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    3 Tips to Prepare Your Finances for Deployment

    Deployments change everything. Although you’re busy preparing yourself and your family emotionally, you’ll also want to take time to think about your family’s finances.

    I turned to Carlos Perez, Assistant Secretary for America Armed Forces Mutual Aid Association (AAFMAA), to better understand what it means to financially prepare for a deployment. Carlos served as an Army combat engineer for 26.5 years, to include three deployments. And as a husband and father to four, he knows what it takes to provide for a family financially. Our conversation resulted in three main tips for preparing financially before deployment. 

    1) Review your current budget. 

    You and your spouse should sit down and discuss your current budget. Where is your money going? How much is going to living expenses, and how much is getting saved? How much is free to spend? These questions are particularly important to discuss if the non-active spouse doesn’t already handle the family’s finances.

    Next, talk about where you can cut costs. Consider amenities you won’t need while you’re deployed, especially for service members who are single. Review expenses like your phone bill, auto insurance for a car that will likely sit, cable, and any auto-subscriptions like Netflix, Hulu, Spotify, and magazines. If you know you're going somewhere you can't use these services, cancel them.

    2) Know your entitlements.

    Learn what entitlements you’ll receive, and how they’ll affect your monthly income. You might be eligible for hazardous or difficult duty pay, imminent danger pay, hardship duty pay, and family separation allowance. Learn more about these entitlements through the Defense Finance and Accounting Service (DFAS).

    In addition to entitlement pay, deployed service members are provided access to the Savings Deposit Program (SDP), which exists to give those serving in designated combat zones the opportunity to build financial savings. Your deposits into the SDP will earn 10% annually, and you can see as much as $10,000 in return. Once you return from deployment, the money is then made available for withdrawal. There are guidelines and stipulations concerning the SDP that you can find on the DFAS website.

    3) Create a new budget.

    Once you decide where to cut costs and how much you’ll receive in entitlements, decide what you’ll do with the additional income. Consider using your cash in these three ways.

    Build an emergency fund.

    If you don’t already have one, set aside three to six months of living expenses. Although unemployment isn’t a pressing concern for service members, misfortunes do happen. Cars break down, and expenses appear out of nowhere. An emergency fund helps avoid a trap of consumer debt through credit card spending when unexpected costs arise.

    Pay off debt.

    After you establish an emergency fund, attack your debt. Start with the highest interest or delinquent debt and work your way down.

    Save and invest.

    Talk with your spouse and discuss your priorities. One might want to save, while the other wants to pay for a much needed vacation. If you can't do both, figure out a compromise and save what you can. However, it’s always a good idea to prepare for your retirement.

    The new Blended Retirement System is great when you capitalize on your contribution to the Thrift Savings Plan; however, it’s always a good idea to prepare for retirement with additional investments through companies like AAFMAA, USAA, Navy Federal, etc.

    You can also work with any of these companies to increase the service member’s life insurance in preparation for deployment.

    If you have children, consider investing a portion of your entitlement pay for your children’s college tuition. It's never too early to start saving!

    As deployment approaches and you prepare yourself emotionally, remember to also plan financially. Deployments are a great opportunity to increase your savings for the future, so keep these tips in mind to help capitalize on the additional income you receive.

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    Danielle Keech


    Danielle Keech

    Danielle is just like you — another down-to-earth military spouse learning every day how to navigate the craziness. As a mama of two, she knows what it takes to juggle solo parenting, a work-from-home career, and the demands of military life. She’s a firm believer that community is a key part of thriving and hopes to remind readers that they’re not alone through her writing. Want to connect? Find Danielle on Facebook, Instagram, Twitter, and LinkedIn.

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