How to Reset Your Budget During a PCS Move
Military families all over the world are moving this summer, and hopefully many of them will take advantage of this opportunity to reset their monthly spending plans.
Since many of the biggest expenses in a monthly budget are non-negotiable costs, a Permanent Change of Station move (PCS) is a great time to make less expensive choices for the next few years.
How to Save on Housing Costs
For most military families, housing and associated expenses are the largest single ticket item in the budget. (Thankfully, because that means it isn’t health care!) If you’re in the U.S., saving money on rent or mortgage payments equals straight cash in your pocket because the amount of BAH you receive isn’t based on the cost of your housing.
Be sure to consider utilities when you choose your housing. A smaller or energy-efficient house can provide real monthly savings on your gas, electric, and water bills. Do a little research into utility costs while house shopping, and consider the details of the home. How is it heated: electric, gas, propane, something else? Does it have any specific features, like high ceilings or a hot tub, that will impact your utility bills? Is there more than one option for internet, or are you stuck with the single provider?
Utilities are also a place that military members can save money even when they are living overseas. Maybe you can get an enormous home with your Overseas Housing Allowance, but how much is it going to cost to keep it warm or cool?
If you're considering buying a home, be sure to factor in the costs of maintenance. Homeowners are responsible for so much that renters don’t have to pay: regular maintenance such as gutter cleaning, pest control (depending on your lease), and tree trimming, ongoing repairs such as appliances, plumbing, and electrical, and then larger upgrades as necessary, like kitchens and bathrooms. There’s even the smaller stuff that you want to do in a home you own, but you’d probably skip in a rental: really good window coverings, nicer landscaping, and tiny upgrades like built-in storage in the entry or a non-neutral paint. Even small costs of homeownership add up.
Consider Transportation Expenses
Total transportation costs are often underestimated because they dip into so many other categories: car loan, insurance, maintenance, tolls, parking and gasoline often come out of different buckets of money. And you have to include the costs of public transportation, if you use it.
When you move, take a few minutes to figure out how a home’s location will impact your total transportation costs. Is there a toll road that you’ll be taking regularly? How much will an extra 15-mile commute increase your insurance, gasoline, and maintenance costs? Is the home closer or further from your other activities besides work?
Another way that transportation costs can change with a PCS move is when you buy or sell a car. If you need to purchase a car, the car you choose to purchase can make a huge difference in your financial life. The purchase price, whether you finance anything, gasoline consumption, insurance, and maintenance costs can vary widely.
Obviously, a $1500 Civic is going to leave you with more money than a $50,000 new car. But something as simple as choosing a car with significantly better gas mileage can be significant as part of your overall budget. On the flip side, living close to work and activities might mean that you can squeeze a few more years out of that older car, or cut down to one car.
Other PCS Expenses
It’s surprising how many other expenses are impacted by your home’s location. Are there great public schools, or will you consider paying for private education? Are there lower-cost grocery options nearby, or will every shopping trip be at a full-price supermarket?
Does the town or neighborhood have lower-cost options for amenities that are important to you, like a swimming pool? Will you be close enough to the free base gym, or will you purchase a gym membership? Every little bit adds up!
It’s pretty rare that you’ll find a location where all the less-expensive options come together. More often, you’ll need to compromise. Maybe a house closer to work and activities is more expensive, but you won’t spend hundreds of dollars a month on gas. Maybe the next town is cheaper, but you’d have to send your kids to a private school. Take advantage of a PCS move to weigh out all the factors to find the right combination that balances your financial needs with your life priorities. And happy moving!