Serving Your Financial Future: Financial Considerations and Questions for Military Families
As a military family, you face challenges and opportunities in managing your finances. Planning for your financial future is important, regardless of where you are in your journey. Here are a few key financial considerations for military families.
Understanding Your Benefits
First off, think of all those special benefits that military families see over the years – basic allowance for housing, a Survivor Benefit Plan, Tuition Assistance, and Montgomery GI Bill benefits.
Do you know what benefits are available and how to take advantage of them?
- Do you understand all the benefits available to your family?
- How might you enjoy these benefits to save money and plan for the future?
Creating a Budget
A budget makes you aware of where you’re spending money and helps keep you from spending more than you earn. As a military member or a military family, income may change due to deployments, moves, or promotions. A budget helps you plan for these changes. When creating a budget, consider these questions.
- How might you track income and expenses?
- How may you adjust your budget to prepare for changes in income?
Saving for Emergencies
Life in the military is volatile, so you should be prepared for the unexpected. An emergency fund is money you save for life’s surprises, such as car repairs, medical bills, or a major home repair. In general, you should strive to set aside enough to cover three to six months of your expenses.
- Do you have an emergency fund?
- How much should you save to use in case of an emergency?
Planning for Retirement
Retirement might seem far away, but it's never too early to start planning. For military families, your retirement savings plan is called the Thrift Savings Plan (TSP). This plan is similar to a 401(k) and offers several investment options.
- Are you contributing to your TSP or another retirement account?
- How much should you save each month to ensure a comfortable retirement?
- What should you invest in?
Managing Debt
With all the job limitations and uncertainty of military life, debt might seem insurmountable. Whether it’s accrued from credit card use, student loans, or a mortgage, it’s worth having a plan to repay it.
- What debts do you have, and how much do you owe?
- What is your plan for paying off your debt as quickly as possible?
Saving for Education
The GI Bill provides an education benefit, but it won’t fully cover all costs. Are you OK with that?
- Are you saving for your children’s education?
- What are some options available to pay for your college education, like the GI Bill?
Preparing for Relocation
Military moves may be expensive. Planning for transitions ahead of time might alleviate some of this stress. Consider these questions.
- How might you save money for your next move?
- What financial preparations may you make to handle relocation smoothly?
Getting Help from a Financial Professional
It may be helpful to speak with a financial professional who works with military families and explore the military family support center, which provides free financial counseling.
- Should you talk to a financial professional about your family’s future?
- How might you find a financial professional who understands military life?
Military families often take a more systematic approach to planning financial futures so they could think about their benefits, draft budgets, set up savings plans for rainy-day funds, and consider various “what-ifs” about retirement, education, and future moves.
Important Disclosures:
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.
This article was prepared by WriterAccess.
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