Deployment can be an extremely stressful and emotional experience for service members and their families. Like many Americans, the veteran and military population are not immune to issues with financial budgeting, debt and unemployment.
These individuals face unique financial circumstances regarding managing finances and budgeting for pre-deployment.
There are a number of steps service members should consider before deployment – such as choosing a financial overseer and creating a budget to ensure they are prepared for any emergency expenses.
According to a survey done by American Consumer Credit Counseling, 19% of veterans are dissatisfied with their current financial situation. Of these surveyed, only 50% of military respondents reported that they have sufficient funds set aside to cover expenses for three months in case of emergency and 51% of enlisted personal and 32% of officers reported not saving at all. In order to prevent future financial stress it is important to plan ahead and be prepared before deployment.
American Consumer Credit Counseling provides steps to take to ensure financial readiness pre-deployment:
1. Choose a Financial Overseer – Before shipping out, service members should select an individual such as a spouse, parent or other responsible person whom they trust to manage their finances. This person should be made aware of the current financial situation, bills and their due dates, account numbers, pin numbers, and passwords so the financial overseer is prepared to take care of their finances while they are deployed.
2. Be Prepared Legally – It is important to be prepared for all possibilities, therefore service members should choose a power of attorney and draft a will. Giving someone power of attorney authorizes them to act on the service member’s behalf in any legal matter. If possible they should give this responsibility to the same individual chosen to be their financial overseer. This will allow them to pay the service member’s bills as necessary. Also, drafting a will ensures that their assets are properly handled.
3. Review the Service Members Civil Relief Act (SCRA) – The SCRA is a federal law that ensures protection for members of the military as they enter active duty. This covers everything from rental agreements, security deposits and eviction to credit cards, interest rates, insurance and taxes payments.
4. Understand your Entitlements – It is much easier for service members and their financial overseer to stick to a budget and develop a savings plan if they both know and understand their entitlements, which can vary. For help determining which benefits service members may be entitled to, use the MyArmyBenefits deployment income calculator.
5. Establish a Budget and Create a Savings Plan – If service members do not already have a budget plan, now is the time to create one. Whether they see an increase or decrease in income during deployment, maintaining a strict monthly budget will help them save in case of financial emergencies and pay down debt. Service members should consider creating a Household Budget Worksheet.