Is the Army Air Force Mutual Aid Association (AAFMAA), Career Assistance Program Loan (CAP) worth it? I’m going to have to say YES! Back in the day as a young Staff Sergeant I needed some extra cash during a tough financial period. I was introduced to AAFMAA by a fellow Soldier. He informed me that AAFMAA offered an extremely low interest rate loan, for Noncommissioned Officers.
AAFMAA is a non-profit, member-owned association with over 89,000 members. Our strong financial foundation is the result of careful investing of membership dollars. All member families receive our Survivor Assistance Services, including prompt benefits payments and filing of claim forms with Government and insurance providers. Payment is certain in the event of a combat death because our policies have No war clause, No aviation clause or exclusion, and No terrorist clause.
AAFMAA Career Assistance Program Loan
The Career Assistance Program Loan is not really a loan. It’s more of an incentive to purchase a life insurance policy from AAFMAA. Primarily, AAFMAA offers a one-time only $4,000 loan, at 1.5% annual percentage rate with a 48-month repayment schedule. This can come in handy for a Soldier who needs a quick emergency fund.
What is required to get a CAP Loan?
- The CAP Loan is offered to Active Duty Service Members, National Guardsmen, or Reservist with an LES or orders for Active Duty.
- Be in one of the following pay grades: E5, E6, E7, E8, E9, W02, CW2, O1, O2 or O3.
- Become a member of AAFMAA and purchase a $50,000 whole life or $250,000 term life insurance policy.
- Agree to make automatic monthly payments via allotment.
- Establish a checking account with Armed Forces Bank.
- Have a valid email address for communication purposes.
- Pass a credit check
CAP Life Insurance Policies
Each policy has a monthly premium that you’ll be required to pay in addition to the loan. The following policies are eligible for the CAP:
- Level 1 Term (under age 45). Has a level death benefit for a low level premium.
- Level Term II. Low fixed premium and fixed death benefit for a period of 5 to 30 years.
- Value Added Whole Life. A policy with level premiums that increases in cash value over the life of the policy.
Despite how easy it is to qualify for the CAP Loan, I would encourage you not to treat it as free money. Just like anything you borrow, you have to pay it back. The monthly payments are $85.80 for 48 months ($4,000 at 1.50%). Please, do yourself a favor and only take out this loan if you have a plan on how to use the money.
I wish you good luck should you decide to apply for AAFMAA’s Career Assistance Program Loan.