First Command Review | You Can Do Better

Get a $695 credit card annual fee waived in my Ultimate Military Credit Cards Course
The Platinum Card® from American Express card is annual fee waived for military. Terms apply.

Military Money Manual has partnered with CardRatings for our coverage of credit card products. Military Money Manual and CardRatings may receive a commission from card issuers. Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities. Thank you for supporting my independent, veteran owned site.

First Command is a financial services company that targets military servicemembers with aggressive marketing and dubious practices. First Command Advisors use military veterans to build trust with current servicemembers and then uses that trust to sell high fee and unnecessary “whole life insurance” products.

While I do not have personal experience with First Command's products and services, I have read several horror stories on Reddit. First Command does not seem to be a scam in the traditional sense of the word, but they do employ scammy practices. You'll be much better off investing in your TSP and Vanguard Roth IRA rather than overpaying for bad investment advice from First Command.

And you certainly do not need whole life insurance. Just buy term life insurance and invest the savings in an index fund.

What To Do Instead of First Command

Follow this personal finance flowchart for active duty military. You can do all of this yourself. If you need help, there are free services on base available to assist you. You don't need to pay a financial advisor.

Max your Roth TSP. Max your Roth IRA. Max your spouse's Roth IRA. Invest in low cost index funds. Don't buy whole life insurance.

First Command Whole Life Insurance

First Command whole life insurance is a unsuitable product for a young servicemember, especially lieutenants, and junior enlisted. The Servicemembers Group Life Insurance (SGLI) is a perfect term life insurance product while you are in the service. You get up to $400,000 of coverage for $25 per month, plus Traumatic Brain Injury (TBI) coverage and a $100,000 “death gratuity” in case of your death in the line of duty.

If you have no dependents, you do not need any more insurance than SGLI. When you deploy to a combat zone, SGLI is reimbursed. SGLI offers free life insurance when in a combat zone.

If you need more life insurance due to a spouse, children, or other dependents, then look at an affordable term life insurance policy from Navy Mutual, USAA, or AAFMAA.

Advisors Abuse Trust

first command
Just…no…

First Command uses their military affiliation and veteran network to build their client database. They use their retired military rank and connections on bases to sell financial services and products that are unsuitable for active duty servicemembers and families.

First Command advisors may not be fiduciaries in the legal sense of the word. A fiduciary has a legal and ethical requirement to put your best interest before their own. Always ask if your First Command advisor is a Certified Financial Planner (CFP), fiduciary, or a registered investment advisor (RIA).

Advisors will typically sell extremely inappropriate financial products to naive servicemembers, such as whole life insurance. The advisors receive a commission based on the products they sell. Here's 2 quotes from an early 2000s investigation in First Command's practices:

In 2004, state and federal regulators fined First Command Financial Planning $12 million for making misleading statements and omitting important information when selling mutual funds with upfront sales charges of up to 50%. First Command agreed to the sanctions without admitting or denying the allegations.

Taking Aim At Military Scams Kiplinger's

The systematic plans allowed investors to accumulate mutual-fund shares indirectly by making fixed monthly contributions — typically ranging from $100 to $500 — over a period of at least 15 years. The plans impose a unique sales charge or load that is equal to 50% of the plan’s first 12 monthly payments with no sales load thereafter. Should the military customer make all of the required payments (180) over the 15-year period, the effective sales charge is approximately 3.3%. On the other hand, should the customer fail to make all of the required payments, the effective sales charge may be substantially higher. Historically, approximately 57% of First Command’s customers failed to achieve the required 180 payments and, consequently, many of them paid a substantially higher sales charge than is customary for load equity mutual fund investments.

Securities and Exchange Commission

Alternatives to First Command


Leaving First Command

There are many anecdotes of bad investment experiences with First Command online. Here's one entitled How to Get Out of the First Command Trap.

The author writes: “I'm leaving First Command as well. This post is incredibly helpful, thank you!”

When I was a young Lt, I was seduced by the dark side (re: First Command) because I wanted to get a head start on my finances. As it turns out, First Command is incredibly predatory (anecdotally, and in my opinion). If you want out, here's how to do it:

  1. Cancel your whole life insurance. Seemed like a good idea at the time, I know. Call 1-800-658-9857 for Liberty National if that's who it's through. I had luck with the paper form that I found using Google, then faxed it in (go to your AFRC, they probably have one).
  2. If you have an IRA you want to roll somewhere else, contact that agency and request an in-kind transfer. Vanguard did not require any physical paperwork to accomplish this. If they do require anything, request a 60-day rollover. This means FC will liquidate your IRA into your bank account and you won't have to pay any taxes on it as long as you deposit that amount into an IRA within 60 days. Call Vanguard or whatever new firm you're going with and they can help you.
  3. Get your money out of those high-fee mutual funds. This part is a little bit more difficult, as most financial institutions require a Medallion Signature to process any transfers. Instead, deal with FC and tell them to give you your money. All you have to do is call your advisor (hopefully you get their secretary) and say you want xyz accounts liquidated into the First Command bank account you probably have set up. If you want to send an email, here's what I sent:

“Good morning xxxxx,
First off, thank you for your advice and work with our accounts over the past couple years. (Spouse) and I are very grateful for your help.
That said, we do want to go in a different direction with our finances. I've started the paperwork to transition our IRA and single registered mutual fund accounts. We have the information for our life insurance accounts, so if there's anything we need to do regarding those, let me know.
I'd also like to transfer the remaining balance of the bank accounts (xxxx and xxxx) to my First Command bank account (xxxx). The current allotment through MyPay will probably run through the end of the month, so I'd like to keep the accounts open long enough for the allotment to go through, then transfer it.
Let me know if there's anything else you need from me in order to move forward.


Thanks,
“Your Name”

Once they liquidate your funds, call corporate at 1-888-763-7600, and they'll transfer your money to you. After that, you can invest it wherever you want.

This was all my personal experience, but if you're on the fence about bailing on First Command, please please do some research and/or message me directly and I can help with anything you need. FC is predatory, and there's nothing wrong with admitting to yourself that you were duped. If you have any other tips, please comment and add them!

Reddit Review and Experiences

Here is a small sample of the real experiences other military servicemembers have had with First Command on Reddit. I could not find one positive review.

Experience with First Command “Stay away from First Command. Stay further away from whole life insurance, it is a waste of money. Research term life insurance and decide if you need it once you’re married.”

Does anyone have experience with First Command? “He's in sales and works on commission. If you want to learn about finances there are plenty of free resources.If you want to make this guy a lot of money than just do everything he says.”

Dumping First Command “Also following, literally in the exact situation. I've discussed it with my advisor and he straight up told me that they only make money by selling people insurance, saying “If we didn't sell insurance to a new lieutenant, we've failed” which to me sounds awfully predatory. I'm in the same boat of wanting to cut ties entirely, but it seems like a huge pain. Let me know how this goes for you!”

Met with a First Command Advisor in Killeen, Texas. “Stay away. You don't need whole life and you don't need mutual funds until you are maxing out your tax-advantaged accounts (TSP, IRAs). As an O-1, this is roughly 50% of your pay, so I doubt you're doing that.”

Cutting Ties with First Command “You're getting hosed.”

Shaking My Head…First Command “Yes, another first command victim…”

I Want to Quit First Command, What Should I Do? “Move your money out of first command asap.”

Another First Command Sucker Alright well as of 24hrs ago I thought I was smart with my finances but after stumbling upon this subreddit and spending some time in here, I've come to the sad and disappointing realization that I've probably lost a lot of potential money over the past few years.

Feeling like a real idiot for using First Command “Long story short, I thought I was doing the responsible thing by using their services. After reading this sub more I realized I made a mistake. What should I do now?”

Leaving First Command – Need Some Help “Trying to leave First Command (finally) after they got me at TBS. Transferring all my money out of their savings and into my main account, trying to liquidate my investments with them, and canceling whole life (yup they got me to buy it).”

What's the problem with First Command?

I hope that helps you stay away from First Command. Please let me know your experiences with the company, both positive and negative, in the comments.

Is First Command a pyramid scheme?

First Command is not in the traditional definition of the word. You don't need to recruit additional salespeople under you to buy your product as you would in a pyramid scheme or Ponzi scheme. However, First Command does employ questionable sales tactics.

Are First Command advisors fiduciaries?

First Command claims on their website to hold all of their advisors to a fiduciary standard in their client relationships. Whether they in fact act as fiduciaries is questionable based on many servicemembers real world experience.

How much does First Command cost?

For example, one recommended First Command mutual fund is the MFS Growth Fund with ticker MFEGX. MFEGX has a 5.75% front load fee, which means you lose 5.75% of your investments immediately! TSP and most Vanguard index funds have no front load fees. This fund also has a 0.87% expense ratio which is 17x more expensive than a TSP fund or Vanguard Total Stock Market Index Fund (VTI or VTSAX).

8 thoughts on “First Command Review | You Can Do Better”

  1. I initially heard about first Command from the welcome brief here on Fort Carson. I filled out the form provided by them. They contacted me about a week later. I made an appointment with them and met them at a Qdoba were they bought a meal for me and they talked about what they do etc. They asked me all kinds of questions such as were I and my wife are originally from they got real personable with me with their questions.

    I had to cancel three of my future appointments with them, because of work. I had my second appointment with them today. This time with my wife. My next appointment is on 30NOV21. Some of their advice from today was to not pay off my wife’s car early that is at 2.9% interest rather I’m guessing to invest into First Command which will be mentioned in the next appointment if that happens. I have been taught to payoff your smallest loans than pay off the bigger ones to save money from paying interest, and to get out of debt faster. I felt a little shock when First Command told me to hold off on paying off my debt.

    My wife had a TSP when she was in the Army. She is out now, and still has an amount in it. First Command is going to want here to transfer it over I am sure. They told me if she liquidates it that we will be charged 10%, I already knew this. They also said that they would take out taxes from the amount in her TSP. How can we transfer the money over from her TSP and not have the tax penalty?

    Just a developing story in the works. any comments suggestions tips are welcomed. :)

    Reply
  2. I got suckered by First Command. Big Time. I’m so very happy that I finally left them. They sold me whole life, when I was single and had no kids and didn’t need it. And their “premier” SIP investments lagged the market by almost 50% over the 7 years that I invested with them. The advisor convinced me to take out a $25K loan in order to invest more money with him. So incredibly stupid. Fortunately, I was able to roll the brokerage account and IRA into Vanguard with no issues. I still have not been able to get rid of the whole life policy.

    If I could post a pic of their 7 years of returns from my statement, I would. But, the cumulative return on their SIP high-growth fund was actually 53.11% from 2013 to 2019. With a 2.4% cumulative fee. The S&P cumulative return during that time was 95.02%.

    Reply
    • Jennifer – sorry to hear about your experience. This is exactly why I wrote this article, to help other servicemembers avoid making similar financial mistakes. Thanks for sharing your comment.

      That’s good you were able to escape to Vanguard with minimal damage, but I’m sorry to hear about whole life insurance when you had no dependents and the investments with poor performance. If you want to email me that screenshot I can post it, mmm at militarymoneymanual dot com.

      Reply
  3. Too bad you claim to know “better” but also have no experience with their services or products. You seem to get your information from reddit as opposed to doing any legitimate research. Looks like you also have a bias based on all of the advertisements you post. I have been a client since I was 22 and, thanks to First Command, I am recently fully retired with a paid off home and income for the remainder of my life. I can’t say that about the other military members I’ve known that follow your “sage” advice.

    Frank C. Borik
    CDR USN (Submarines), (Ret)

    Reply
    • I have first hand experience with First Command. This is a sales company posing as a financial planing firm. Advisors will sign with military members for free and try and convince them to buy over priced Whole life insurance to make the largest commission as possible. They are trained to manipulate you in to buying This type of insurance. The employees make huge commissions on the policy’s. I would suggest speaking with true professionals for investing and buy insurance if needs on term basis. First Command is not a friend to soldiers.

      Reply
  4. Does First Command charge military members? I didn’t think they paid fees except for a “yearly management fee ($15?)” and the advisors were paid by the companies.

    Reply
    • Look at the front load fees on the mutual funds they recommend plus the advisory fees they take out of assets under management.

      Reply
  5. Thank you for spreading the word! This company operates right on the edge of cheating clients outright, freely giving harmful advice if it increases the commissions they earn on client investments. My ex-advisor’s “advice” cost me many thousands in tax consequences, not to mention great emotional distress.

    Reply

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.