Interview Series: COL Carlos Perez, Jr., USA, Ret.

Although Carlos is not technically a blogger, I wanted to include him in this interview series because of his work with the AAFMAA and the great message they provide.

This is the fifty-first in a series of interviews with fellow personal finance bloggers. Today’s guest is COL Carlos Perez, Jr., USA, Ret from American Armed Forces Mutual Aid Association (AAFMAA).

Who is Carlos?
Carlos: I work for American Armed Forces Mutual Aid Association (AAFMAA) assisting the Chief Operating Officer in managing company operations.  AAFMAA is the longest-standing not-for-profit association that empowers military families with affordable financial solutions.  I came to AAFMAA after twenty-six years of active duty Army service as an Engineer Officer in a variety of command and staff assignments, including operational and combat deployments to Bosnia, Iraq, and Afghanistan.  I’ve also had the opportunity to teach economics and national security at West Point and National Defense University.

What are the main services provided by AAFMAA?
Carlos: AAFMAA provides a broad suite of services to active military, honorably discharged veterans, and their families.  These include life insurance, financial planning, investment management, trust services and survivor assistance. We provide financial solutions for over 100,000 members of the military, veterans, and their families.  As a non-profit that has worked exclusively with the military community for 137 years, we have a unique perspective regarding military careers and financial needs. Our products are designed to assist military families in achieving financial independence through all stages of life.

What is your definition of being “financially fit”?
Carlos: There are several components of financial fitness. I like to emphasize basic principles:  Pay off and avoid consumer debt; fund an emergency account with 4 ~ 6 months’ worth of expenses; save and invest for your future; and protect your assets through insurance and trusts. And, if you’re unsure how to start, seek advice from a reputable organization. AAFMAA offers the latter through AAFMAA Wealth Management & Trust, LLC. It is also non-profit, with fiduciary responsibility to its clients. It provides fee-only services (no commissions) and is obligated by law to provide advice that is in their client’s best interests.  The only caveat is that you must be active military or a veteran to use its service.


What are your favorite finance related blogs?
Carlos: AAFMAA maintains its own blog, the INTEL Center.  There we provide a wide variety of information on topics ranging from financial outlooks to important documents everyone should safe keep. In addition, we launched a related site, SpouseLink, focused on connecting and helping military spouses around the world. When not on the INTEL Center, I like checking out the Consumerist. And, although it’s not a blog per se, I also enjoy the Money Girl podcast because it offers snippets of advice that you can take in while on a jog or doing odd jobs.

When did you first become financially literate?
Carlos: I’ve always been interested in Finance and Economics. However, it wasn’t until I was a newly commissioned Army officer and newlywed that I realized I had to take my finances seriously. I educated myself through personal finance magazines and talking with others. A friend at the time prodded me to open a mutual fund and coached me through the factors to consider, something I knew nothing about. That forced me to learn more about the world of personal finance.  Eventually, I earned an MBA at Stanford and taught economics to cadets at West Point. It was then that I seriously tackled my personal finances, developed a plan, and followed it through. My biggest lesson was that it’s never too late to learn about personal finance and set the course that’s best for you.

What are you teaching (or will you teach) your kids about money?
Carlos: The same basic principles that we advise adults apply to our children. The challenge is communicating those principles in a way they’ll understand.  While they were younger, we focused on teaching our children to “save for a rainy day.” We also discussed setting goals and then planning how to reach those goals.  At times when they wanted something somewhat expensive – a new electronic gadget, phone, or even a game, we might assist them but they always had to put up a part of the cost. This taught them that things cost money and that there is always a tradeoff. As they got older, we taught them the basics of personal finance – topics such as banking, checking, investing and borrowing. And, we discouraged the use of credit cards and accumulating debt.

What do you recommend to families struggling with debt?
Carlos: Debt can be overwhelming.  My advice is first to avoid it by having a budget and, to the extent that you can, live within that budget.  If you have found yourself in debt, then it is important to tackle it a little bit at a time. Identify an amount in your budget that you can dedicate to debt reduction and then start paying off items. Start with high interest debt first, since they cost you the most. And, don’t accumulate new debt if possible, especially through credit cards. For service members and veterans, there are relief organizations that can provide financial counseling and debt relief assistance at little to no cost.  For those on active duty, AAFMAA offers $4,000 Career Assistance Program loan at 1.5% that has helped those in the military eliminate higher interest debt.

Do you have any advice for those when it comes to preparing for retirement?
Carlos: Retirement is a significant milestone.  With most of their earning years behind them, it becomes important for imminent retirees to understand what their new sources of income will be. Typical ones include social security, a pension, and retirement accounts. However, many will need to supplement that with income generated from their wealth. They will want to rebalance portfolios towards safer investments and understand how much they can withdraw and yet retain enough funds to last their remaining lifetime.  They should also reassess their insurance needs. If they have others dependent on them for income, they may still need life insurance. Even if that’s not the case some permanent insurance might be appropriate to assist with funeral costs and settle their estate. Some policies, such as AAFMAA’s, even have a Long Term Care Settlement Option so that the insured can draw on the death benefit to help pay for long-term care expenses.

Like many things in life, financial readiness requires planning. Don’t let circumstances dictate your finances. No matter what your earnings, always pay yourself first in the form of savings and investment and protect your assets.  It is the accumulation of wealth over time, and not how much you make at any given time, that will most affect your financial success.

9 thoughts on “Interview Series: COL Carlos Perez, Jr., USA, Ret.”

  1. Carlos first thank you for your service to our country, and secondly thank you for being part of the interview series. Couldn’t agreed more it is all about having a plan for your money!

    1. Thank you for the opportunity, Brian. And, it is my pleasure to continue serving our men and women in uniform and veterans in a different capacity through AAFMAA.

  2. Very insightful definition of what it means to be financially fit. I think most people would not have included the idea of protecting their financial assets through insurance and trusts, because we assume that the wealth they have generated will stay safe in banks. Of course, if your investments are in the money market, you need to stay alert, but if they are neatly tucked away in a savings account somewhere, you’re safe. Insurance, in that case, would apply to all your non-monetary physical assets, like your house and car. I’m not sure why a trust fund would be needed by ordinary middle class folks…

    1. Thank you for your feedback. Even ordinary folks may benefit from trusts because they can help protect and provide for your loved ones. A good example is a Special Needs Trust. Through these trusts, you can provide assets for a loved one with special needs that still allows them to retain eligibility for certain government assistance programs. Other trusts have advantages over wills upon one’s death because of how the assets are treated.

  3. Carlos is really good at making financial advice. I agree with him that we should take control of our finances, not the circumstances. And, I feel like he should put up his own financial blog because I believe he can turn spenders into savers.

  4. This is great insight Carlos. I agree that it’s very difficult to teach kids about financial fitness, especially today. I think blogs are filling a void in that sense. It’s hard to make it fun, that’s for sure.

    Thanks for sharing!

Comments are closed.