One survey found that military personnel have higher credit card debt and fewer tangible assets than their civilian counterparts.¹
While the financial situation of military personnel and their families mirrors the general population in many respects, heavy indebtedness and mismanagement of credit cards may be especially acute issues for service members.
Of course, military families face unique challenges, such as deployment to conflict zones, overseas assignments and the constancy of change, making personal finance even more critical.
Money Tips to Consider
- Take Full Advantage of What’s Available
- The Thrift Savings Plan is one way to save for retirement and a Roth TSP is now available.
- The Savings Deposit Program allows eligible personnel serving in designated combat zones to invest up to $10,000 and receive a return up to 10%.²
- Saving in a Roth IRA may be a good idea if you receive tax-free combat-zone pay. This allows you to deposit tax-fee income and take tax-free qualified withdrawals in retirement.³
- The Post-9/11 GI Bill covers the full cost of in-state tuition, up to 36 months.
- Servicemembers’ Group Life Insurance protects your family with low-cost life insurance.4
- Set Goals—Like any mission, success begins with articulating goals you want to pursue.
- Establish a Budget—A budget provides the financial discipline that may help you control spending impulses that can lead to greater debt levels.
- Pay Yourself First—Determine how much money you need to set aside to reach your savings goal, deduct this amount from your paycheck, and attempt to live within the limits of what remains.
- Establish an Emergency Fund—Uncertainty marks the life of military families, so be sure you have an emergency fund that allows you to be as prepared as possible for these changes.
- Control Your Debt—Indebtedness is one of the enemies of financial independence.
As you think through your financial goals, remember, taking action today is your first and most important step.