What It Is

Reserve Officer Training Corps (ROTC) programs offer scholarships to college students in exchange for a commitment to serve as a military officer after graduation. All contracted cadets/midshipmen receive a monthly stipend.

Why It Matters

ROTC is a primary path to a commission and can pay for your entire college education, allowing you to graduate debt-free. The stipend provides a small but steady income stream during your college years.

Who Qualifies & How It Works

• High school students and current college students who meet the academic, physical, and character requirements for their chosen branch's ROTC program.
• Scholarships: Can cover full tuition and fees, or provide a flat amount towards tuition/housing. They often include a book allowance as well.
• Monthly Stipend: All contracted cadets and midshipmen receive a non-taxable monthly stipend during the academic year. The amount increases with your academic year (e.g., ~$420/month for a junior).
• Service Obligation: In return for the scholarship and training, you agree to serve a certain number of years on active duty or in the Guard/Reserve after you commission.
• Simultaneous Membership Program (SMP): Some cadets can simultaneously enlist in the Guard or Reserve, participating in drills for E-5 pay while still in college.

Actionable Steps

What It Is

Officer Candidate School (OCS) or Officer Training School (OTS) is an intensive program that trains college graduates to become military officers. While attending, you are paid as an active duty member.

Why It Matters

During OCS/OTS, you begin earning a military salary and accruing time in service. Understanding your pay is the first step in building your financial plan as a new officer.

Who Qualifies & How It Works

• College graduates who have been selected for an officer commissioning program.
• Pay Grade: You are typically paid at the E-5 pay grade while attending OCS/OTS. If you were prior-enlisted and your rank was higher than E-5, you will be paid at your prior rank.
• Allowances: Because you are living in government quarters and eating at dining facilities, you generally do not receive BAH or BAS during this initial training.
• Commissioning: Upon successful graduation, you are commissioned as a Second Lieutenant (O-1) or Ensign and your pay immediately increases to the O-1 rate.
• Time in Service: Your time in OCS/OTS counts as active duty service for pay and retirement purposes.

Actionable Steps

What It Is

Arriving at your first duty station as a newly commissioned officer comes with a new set of financial responsibilities and opportunities.

Why It Matters

The financial habits you establish in your first year as an officer will set the tone for your entire career. Getting these steps right is critical to building a strong financial future.

Who Qualifies & How It Works

• All newly commissioned officers arriving at their first permanent duty station.
• BAH and BAS: You will now begin receiving your full Basic Allowance for Housing and Basic Allowance for Subsistence, which are non-taxable and significantly increase your take-home pay.
• TSP Contributions: As an officer, you are automatically enrolled in the Blended Retirement System (BRS). You MUST contribute at least 5% of your basic pay to your TSP to receive the full 5% government match.
• Officer Uniform Allowance: You will receive a one-time, lump-sum payment to help offset the cost of your required uniforms. This is typically paid out after you complete your initial officer training.
• Career Starter Loan: Banks like USAA and Navy Federal often offer special, low-interest loans (e.g., up to $25,000) to newly commissioned officers to help with initial expenses.

Actionable Steps