Armed Forces Week: 6 Financial Tips From Military Experts to Service Members

armed forces week

The men and women in our armed forces deal with challenges every day, even after returning from their respective tours of duty. And while nothing can truly compare to the challenges soldiers, sailors and airmen face in combat, integrating back into civilian life — where tracking finances is key — can be tough.

For Armed Forces Week and Armed Forces Day on Saturday, May 16, GOBankingRates sought to address these real financial concerns by reaching out to the most influential members and organizations within the military community. These experts revealed what they think is the biggest financial hardship veterans and active service members face today, and what they can do to achieve financial peace.

Read: 10 Best Military Banks of 2015

1. Get a Financial Education

Ryan Guina, Air Force veteran and member of IL Air National Guard, helps others in this precarious financial position through his site, The Military Wallet.

“The biggest financial problem I see military members and veterans facing is having relevant financial education,” Guina said. “Financial literacy is a topic that many adults struggle with — and it’s easy to see why. High schools and colleges focus on teaching coursework that leads to a degree; they don’t always focus on teaching life skills. But the problem is often compounded for military members, who have a complex pay and benefits system (the complexity of the pay and benefits system led me to create The Military Wallet as a resource to help struggling military members and veterans).”

Make Your Money Work for You

Military members can become better equipped to deal with financial issues by taking classes that teach basic money skills. According to Guina, these classes should cover the military’s pay and benefits system.

“The military does have some courses,” he said, “but they are woefully inadequate and only briefly cover the most basic topics. A more in-depth course that stresses the fundamentals, such as budgeting and basic investing, would help prevent some of the struggles with debt and predatory lenders that many of our military members often fall into. This would help military members and ultimately help the military’s readiness capabilities.”

U.S. Marine Corps veteran, and author of the book, “8 Lessons in Military Leadership for Entrepreneurs,” Robert Kiyosaki expressed that military members are primed to be entrepreneurs out of the service as long as they ready themselves with financial vocabulary.

“The advantage that service men and women have is that they have had outstanding training,” he said. “They have shown discipline and strength and courage — and, in my opinion — those characteristics translate into success in the civilian world, especially as entrepreneurs.”

Make Your Money Work for You

Kiyosaki advised military members to create realistic financial plans and to learn two new “vocabulary of money” words every week.

“Understand what they mean,” he said. “Use them in your daily conversations. Stick to your plan and put your discipline and mental toughness to work. It won’t be long before you see that small changes can deliver big results. You’ll feel smarter and more confident, more in control of your financial future — and better prepared to navigate even the most turbulent economic times.”

Related: Robert Kiyosaki Urges Americans to Stop Seeing Themselves as Victims

2. Participate in Financial Programs

JJ Montanaro, a certified financial planner at USAA, notes that financial programs can be a lifesaver for service members who are looking to be financially successful.

“Those that serve our country in uniform are confronted with the same financial challenges as the rest of America. However, the unique nature of military life can ratchet up the pressure,” he said. “You don’t get to tell Uncle Sam, ‘No, I’d rather not make that move,’ when you get orders in the military. A deployment or a move to a new location, or ‘PCS’ as they’re called in the military, could be right around the corner — like it or not. This can cause a myriad of challenges with everything from housing to spouse employment.”

Make Your Money Work for You

According to Montanaro, not enough people take advantage of the federal government’s version of a 401(k), called the Thrift Savings Plan.  It “offers an easy and convenient way for service members to save for their future. Unfortunately, only about 40 percent participate,” he said in 2014.

Montanaro also recommends leveraging the military pay system. “One cool aspect of military life is that it comes with annual and time-in-service pay raises and promotions that offer a multitude of opportunities to use a portion of that extra income to do financial good (pay down debt, save, invest, etc.).”

3. Get a ‘Financial Battle Buddy’ During Deployment

When thinking of money issues veterans face, most people think of the many financial obstacles that must be dealt with upon reintegration to society but rarely about the difficulties that come managing money during deployment overseas. Managing investments, paying bills and contributing to savings can be tough while in a combat zone.

“Financial difficulties are often made worse because service members are frequently forced to deal with their finances while they are deployed, sent overseas or are out to sea,” said Guina. “Most bases offer financial counseling services (often free of charge). But unfortunately, most people don’t use the counseling until they dig themselves into a financial hole.”

Make Your Money Work for You

Jeff Rose, Army National Guard veteran, certified financial planner and author of the best-selling book “Soldier of Finance: Take Charge of Your Money and Invest in Your Future,” agrees that managing funds while deployed is a difficult balancing act. He recommends that military members reach out to a trusted person at home to be their financial eyes and ears.

“Keeping tabs on their credit (for identity theft) or if bills are being paid is very challenging,” said Rose. “That’s why it’s important to have a ‘financial battle buddy.’ For married soldiers, this is much easier as their spouse can handle this duty. For single soldiers, it’s a little more challenging but that much more important. They should consider enlisting a family member or even a close friend that monitors their credit and makes sure that nothing comes up that looks off, like an unusual credit card charge.”

4. Don’t Buy a House Right Away

Money Q&A founder Hank Coleman has served more than 12 years as an active duty Army major. He recommends military service members think long and hard before committing themselves to a mortgage, especially since they tend to move around a lot.

“Active duty service members struggle to make homeownership a winning proposition,” Coleman said. “Many struggle to even break even when selling their home thanks to having to move every three years or less. [And] others find themselves backed into a corner of being an accidental landlord in the hopes of eventually selling their home for a decent amount.”

Instead, said Coleman, military members should take a long-term approach when it comes to buying a home.

“They must come to the realization that it may be a better choice to rent, save and then only buy a home after they leave the service,” he said. “It’s a hard choice to make. Homeownership is still a big part of the American Dream, but members of the military understand sacrifice — and home buying is typically no different. It often makes financial sense for members of the military to wait and buy a home later in life.”

5. Prepare for Inconsistent Spousal Income

Continuous relocation can make it tough to live a financially sound life. Differing costs of living and the decision to rent or buy are the biggest challenges faced when moving as a veteran or service member. But in addition to these aforementioned difficulties, constant relocation can wreak havoc on the ability of military spouses to find stable work and to pursue their own goals.

Make Your Money Work for You

“Though the military does provide moving benefits, they do not cover all the costs of setting up a new household,” said Kate Horrell, military finance writer at’s Paycheck Chronicles. “Military families need to be sure that they have adequate savings to cover these costs, or these costs will end up as debt on a credit card or loan.”

She added, “Military spouses are underemployed at a much higher rate than their civilian counterparts. The change from two incomes to one income is difficult if you’ve built a spending plan around two incomes.”

Horrell stresses the importance of living on just the active duty paycheck and using the extra income to pay off debts, build savings and cover other expenses. “Veterans recently separated from the military often face difficulties finding a new job, usually at the same time that they are moving to a new home,” she said. “Again, advance planning and savings can make the transition much less stressful.”

6. Avoid Predatory Payday Loans

PenFed Foundation President and CEO Jane Whitfield targeted predatory lending as a huge setback for military members. “We know of too many situations where service members took out payday loans with an extremely high interest rate just to cover the costs of their basic needs,” said Whitfield. “These types of loans don’t solve a military family’s situation; they just make it worse.”

As an alternative to predatory payday loans, the foundation offers its Asset Recovery Kit program, which provides “short-term loans at extremely affordable rates, along with financial education and credit counseling, to help service members build the skills they need to get out of the situation they are in and to build a strong future.”

Whitfield said, “Predatory lenders are notorious for sapping a family’s limited financial resources and even damaging their credit report. That’s why we came up with a better option, and it’s not just a temporary fix. In many cases, recipients of these payday loans got into trouble in the first place because they need education on how to effectively manage their finances.”

Keep reading: 7 Ways to Get Quick Cash Besides Risky Payday Loans

Edward Stepanyants contributed to this report.

Photo credit: ian munroe

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About the Author

Jennifer Calonia

Jennifer Calonia is a personal finance journalist covering topics about banking, consumer savings, loans and debt. Her features and helpful savings tips encourage and empower households across America to achieve financial balance.

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