E. My Pay

The My Pay system is a very valuable asset. It is a website that allows you to manage and view your pay. The website can be accessed at www.mypay.gov.

It will take between twenty and thirty days, from your commissioning, for your MyPay account to be activated. When this happens, you should receive a temporary pin and username along with instructions on how to access your account in the mail--I believe the pin and username are delivered in separate mailings.

After, logging in and changing your pin, look into the following options:

• • View your Leave and Earnings Statement. You will want to periodically view your Leave and earnings statement for mistakes and or omissions. Viewing your LES will also help you to determine how many vacation days you have accrued. I will attach a docment, that details the information provided on The LES in the near future.

  • Verify your current address and select your preferred email. From the menu page (see picture image, above), click on "Correspondence Address," and "E-mail Address."

  • Change your bank information. If you're like me, and you like to maximize your cash flow, change your bank account from your traditional brick and mortar bank, to an e-bank that offers interest on your checking or savings (www.etrade.com). If your a vermilion student, you may also want to open up an account with First Bank and Trust (www.bankeasy.com) they are currently offering 4.01 % APR on checking accounts (this is not an introductory rate, but you must jump through a few hoops every month to secure the rate, valid as of 01/09). Instructions: Select "Net Pay EFT" from the main menu and follow the instructions.

  • Update your W-4: Your in medical school, and since you likely contribute more then $4,000 to your medical school education each year, you're likely eligible for the Internal Revenue Service (IRS) Lifetime Learning Credit. This credit is worth $2,000. You can qualify by contributing by loan or cash. This means, that you if you are good with your money, you should adjust your withholding so that you are not getting a huge refund at the end of the year. Access the IRS withholding calculator to determine the number of exemptions to claim on your W4. The calculator can also be accessed by visiting IRS.gov and searching for withholding calculator. In order to prevent a withholding penalty, make sure to review your withholding status at the beginning of each new year or anytime their is a change in your tax situation (pay increases with promotions and increasing time in grade).

  • Set up your Thrift Savings Plan (TSP) account. Although there is a separate website for the TSP you must first inform MyPay that you would like to start your contribution. In case you are unfamiliar, the TSP account is similar to an employer sponsored 401 k plan. Like the 401 K plan, money set aside in this account will grow tax free until it is withdrawn at retirement (currently age 65). Unlike, most employer sponsored 401 K plans, the army does not offer a matching contribution at this time. That said, investing in this option (after you first invest in your personal Roth-IRA) is a great idea. Please, know that once you put money into this account, you must keep it in until you reach retirement or you will face significant monetary penalty. Instructions: From the main menu, select "Thrift Savings Plan (TSP)," read and agree to the information on the page that loads, verify your information and click on Start TSP contribution at the bottom of the page.

  • Set your MyPay account up for AKO/DKO single sign on. This will allow you to view your account information directly from the AKO/DKO portal. In order to do this, from the main menu screen, select the "Personal Settings Page" hypertext and then select "AKO/DKO single sign on." The rest should be self explanatory.

  • View your W-2 come tax time. Easily accessible from the MyPay menu page.

  • Personal Suggestions:

    • If I were you, now that you are earning money, I would begin to use the financial services and money management tools of MINT. I've found this website to be a tremendous asset.

    • If you have poor money management skills, call up Military One Source and set up a free meeting with a financial counselor. All ARMY service members are alloted 10 counceling sessions per year--more than enough to put your financial train back on track.

    • Something to think about when determining your tax aproach. If your loans are unsubsidized, and you will exceed the loan repayment amount of $120,000, it is a good Idea to pay off accrued interest while in school. You may not have enough total tax burdon (especially since you are going to claim the Lifetime Learner Credit), to "write off" the interest payment, but consider this: if you don't pay off the interest, the interest will be "rolled" into the principle, and you will have much larger payments when you are out of school and ready to begin repayment. If you are below, and will be below, the $120,000, let the interest ride (but remember, added interest may cause your loan ammount to exceed the 120K, especially if you don't start to repay loans untill you're done with residency).

    • Food for thought, I filed my taxes and filled out the FAFSA yesterday, and discovered that BAH is not considered income on the FAFSA. Therefore, it does not play a part in determining your estimated family contribution (the number your financial aid department will use to determine your loan eligibility). What does this mean? It means that you will have about 10K worth of income that will not be used to asses your loan eligibility. In essence, you will qualify for more loans than your counterpart medical student working in the civilian sector, with the same take-home-pay.

    • Another thing to think about: Roth IRA and 401K/TSP contributions are not counted as taxable income. Therefore, if you contribute to any of the aforementioned sources, the financial aid department may be able to increase your financial aid (and help you reach that $120,000 HPLR cap, if you are having difficulty attaining it) to a greater amount then they would had you not contributed to your future retirement. Note, the aforementioned investment opportunities are analyzed by FAFSA in determining your estimated family contribution, however, only 20% of your retirement savings (as apposed to 100% of your earnings) are calculated into your estimated family contribution. In summation, if you choose to invest in your future (by investing in your ROTH or 401K/TSP), you will in essence, increase your loan eligibility and potentially increase your future prosperity. As a warning, this approach only makes sense if you are well under the 120K loan repayment amount, and you plan to enter a specialty that is eligible for loan repayment.

As always, if you have further questions, feel free to send them my way!

*** Notice: I take no personal responsibility for harm that may come from utilizing the suggestions and information listed on this page. Please use your own due dilligance to verify all provided information.