Managing credit and finances can be difficult for anyone, but service men and women and their families face some unique challenges, as sometimes-frequent moves and deployment can present complications.
May is Military Appreciation Month, and we’ve asked a military finance expert five questions to get her advice on some of the common issues service members and their families may face.
Lacey Langford, the Military Money Expert®, is the founder of LaceyLangford.com, a personal finance blog and a boutique financial coaching practice specializing in the unique world of the U.S. military. Langford hosts The Military Money Show, a podcast all about money and the military. She is a U.S. Air Force veteran, a military spouse and a financial coach, speaker and writer who aims to change people’s lives from being fearful of money to having control and confidence with finances. She is an Accredited Financial Counselor® with more than 10 years of experience in financial planning and counseling.
Q: What are some unique financial challenges military families face compared to civilian families?
A: Military families are managing money in a constant state of transition such as PSCing (permanent change of station), deployments, and separation from the military. Many service members lose their security clearance because of too much debt or credit problems. And many service members are the highest-paid family member or the sole breadwinner for their extended family. Because of this, it can lead to financial hardship when military members are helping pay financial expenses for many family members.
Q: What are some of the common financial- and credit-related questions you receive from service members and their families?
A: How to build credit; how to rebuild credit; and how to understand credit reports.
Q: What is your most significant piece of financial/credit advice for military members?
A: Keep money simple. There’s no need to try complicated things with money. Spend less than you make, pay your bills on time, save for the things you want and for retirement, and you’ll have a comfortable financial life.
Q: What are some common credit pitfalls for service members and their families?
A: Number 1, damaging their credit by not paying their debt payments on time. Frequent moves can lead to missing bills. It’s vital for service members to keep track of what they owe.
Number 2, taking on too much debt. Not only does it overextend people, but it also becomes complicated to manage, and that can lead to mistakes like not paying bills on time.
Q: What are some ways to financially prepare for deployment?
A: Understand what your financial picture will look like during deployment before you deploy, and then make a plan for the money. Deployed armed forces typically make more money during deployment – if they’re in a hazardous area, they often receive their pay tax-free. A great way to utilize that extra money is to save and pay down debt.
Set up your savings to be automatic during deployment. Service members can set up an allotment through MyPay to move money from their pay to a savings account each month. Or they can set up an automatic transfer from checking to savings with their bank. Automating savings will help you build up your cash surplus during a deployment.
Set your bills up on automatic bill pay to ensure you pay on time during your time away.
Plan to adjust spending money once you return from a deployment. Service members and their families often get into financial trouble because they continue to spend money the way they did during the deployment, when their income was higher. Not reducing your spending can lead to money troubles.
It’s possible to successfully manage money on the move, but you have to make it a priority. Keeping things simple – and, in the case of savings, automatic – can help reduce your financial stress.
The information contained in this blog post is designed to generally educate and inform visitors to the Equifax Finance Blog. The blog posts do not give, and should not be assumed to provide, personalized tax, investment, real estate, legal, retirement, credit, personal financial, or other professional advice. Before making any financial decision, you should always consult with the appropriate professionals who can explain your options, rights, and legal responsibilities, and advise you on any tax, legal, credit, or business implications that may result from those decisions. The views and opinions expressed by the authors of blog posts are their own views and may not be the views or opinions of Equifax, Inc. and/or its affiliates.