit, a veteran must have served at least 3 years of active duty after September 10, 2001. Those who qualify for the Active Duty GI Bill or the Reserve GI Bill will have the option to choose which benefit best suits their need.

Also note that the Harry W. Colmery Veterans Educational Assistance Act of 2017, “Forever GI Bill,” changed many aspects of the Post-9/11 GI Bill, some of which went into effect immediately and others on a rolling basis.

We at MFAA want you to know and understand some of the important planning considerations surrounding the use of this military benefit.  Here are the major details of the benefit, followed by our Top 10 planning considerations when using the Post-9/11 GI Bill benefits.

Eligibility:

• Active duty members: served at least 90 days after September 10, 2001.
• Guard and Reserve members: served 90 days after September 10, 2001 on Title 10 orders (federal service).
• Spouse and children: servicemember can elect to transfer credit to a spouse after six years for immediate use and to children after six years of service for use after serving another 4 years (use begins at 10 years of service).
• Addition to Montgomery GI Bill (MGIB): Service members who have previously used 100% of entitlement under the MGIB can qualify for 12 months of Post-9/11 Benefits. If you have not exhausted your MGIB entitlement, you can switch from the MGIB benefits.

What is covered (if you are at least a half-time student):

• Tuition and fees: up to 100% for in-state, public institution. Private and foreign school reimbursement is capped at $25,162.14 per year. Exceptions apply at Yellow Ribbon schools.  [see below]
• Qualifying programs: 2- and 4-year colleges and universities, apprenticeships, on-the-job training programs, vocational flight training, correspondence schools, national testing programs, and licensing and certification testing. You can use this VA Institution Search Tool to verify the educational institution’s eligibility.
• Monthly BAH: rate based on E-5 with dependents for zip code of location of institution.  This is paid directly to the beneficiary, not the educational institution.  If the program is all online If the benefits are used by the service member or the spouse while still on active duty, no BAH is paid.  In other words, no double dipping on BAH.
• Book stipend: $1000 per academic year for 4 years, paid to the beneficiary on a quarterly basis.
• Yellow Ribbon Programs: If the service member has 100% eligibility for the Post-9/11 benefit, a YRP school offers extended benefits.  The tuition and fees exceeding the normal maximum payment is split between the school and the VA.  Active duty servicemembers and spouses are not eligible for this program. Due to specific agreements that the VA has with each school that participates in the Yellow Ribbon Program, check with the VA for the most current criteria. You can learn more about this important boost to the Post-9/11 benefit HERE.

Example:  your child attends an out-of-state pubic institution whose tuition and fees are $8,000 per year more than your state’s public institution.  If the out-of-state school participates in the YRP, the institution will cover $4,000 of the excess tuition and the VA will cover the remaining $4,000.

• Relocation Allowance: For servicemembers in rural areas, there is also a $500 one-time benefit if they must relocate or travel by air to the nearest school.

Determining full-time or half-time student status

Undergraduate classes training time is determined this way. If 12 credits are considered full-time, a course load of 6 credits yields a training time of 50% (6 ÷ 12 = .50), whereas a course load of 7 credits yields a training time of 58% (7 ÷ 12 = .58). In this scenario, a student would need to enroll for at least 7 credits (such as two 3-credit classes and a 1-credit lab) in order to receive the housing allowance benefits.

For graduate training, the VA will pay benefits based on what the school reports full training time to be. So, if a student is taking 3 graduate hours and the school tells the VA that is considered a full-time student, the VA will pay at the full-time rate.

Once the training time is determined, the monthly housing allowance is paid at the nearest 10% level. For instance, if a student’s training time is determined to be 58% as calculated above, that student will be paid 60% of the applicable housing allowance. If student training time is calculated to be 84%, the VA will pay 80% of the applicable housing allowance.

Earning the Full 9/11 GI Bill Eligibility

The payment rate depends on how much active duty time the servicemember has. Purple Heart recipients, regardless of length of service, are qualified for Post-9/11 benefits at the 100% level. The vast majority of servicemembers must have completed 36 months of active duty service to qualify for 100% of Post-9/11 GI Bill benefits, but there is a sliding scale shown in the chart below.

Member Serves	Percentage of Maximum Benefit Payable
At least 36 months	100%
At least 30 continuous days on active duty and must be discharged due to service-connected disability	100%
At least 30 months, but less than 36 months	90%
At least 24 months, but less than 30 months	80%
At least 18 months, but less than 24 months	70%
At least 12 months, but less than 18 months	60%
At least 06 months, but less than 12 months	50%
At least 90 days, but less than 6 months	40%

Note that time served towards earning Post-9/11 GI Bill benefits is AFTER completing military service as payback for other military education benefits like student loan repayment, ROTC scholarships, and Service Academy commitments.

To utilize the Post-9/11 GI Bill benefits for college, servicemembers must pursue an education at an accredited institution that grants college degree. It can be used for all post-graduate degrees: from an associates degree and a bachelors degree to a masters degree and doctorate degree.

Post-9/11 GI Bill Approved Training and Assistance

• Correspondence training
• Cooperative training
• Entrepreneurship training
• Flight training
• Independent and distance learning
• Institutions of higher learning undergraduate and graduate degrees
• Licensing and certification reimbursement
• Vocational/technical training, non-college degree programs
• National testing reimbursement
• On-the-job training
• Tuition Assistance top-up
• Tutorial assistance
• Vocational/technical training

Servicemembers released from active duty before January 1, 2013 have a 15-year time limitation for use of benefits.  For individuals whose last discharge date is on or after January 1, 2013, the time limitation has been removed.

There are other changes associated with the Forever GI Bill that are being phased in over time so students should review updates from the VA.

GI Bill Comparison Tool

The VA offers a helpful GI Bill Comparison Tool to help show which education program and school are best based on different criteria.

 Applying for the Post-9/11 GI Bill?

Servicemembers can submit an application through the Veterans ON-line Application (VONAPP) Website. Or, call 888-GI-BILL-1 and ask to have the form (VA Form 22-1990) mailed.

Top 10 Planning Considerations:

1. Transfer at least one credit as soon as eligible. You MUST transfer credits while on active duty before reaching 16 years of service and have 4 years of retainability.  You can always add or subtract entitlement after you get out. But, if you don’t transfer at least one month of benefit entitlement to your dependent, you are out of luck.  You won’t be able to add them later.
2. Online-only study may be common this academic year. In this case, the BAH rate is a flat $916.50 per month regardless of location.
3. The GI Bill is not just for the standard 4-year college degree. Many other programs are covered.  Be sure to use the institutional search tool.
4. You may feel like you are losing part of the benefit by not receiving BAH if you are still on active duty. However, that may be the best time to use the benefit to increase earning potential for when you retire or separate from the military.
5. If you have more than one dependent who may use the benefit, consider reimbursement rates in different states and at different institutions. One dependent may attend the less expensive local community college program vs another at the private university in high BAH zip code.  The overall value to the family may be dramatically different.
6. BAH is paid directly to the family and can be saved and invested for the benefit of another dependent. Low interest federal loans will still be available for room and board expenses to the dependent currently using the VA benefit.  This strategy could still be an equitable distribution among siblings while requiring some “skin in the game”.
7. Contact the financial aid office at the institution as early as possible. Very often there is a dedicated military benefits coordinator; ask when you call.  Some Yellow Ribbon schools only provide the extra benefit to a set number of students on a first-come, first-served basis.
8. Always fill out the FASFA and other required institutional financial aid forms, even if you think you will use the VA benefits. When more than one family member is attending college at the same time, your overall family financial need will be greater and you may receive general financial aid.  It may pay to “turn off” the VA benefits during that time. Example:  Oldest child uses two years of VA benefit.  Younger sibling starts college and for two years they both qualify for greater institutional aid because the family demonstrates more “need”; benefits are turned “off”.  Oldest graduates while younger sibling finishes last two years using VA benefits.
9. Benefit usage is counted by the day, not by the month. Breaks between terms are not counted.  If you attend a school on a trimester or quarter schedule (more term breaks), this may lead to using less of the benefit compared to traditional semesters.  In some case, the 36 months of benefits could stretch out closer to five “traditional” years of college.  The beneficiary currently using the benefit will receive the accounting statements for what is used and what remains.
10. Use of Post-9/11 GI Bill benefits does limit the tax credits you can claim for post-secondary education. Be sure to talk with your tax professional about balancing these two tax planning scenarios.

Schedule a call with me HERE if you would like to talk about this or any other personal financial planning topic.