It has been reported that one of the largest burdens on military families is finances, and that the worst financial times for military families are the first two months after deployment and the first two months after returning. To avoid adding financial stress to your life, read below to learn about some of the most common financial hurdles for military families and tips for managing them.
Common Military Finance Challenges for Families
Roughly 60 percent of U.S. families are dual income, but those numbers don't hold true for military families. According to the Blue Star survey, only 43 percent of military spouses are employed - and many who don't want to be. Strive to build a lifestyle based on one income. Alternatively, develop a spending plan where your fixed core expenses can be covered with military pay and allowances. If or when your family has two incomes, focus on building a cash cushion for when you may not be in the same situation.
Uncertainty in Deployment
Military families face big questions that make planning hard. When will you move again? Is a deployment in the cards? Should you rent or buy? Will you be able to continue your career or get a job at the next duty station? Will you be caught up in force shaping? For today's military family, there are no guarantees, which makes it especially important to plan ahead and save up for unexpected expenses.
Potential Changes to Benefits
Military retirement and health care are targets for change. As government spending is constantly changing, don’t rely on your current benefits when planning on the future. To prepare for possible military retirement changes, start or save more in your savings account. Whatever the outcome, you'll be better prepared. And don't forget to make sure your voice is heard for government spending by contacting your representatives and supporting organizations.
Unique Housing Needs
Deciding where to live and how much you can afford is never easy. But with frequent and sometimes abrupt moves, military families might have it even harder. If you expect to be in the area for at least five years, buying can be a good idea. But if you are likely to move again soon, avoid the financial stresses of homeownership and opt for an option like military housing that allows you to move quickly and use your basic allowance for housing to cut costs.
Communication at Home
The number one issue deployed service members worry about is how they’ll communicate during the deployment about subjects such as finances, child care, and family decisions. Take time to sit down and discuss financial basics like what and when bills are due, where receipts are kept, who’s going to perform which household roles, and which budgets to maintain. Communicating openly about finances before, during, and after deployment relieves tension and stress.
Military Financial Assistance & Tips
Consider a Second Job
More work means more money. If you are a military spouse with extra time, look in to a second job to help supplement extra cash flow. There are plenty of online jobs that can be done in your spare time, or you can look for local, part-time job openings in your area.
Create a Family Budget
Having a budget might be one of the most important financial tips. While you don’t have to stick to a budget strictly, keeping track of your spending and planning ahead for future expenses will make sure you aren’t spending more than you make. This is an important step to do as a family prior to deployment and should be reviewed regularly.
Look for Everyday Savings
As a member of the military or a military dependent, there are many deals and discounts available to help keep spending low. Look for coupons and don’t be afraid to ask if military discounts are offered. From clothing and groceries to hotels and flights, companies are happy to help make spending easier on military families.
Debt is one of the most detrimental things to finances, and one of the easiest to fall in to. Creating a budget and planning ahead should help you avoid going deeper into debt, but it is also important to work toward paying off any past debt. Minimized debt means a higher credit score and more buying power for big life decisions down the road.
Prepare for Tax Season
With everything already on your plate, preparing for tax season is easy to forget until it’s crunch time. Save yourself time and sanity by keeping a file of everything needed to file your taxes when the time comes so you aren’t rushing at the last minute. This keeps you organized and ensures you aren’t missing anything when it comes time to file.
Take Advantage of Benefits
Just like with everyday savings, military families are able to take advantage of even more savings through military benefits. Look in to how much you can save on healthcare, insurance, housing, education, and more to help relieve some of the financial strain of military life. It doesn’t hurt to apply for scholarships as well for an added boost.
Tackling your finances doesn’t have to be an added stressor in your already hectic military life. Use these tips to overcome common military finance challenges and feel more confident in your saving and spending. All it takes is planning and communication to get yourself on the right track!