Montgomery GI Bill – Explained

The Montgomery GI Bill gives up to 36 months of education tuition assistance to veterans that encompasses a wide range of eligible programs.  Almost any legitimate training or education program will be eligible for compensation through this program through VA. 

Some of the acceptable education and training programs are as follows:  college, vocational courses, technical courses, correspondence courses, apprenticeships, job training, flight training, high-tech training, licensing and certification testing, entrepreneurship training and most entrance examinations.  There are certain criteria that determine the amount of monthly compensation you receive through the Montgomery GI Bill. 

The criteria are the length of time in service, the type of training you are participating in and the category to which you are assigned.  Supplemental bonuses earned from special military service, or kickers, can also have an effect on the amount of compensation you will be receiving. 

MONTGOMERY GI BILL ELIGIBLE EDUCATION PROGRAMS

INSTITUTES OF HIGHER LEARNING

Encompassing college courses at either a four-year college or university or two-year community college for either an undergraduate or advanced degree

Payment- Issued monthly, paid in arrears, or in the month following that of which the classes were attended.  Based on the number of classes attended.  Full-time defined as 12 hours or more; three-quarter time is 9 to 11 hours; half-time is 6-8 hours.  For less than 6 hours you are reimbursed at a rate not to exceed the tuition and fees charged for the courses.  For graduate programs, you are considered full-time if the institution considers you full-time regardless of hours, and are paid accordingly.

NON-COLLEGE DEGREE TRAINING

Training programs such as EMT certification, barber/beautician school.

Payment –Issued monthly, paid in arrears, or in the month following that of which the classes were attended. Based on the number of clock hours you attend the training program each month.

APPRENTICESHIPS AND ON-THE-JOB TRAINING

Training programs that require you to learn while in the field, at times as an apprentice. 

Payment – Issued monthly, paid in arrears, or in the month following that in which the work was performed.  You can receive a salary from your employer as well as VA benefits.  You receive 85% of the full-time GI Bill rate for the first six months; 65% of the full-time GI Bill rate for the second six months; 45% of the full-time GI Bill rate for the remainder of the program.

FLIGHT TRAINING

Eligibility for this type of training requires that you already have a private pilot’s license and valid medical certification before the start of this training. 

Payment – Issued after the training is completed and the school submits information to the VA.  You will be reimbursed for 60% of the approved charges.

DISTANCE LEARNING, INDEPENDENT TRAINING AND INTERNET TRAINING

These courses are offered online, usually through colleges and universities.  Course materials are provided by the institution and they are responsible for all grading reports. 

Payment – Issued monthly, paid in arrears, or in the month following that of which the classes were attended.  Based on the number of classes attended.  Full-time defined as 12 hours or more; three-quarter time is 9 to 11 hours; half-time is 6-8 hours.  For less than 6 hours you are reimbursed at a rate not to exceed the tuition and fees charged for the courses.  For graduate programs, you are considered full-time if the institution considers you full-time regardless of hours, and are paid accordingly.

CORRESPONDENCE COURSES

General consists of lessons received in the mail for which you have a predetermined amount of time to complete upon which the completed lessons are returned for a grade.

Payment – The VA will reimburse you 55% of the approved costs for this type of course.  Please note: the VA’s approved costs may be less than the actual cost for the course.  You will be paid quarterly after the lessons are completed. 

NATIONAL TESTING PROGRAM

VA allows for reimbursement of testing fees for national tests required for admission to undergraduate programs such as the SAT or ACT and graduate programs such as the GRE, LSAT or GMAT.  Reimbursement is also offered for fees paid for national testing that offers course credit at institutions of higher learning such as College Level Exam Program or CLEP tests. 

Payment – The VA will reimburse you for the costs of these tests after you submit proof of payment

LICENSING AND CERTIFICATION

Limited to tests specifically approved for the GI Bill but will include final tests for career fields issuing a certification of licensing in order for employment.  Examples of these certifications are medical technician, jet engine mechanic, HVAC technician and the like.  The only cost eligible for reimbursement is the cost of the actual test itself.  Other fees required to receive the license will not be covered. 

Payment – the VA will reimburse up to $2000 for the tests after proof of payment has been submitted.  The test fee will still be covered if you fail the test. 

ENTREPRENEURSHIP TRAINING

The VA will pay for courses offered through the Veterans Corporation and the Small Business Development Center designed to help veterans start their own businesses or improve businesses already owned. 

Payment – The VA will reimburse you for entrepreneurship training for courses offered by the Small Business Development Center or Veterans Corporation only. 

WORK STUDY PROGRAM

This program offers students attending school at least three-quarters time a way to earn extra income while getting their education.  Students are allowed to receive education benefits while working at a school’s veterans office, a VA medical facility, a VA Regional Office or at an approved state employment office.

Payment – You will be paid either the state or Federal minimum wage, whichever is greater.

Co-Op Training

This program makes it possible for the student to attend classes either in the morning or evening and work on-the-job training in a related field at the opposing time of day.  This can also be arranged so the student attends courses one semester and works in the field the next. 

Payment – The advantage of the co-op program is that you receive your GI benefits at the full-time rate during the entire period. 

2020-2021 MGIB Rates (Active Duty (MGIB-AD/Chapter 30)

Rates for three years or more enlistment:

Institutional Training
Training Time2019-2020 Monthly rate2020-2021 Monthly rateYear over Year Increase
Full time$2,050.00$2,122.003.51%
¾ time1,537.50$1,591.503.51%
½ time$1,025.00$1,061.003.51%
less than ½ time more than ¼ time$1,025.00**$1,061.00**3.51%
¼ time or less$512.50**$530.50**3.51%
Apprenticeship and On-the-Job Training
Training Period2019-2020 Monthly rate2020-2021 Monthly rateYear over Year Increase
First 6 months of training$1,537.50$1,591.503.51%
Second 6 months of training$1,127.50$1,167.103.51%
Remainder of training$717.50$742.703.51%

Correspondence and Flight – Entitlement charged at the rate of one month for each $2,122.00 paid.

Cooperative – $2,122.00

** Tuition and Fees ONLY. Payment cannot exceed the listed amount.

Rates for less than three years of enlistment:

Institutional Training
Training Time2019-2020 Monthly rate2020-2021 Monthly rateYear over Year Increase
Full time$1,664.00$1,722.003.51%
¾ time$1,248.00$1,291.503.51%
½ time$832.00$861.003.51%
less than ½ time more than ¼ time$832.00 **$861.00 **3.51%
¼ time or less$416.00 **$430.50 **3.51%
Apprenticeship and On-the-Job Training
Training Period2019-2020 Monthly rate2020-2021 Monthly rateYear over Year Increase
First 6 months of training$1,248.00$1,291.503.51%
Second 6 months of training$915.20$947.103.51%
Remainder of training$582.40$602.703.51%

Correspondence and Flight – Entitlement charged at the rate of one month for each $1,722.00 paid.
Cooperative – $1,722.00

** Tuition and Fees ONLY. Payment cannot exceed the listed amount.

Basic Institutional Rates for persons with remaining entitlement under Chapter 34 of Title 38, U.S.C. Chapter 30

Category II rates effective October 1, 2020.

Institutional Training
Training periodMonthly Rate
No DependentsOne DependentTwo DependentsEach additional dependent
Full time$2,310.00$2,346.00$2,377.00$16.00
¾ time$1,733.00$1,759.50$1,783.00$12.00
½ time$1,155.00$1,173.00$1,188.50$8.50
less than ½ time more than ¼ time$1,155.00 **
¼ time or less$577.50 **
Apprenticeship and On-the-Job Training
Training periodMonthly Rate
No DependentsOne DependentTwo DependentsEach additional dependent
First six months of training$1,694.25$1,706.63$1,717.50$5.25
Second six months of training$1,223.48$1,232.83$1,240.53$3.85
Third six months of training$766.50$772.63$777.35$2.45
Remainder of program$754.60$760.38$765.63$2.45
Cooperative Training
Training periodMonthly Rate
No DependentsOne DependentTwo DependentsEach additional dependent
Oct. 1, 2020 – Sept. 30, 2021$2,310.00$2,346.00$2,377.00$16.00

Correspondence – 55% of the approved charges or

Flight – 60% of the approved charges

** Tuition and Fees ONLY. Payment cannot exceed the listed amount.

The Montgomery GI Bill was established in 1984 and provides financial assistance for education and training.  To be eligible you must contribute $100 a month for the first 12 months of active-duty, have HighSchool or equivalent degree, and served at least 2 years on active duty.

ACCELERATED PAYMENT

Veterans entering school or training for certain high-tech fields with the intent of being employed in the field upon completion may be eligible for an accelerated payment program.  This program provides the student with a lump sum payment of 60% of the tuition and fees for high-cost, high-tech programs.  However, this is based on what remains available in the veterans Montgomery GI Bill allowance and will be paid based on that entitlement remaining.  Also, to qualify for this program the tuition and fees must be at least double that of what you would receive otherwise from the Montgomery GI Bill benefits.  The following programs are eligible for the accelerated payment program:

  • All fields of engineering
  • Life sciences or physical sciences (excluding social sciences)
  • Engineering and science technology
  • Mathematics
  • Computer specialties
  • Engineering, science and computer management

You must certify that you intend to seek employment in one of the following industries:

  • Biotechnology
  • Life sciences technologies
  • Opto-electronics
  • Computer and telecommunications
  • Electronics
  • Computer-integrated manufacturing
  • Material design
  • Aerospace
  • Weapons
  • Nuclear technology

The school you are attending must inform the VA of your request for accelerated payment when enrollment information is sent and you must include a certification that you intend to be employed in one of the above-listed fields.  The amount you receive, even though it is received in a lump sum and not monthly, will be deducted in its entirety from your remaining entitlement.  Accelerated payment may be received for non-technical courses if they are pre-requisites for approved courses toward your degree.

THERE ARE TWO IMPORTANT CONDITIONS TO REMEMBER REGARDING ACCELERATED PAYMENT.

  1. If you receive a non-punitive grade – one not counting toward graduation requirements, for example, receiving a W due to withdrawal from a class, you may be responsible for repaying all or a part of the accelerated payment.  At a minimum, you will have to defend and provide reasoning for that grade and may be liable for repayment.
  2. You must certify that you intend to find employment in a high-tech industry, but if you fail to obtain a job, you do not have to repay the money.  However, you may be required to show efforts made in attempts to gain employment in such a job.

For a list of approved high-tech programs go to www.gibill.va.gov

WHO IS ELIGIBLE FOR THE MONTGOMERY GI BILL

Those veterans with an honorable discharge as well as either a high school diploma or GED.  Some benefits require 12 hours of college credit to qualify.  Eligibility is split into four categories as follows:

CATEGORY 1

You entered active duty for the first time after June 30, 1985

You had your military pay reduced by $100 a month for the first 12 months

Service requirements:

You continuously served for three years OR

You continuously served for two years if that is what you first enlisted for OR

You continuously served for two years if you entered the Selected Reserve within a year of leaving active duty and then served four years (this was called the “2 by 4” program).

CATEGORY 2

You entered active duty before January 1, 1977

You served at least one day between October 19, 1984, and June 30, 1985, AND stayed on active duty through June 30, 1988, OR June 30, 1987, if you entered the Selective Reserve within one year of leaving active duty and served four years.

On December 31, 1989, you had entitlement left from the Vietnam-Era G.I. Bill.

CATEGORY 3

You are not eligible under Category 1 or 2

Before separation, you had your military pay reduced by $1,200 as your contribution to Montgomery GI Bill

Service requirements:

You were on active duty on September 30, 1990, AND separated involuntarily after February 2, 1991, OR

Involuntarily separated on or after November 30, 1993, OR

Voluntarily separated under either the Voluntary Separation Incentive or Special Separation Benefit program.

CATEGORY 4

You were on active duty on October 9, 1996, AND you had money remaining in a VEAP of Veterans Education Assistance Program on that date AND you elected Montgomery GI Bill by October 9, 1997, OR

You entered full-time National Guard duty under Title 32, USC, between July 1, 1985, and November 28, 1989, AND you elected Montgomery GI Bill during the period October 9, 1996, through July 8, 1997

You had military pay reduced by $100 a month for 12 months or made a $1,200 lump-sum contribution as your contribution to Montgomery GI Bill

CONTRIBUTION TO THE MONTGOMERY GI BILL AND YOUR RETURN ON INVESTMENT

Upon joining the service you were given the option of whether or not to participate in the enrollment of the Montgomery GI Bill.  If you chose to enroll you then had the option of making a one-time lump sum contribution of $1,200 or $100 monthly to the Montgomery GI Bill. 

Return on this investment can be education assistance benefits up to $59,328 over 36 months if you served a minimum of a three-year enlistment or up to $48,204 for those who served less than a three-year enlistment depending on the veteran’s level of benefit eligibility. These benefits can be used up to ten years after separation.  Proper proof of eligibility and enrollment in a qualified program is required to receive benefits.  Benefits are almost always paid out monthly and not in a lump sum.

The Montgomery GI Bill benefits must be used within the ten years following separation for any qualified education, training or certification program or it will be forfeited.  There will be no refund of the initial contribution except under the following two conditions:

If the service member dies on active duty or within one year of separation for a service-connected death, then his beneficiaries will receive a payment equal to the amount deducted for the Montgomery GI Bill

If service ends because of a defective or erroneous enlistment, the initial period of active duty doesn’t count and contributions made during that period are refunded. 

EFFECTS OF TIME IN SERVICE ON MONTGOMERY GI BILL ELIGIBILITY

Time-in-service is one of the main factors in determining eligibility for the Montgomery GI Bill. Time spent in active duty for training or a delayed entry program or time in the Selected Reserves does not count towards the minimum time in service requirement for the Montgomery GI Bill. The following conditions must be met to be eligible for education benefits.

You must complete your initial enlistment.  Those who enlisted for two years must complete the full 24 months.  If initially enlisting for longer you must complete at least 36 months.

If your separation from service was for the “convenience of the government” then a 20/30 rule is applicable.  Meaning those enlisted for 2 years must complete a minimum of 20 months those enlisted for longer must complete a minimum of 30 months.

EXCEPTION TO THESE RULES:

If separated because of a service-connected disability, hardship, pre-existing medical condition and/or a condition, not a disability, that interferes with duty, you’re entitled to one month of benefits for every month of active-duty served up to 36 months.

If initially enlisting for more than two years and have served more than 24 months but lesson 30 you may still be eligible for benefits if within one year of separation you enlist in the Selected Reserves.

Under the Veterans Benefits and Health Care Improvement Act of 2000, if you have not met the time-in-service requirement for the Montgomery GI Bill eligibility during your initial obligated period of active-duty you can become eligible during a later period of active-duty and reestablish eligibility by completing 36 months of service with a fully honorable discharge. The following are two circumstances in which you may combine two different periods of services.

You are a service academy cadet with prior service and you failed to complete a course of education and then re-entered active duty.

You are separated during the first 12 months of active-duty because of a hardship, service-connected disability, a pre-existing medical condition, a condition that interferes with duty or disability that restricted activity that was necessary for your position and then you later re-entered active duty.

If you are unsure of your qualifications and eligibility for the Montgomery GI Bill check with the education center of your branch of service to help you determine where you stand.

KICKERS

Kickers can add to the amount of money received from the Montgomery GI Bill for enlisting in certain critical jobs.  Each branch of service offers these extra kickers in association with the Montgomery GI Bill.  Kickers are commonly referred to as the Army College Fund, the Navy College Fund and the Marine College Fund.  These kickers can add up to $24,000 to your GI Bill entitlement.

In order to be eligible for a kicker, you must first meet all requirements and be eligible for the basic Montgomery GI Bill and have received a fully honorable discharge. You should be made aware of any kickers you will receive upon enlistment and they should be written in the enlistment contract because verbal agreements will not be honored.

If you were told you would be receiving a kicker and do not receive one when the time comes you need to contact the VA.  You must provide the VA with a copy of your own record of the kicker that was promised.  Make sure not to send the original document.  A VA Form 3286–66 along with your application for benefits, which is VA form 22–1990, should be sent into the VA.  Kickers will be denied if there is no documentation showing evidence of their existence.

OVERPAYMENTS FOR POST-9/11 GI BILL AND MONTGOMERY GI BILL

The institution providing your education or training is responsible for submitting the VA certification paperwork to the VA regional processing office which allows you to receive your payment of educational benefits. It is important to keep your certifying official update on the status of your academics and go to them with any changes that may arise. The following are situations in which you should inform your certifying official:

  • Withdrawal from a course
  • Reduction in training time
  • Change in program objective
  • Termination by the school for academic suspension or dismissal

The certifying official will then notify VA and payments will be adjusted accordingly.  If, however, payments are received erroneously VA will be expecting repayment of those funds in full.

Overpayments, and at times underpayments, tend to happen occasionally even though they may not be on the fault of the student.  Close records should be kept and discrepancies in payment amounts should be verified with VA.  Any overpayments received will be expected to be paid back regardless of the cause of the overpayment.

There is, however, one exception when an overpayment is not required to be repaid.  This occurs occasionally if there are mitigating circumstances where the veteran may be able to justify payments for courses that would normally be denied such as a course that is withdrawn from.  Mitigating circumstances are defined as unavoidable, unanticipated events or situations and encompass things such as illness, employment status change and childcare difficulty that will prevent you from completing a course with a credible grade. 

Documentation must be submitted as evidence to support your claim, such as a doctor’s report or a letter from an employer.  VA will automatically grant the first instance of withdrawing from classes up to a total of six semester hours when mitigating circumstances are the cause for the withdrawal.  Withdrawal from a class because of dislike of the instructor or the fact that you will be failing the course does not count as a mitigating circumstance and repayment would be required.

THE VA GRADING SYSTEM

VA refers to grades received as either punitive or non-punitive.

Punitive grades are those defined as ones affecting the credit hours earned or the grade point average. The VA will only compensate for punitive grades.

Non-punitive grades are ones defined as those that do not affect credit hours or count towards your grade point average.  This type of grade can be received for auditing a course or receiving a grade of “I” for an incomplete course.

Your VA educational benefits are not dependent on the grade you receive or your grade point average.  All that must be proven is that you are making progress in achieving your educational goal to continue receiving benefits.

PREPARING FOR COLLEGE

For veterans wanting to enter college but who feel they are a little out of practice academically have the option of enrolling in the Veterans Upward Bound program. This is a free program sponsored by the Department of Education which is offered in locations around the country to help veterans refresh their academic skills.

To be eligible for this program the veteran has to be either low income or first-generation college, meaning neither parent received a four-year college degree, and the veteran must have served at least 180 days of active Federal service and have a discharge status other than dishonorable. Through this program, tutorial and study skills assistance is also available, as well as assistance with applications to schools and applying for financial aid.  You can get more information and contact numbers for the Veterans Upward Bound program at the following website.  www.veteransupwardbound.org/navubppinst.html

Additional educational benefits at the state level may be available to eligible veterans.  The following is a list of contact information for each state’s Department of Veterans Affairs that can be contacted to determine if your state has additional education benefits.