Financial Planning For Your Next Deployment
Deploying? 3 Tips to Get Your Financial House In Order
An overseas deployment rotation is a reality that most service member experience in their careers. However, over the last two decades, there has been an increased requirement of the United States military in areas around the world. In the past, most of this burden would fall on the shoulders of Active Duty units, however National Guard and Reserve units have also taken a large portion of those rotations, deploying on a more common basis.
Deployments mean change and possible stress for families. Everything changes when a Service Member deploys, regardless if it is their 1st or 5th deployment, being away from the normalcy of daily life changes an individual and one thing that is almost certain to change is finances.
Basic Pay and Allowances Are Only A Part of the Picture
Basic pay and allowances are only a part of the military compensation picture. Many military members qualify for special pays and incentives that are part of the service’s recruitment and retention efforts. Some compensate members for assignment to hazardous or difficult duty conditions.
Both Active Duty and National Guard/Reserve units have full time pay staff available to assist service member and families when the deployment cycle is on the horizon, however it does not completely prepare a service member or their family for the financial change that will occur. The stories of Service Member spending their entire deployment checks on items such as rims or sports cars with a 20% interest rate is a completely valid truth. To help prevent that, below is a checklist that could be a useful guide for Service Member deploying regardless of experience level.
1. Verify Pay Before You Leave
This is probably the most crucial of all the steps. The service member must verify that they are getting paid properly prior to deployment rotation. This is a problem most found in National Guard and Reserve units; however, it does affect Active Duty as well.
All dependents and marital status need to be updated in the Defense Enrollment Eligibility Reporting System (DEERS) (https://tricare.mil/deers) to ensure proper health care coverage. The dependent documents also need to be processed by the unit’s Personnel Services in order to ensure that the Service Member is getting proper financial benefits for their families.
This is a lot easier to accomplish prior to leaving the Continental United States (CONUS), rather than dealing with a situation when you are across the world. Additional information can be found with the Service Member’s respective Unit Personnel or Pay Branch.
The Service Member and their families need to educate themselves on what pay they may be entitled to. Defense Finance and Accounting Service (DFAS) provides links for Service Member to research the pay that could be available by location.
This is mission dependent. Just because a unit gets deployed to an area, does not mean that the Service Member will receive what is listed on the DFAS website. This could change due to the actual physical location of the Service Member rather than the unit.
An example of this would be if a unit deployed to the Kosovo region, but the Service Member is in Bosnia. There is a pay difference between the two areas, even if the same unit is represented in both. Additional information can be found with the Service Member’s respective Unit Personnel or Pay Branch.
2. Visit DoD Provided Financial Planner
It is a strong suggestion that the Service Member visits a Department of Defense (DOD) provided Financial Planner. Managing money and legal affairs are part of mission readiness. Military OneSource provides strategies on:
- Consolidating and paying down debt
- Saving for retirement or collegereating
- Creating a financial plan that will lead to financial security
They also provide a link to installation legal services that protect you and your family from mishaps.
Ensure all recurring bills or debts (i.e. mortgage and utilities) are addressed with the financial planner to ensure coverage.
A financial planner can also provide advice on programs such as the Savings Deposit Program, a savings account that earns the Service Member 10% interest if the deployment is in a combat zone. For more details, see the following link.
3. National Guard or Reservist Should Contact ESGR
If the Service Member is a National Guard or Reservist, ensure that they contact the Employer Support of the Guard and Reserve (ESGR) if needed.
ESGR develops and promotes supportive work environments for service members in the Reserve Components through outreach, recognition, and educational opportunities that increase awareness of applicable laws and resolves employer conflicts between the service members and their employers.
Ultimately It’s Your Choice, But Take Advantage of All That’s Available to You
Undoubtedly, service members understand that it is their money and they are entitled to spend it as they deem appropriate. However, it is important to note, that the deployment lifestyle only lasts for a limited period. The extra monetary boost that is usually associated with rotations often leads to a “living in the moment” type mentality that can rapidly come crashing down without proper planning.
Conversations with dependents and legal services are needed to ensure proper coverage is provided for recurring debts and future planning. Each respective branch of the military has legal services available to service members to address items such as power of attorneys, wills and other documentation that concerns the execution of financial actions that could affect the service member.
Financial stress is a burden that a lot of service members go through, but by conducting proper financial planning and knowledge, it can be limited and allow them to prepare for life post-deployment.