Montgomery GI Bill (MGIB)


History of the Montgomery GI Bill

The GI Bill dates back to June 22nd, 1944 when Franklin Delano Roosevelt signed the GI Bill into law. At that time, the GI Bill covered up to $500 of school tuition a year. It became known as the Montgomery GI Bill (Chapter 30) in 1984 when it was revamped due to Mississippi Congressman Gillespie Montgomery's efforts, increasing the benefit for soldiers to provide $300 per month of financial assistance for 36 months. The MGIB has not changed dramatically since its passage, but the payout rate has steadily increased over the years. Regardless, the MGIB was not keeping up with the skyrocketing cost in higher education. This led to the passage of the Post 9/11 GI Bill (Chapter 33) in 2008, which in most cases is a substantial improvement on the Montgomery GI Bill.

NOTE: Those entering active duty military service on or after August 9, 2009 will no longer have the option to receive the Montgomery GI Bill; they will automatically be enrolled in the Post 9/11 GI Bill.

Montgomery GI Bill Eligibility

  • Military veteran with an honorable discharge
  • Hold a high school diploma, GED, or 12 hours of college credit
  • Meet all the requirements for one of the below categories:
    • Category 1
      • Joined active duty service for the first time after June 30, 1985 (but before August 9, 2009 when MGIB was phased out for new recruits due to Post 9/11 GI Bill)
      • Paid $1,200 into the MGIB in $100 monthly installments
      • Served a continuous 3 years (2 years if that's what you committed to on your enlistment contract) OR 2 years followed by 4 years of service in Selected Reserve (must have joined Selected Reserve within a year of leaving active duty).
    • Category 2
      • Joined active duty service before January 1, 1977.
      • Served minimum of 1 day between October 19, 1984 and June 30, 1985, and stayed active duty through June 30, 1988 (like for category 1, joining the Selected Reserve for 4 years can reduce required active duty service by a year).
      • On December 31, 1989 had entitlement remaining from Vietnam-era GI Bill.
    • Category 3
      • Served on active duty on September 30, 1990 and consequently separated involuntarily after February 2, 1991.
        • or involuntarily separated after November 29, 1993
        • or voluntarily separated due to the Volunteer Separation Incentive (VSI) or Special Separation Benefit (SSB).
      • Must have contributed $1,200 towards the MGIB during military service.
    • Category 4
      • Served on active duty October 9, 1996 and had money remaining in a VEAP account at that time and elected the MGIB before October 10, 1997.
        • or served on full-time National Guard under title 32 between July 1, 1985 and November 28, 1989 and elected the MGIB from October 9, 1996 to July 8, 1997.
      • Contributed $1,200 towards the MGIB during military service.

Montgomery GI Bill Rates

The payout rate for the MGIB increases each fiscal year (October 1st). The current monthly payout rate for those eligible for full MGIB Active Duty benefits is $1,564.00 for full time students.

FISCAL YEAR 2011 MGIB RATES FOR 3+ YEARS OF ACTIVE DUTY SERVICE

Montgomery GI Bill Rates for College Students
   
Training Time Monthly Payout Rate
Full Time Student $1,564.00
3/4 Time $1,173.00
Half Time $782.00
Less than Half but more than 1/4 $782.00 (tuition and fees only)
1/4 Time or Less $391.00 (tuition and fees only)

 

MGIB Rates-On the Job Training(OJT)/Apprenticeship
   
Training Period Monthly Payout Rate
Initial 6 Months of Training $1,173.00
Second 6 Months of Training $860.00
Remaining $547.40

For Correspondence and Flight courses, each $1,564 paid will deduct a month from your remaining MGIB entitlement.

Cooperative: $1,564.00

 

FY 2011 MGIB RATES FOR LESS THAN 3 YEARS OF ACTIVE DUTY SERVICE

Montgomery GI Bill Rates for College Students
   
Training Time Monthly Payout Rate
Full Time Student $1,270.00
3/4 Time $952.50
Half Time $635.00
Less than Half but more than 1/4 $635.00 (tuition and fees only)
1/4 Time or Less $317.50 (tuition and fees only)

 

MGIB Rates-On the Job Training(OJT)/Apprenticeship
   
Training Period Monthly Payout Rate
Initial 6 Months of Training $952.50
Second 6 Months of Training $698.50
Remaining $444.50

For Correspondence and Flight courses, each $1,270 paid will deduct a month from your remaining MGIB entitlement.

Cooperative: $1,270.00

 

Time Limit

Montgomery GI Bill benefits must be used within 10 years of separation from active duty military service. This can be extended due to disability or from being detained by a foreign government or entity. Also, the 10 year time limit can restart for those who re-enter military service for at least 90 days. Extensions for serving less than an additional 90 days applies for those who become disabled, suffer a hardship, or separate due to a pre-existing medical condition.

MGIB Buy-Up Program

The MGIB Buy-Up program allowed servicemembers to increase their Montgomery GI Bill entitlement by as much as $5,400. Under the MGIB Buy-up Program, each additional dollar contributed by the servicemember was matched by $9 from the government for a maximum buy-up of $5,400 which translates to an extra $150 a month for a full time student. Unfortunately, those choosing to use the Post 9/11 GI Bill can not receive their money back from participation in the Buy-Up program unless they exhaust their entire Post 9/11 GI Bill entitlement. If that happens, it appears that the VA will refund your full $1,200 contributed towards the Montgomery GI Bill and the money contributed towards the buy-up program IF you have proof that you contributed to the MGIB buy-up program

Army College Fund and the MGIB

Monthly payments under the Montgomery GI Bill could be higher if the soldier enlisted with the Army College Fund (ACF) enlistment incentive.

MGIB Refund

Unfortunately, those electing to receive benefits under the Post 9/11 GI Bill do not receive a $1,200 refund for contributing to the Montgomery GI Bill. Those who contributed under the MGIB Buy-Up Program are in the same boat as they receive no refund. The only way to receive a refund from contributing towards the Montgomery GI Bill is to use your entire 3 years of Post 9/11 GI Bill entitlement. Why so hard to receive a refund? This is because your pay was reduced $1,200—it wasn't a deduction so it's technically nonrefundable as stated on the initial MGIB sign-up form. However, the law could have been modified as part of the passage of the Post 9/11 GI Bill but was apparently overlooked or ignored due to the sheer volume of refunds it would have required.

Article Last Modified: December 29, 2012

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