Tag Archives: budget

Military Advance Pay: Caution! It’s Not a Pay Day Loan

Another government ordered move and you are short on cash. You tried to save extra money in a moving fund, but these orders arrived quicker than you expected. You have a great job and your income is a big part of your family’s budget. What will you do?

A little-known provision of military pay is called “advance pay.”

Advance pay is neither an entitlement, nor a guarantee, but may be an option your service member can request, if there is a need, before, or shortly after, a PCS.

Advance pay is a type of pay available to help offset the cost of a move and cover extraordinary expenses such as: loss of a spouse’s income, down payment on a home, or cost of maintaining two households. Advance pay is just that – an advance of your service member’s basic pay.

DoD Instruction 1340.18 provides the nitty-gritty details about advance pay. A service member may be eligible to apply for 1-3 months of advance pay, and the repayment period ranges from 12-24 months. A service member can make a request to receive advance pay 30 days prior to a PCS, or 60 days after a PCS.

The service member’s administrative department can help process the necessary paperwork, form DD 2560. Remember, you must be able to demonstrate why the funds are needed. A shopping spree, or a new pool, does not count as an unmet need. Your service member may be asked to complete a budget, or financial worksheet, outlining the additional costs related to the move.

If your service member requests more than 1 month of basic pay, the request will need to be reviewed by the service member’s immediate command. Likewise, if you request a repayment period exceeding 12 months, the service member must justify the extended payback period.

Cautionary tips:

  • Advance pay is an interest-free advance of the service member’s basic pay and must be repaid. This means the service member’s pay will be reduced each month during the repayment period.
  • Advance pay must be repaid, even if the service member voluntarily or involuntarily separates from the service. You borrowed against your future earnings and must pay it back.
  • Your advance pay is taxable income, and may impact your income taxes. Be sure to consult with a tax professional to review your specific situation.

Personal stories from families who have applied for advance pay suggest having your justification and supporting paperwork ready. Many families are able to receive 1 month of basic pay with a 12 month repayment period. Anything beyond 1 month of pay and a 12 month repayment may require additional financial counseling and documentation. Be sure to fully understand the cautionary notes before your service member requests advance pay.

Have you requested advance pay? How did it impact your family’s PCS budget?

katiePosted by Katie Savant, Government Relations Information Manager

Are You Taking Advantage of Your Military Discount?

target-shopping-cartMilitary discounts are a great benefit offered to military families and retirees. You may have gotten into the habit of asking for a discount when you go into a restaurant or a store, but if you don’t, you should! Military discounts are also available when you shop on the internet – who knew?! Follow these tips to get the most for your dollar.

Be clear on the discount policy
Unless you regularly shop online, you may not be aware of the discounts available. Sometimes you have to hunt for the offers in small print, while other e-retailers proudly feature their policy for all to see. Some offer savings around military holidays such as Memorial Day, and others, like Lowe’s and Home Depot, offer discounts year round. When in doubt, ask!

The most common military discount is 10 to 15 percent off a total purchase. Home improvement stores, hotels, car rental agencies, clothing chains, and vehicle dealers are among the most reliable source places to save money with discounts. Some only offer savings to active duty members, while others extend it to retired service members and immediate family members.

Check coupon stacking policies
Always check the policies related to ‘stacking,’ or combining, online coupons. That’s one of the best ways to save. You might be able to combine a special holiday sale with savings from your military ID, store loyalty card points, or specific credit card bonus points. However, some retailers only allow a choice of military discount, or a special deal with a coupon from coupon websites. But that’s okay, savings is savings, right?

Look for price-matching opportunities
One of the easiest ways to save money when buying online is to take advantage of price matching policies. A store will match a competitor’s price online with some limitations: the item must be in stock at both stores, for example, and online auction sites are usually not considered competitors.

Use discounted gift cards
Another relatively new savings strategy is the use of discounted gift cards. In a nutshell, people who don’t want, or can’t use, specific gift cards will sell them online through a reseller. Why not use a $100 gift card you bought for $90? It’s like getting an instant 10% off! Be aware that scams abound in this growing market. Avoid buying gift cards on online auction websites, as they could be purchased with stolen credit cards. Stick to established resellers like Cardpool, Raise, and Card Hub.

AAFES/Exchange price-matching
Check with AAFES website, or your branch’s exchange website, for more savings and free shipping offers. You can often use manufacturers’ coupons, buy-one-get-one deals, and price matching. If you choose to use a credit card, the Military STAR card can also offer discounts and free standard shipping from e-retailers.

Military post office shipping
Amazon, Best Buy, Target, and Oriental Trading Company are among popular companies who ship to APOs and FPOs. However, many e-retailers don’t ship to military addresses because they lack an automated system to handle the Customs requirements. Consider shipping to a family member and using a forwarding service such as ShipitAPO or APO Box. If possible, you can also get free shipping by picking up an item in the store.

Protect yourself online
When shopping online, you’ll have to prove your military status to get a discount. Scanning and uploading your separation documents (DD214), Veterans Identification Card, or military ID can make you vulnerable to data-grabbing. This is especially true if you have an older card that lists your social security number. Reduce your risk by calling the 800-number. Also consider enrolling in an ID protection program, or with companies offering centralized shopping privacy protection, such as Veterans Advantage. Check your credit report for free once a year.

Your military family status offers you a world of discounts – you only have to ask and exercise reasonable caution to reap the rewards!

Have you scored big on savings with your military discounts? Let us know your tips and tricks!

Posted by Marie Hickman, a former military spouse and blogger specializing in saving money, personal finance, and frugal living. She writes for Valpak.com and other websites.

The Budget is a Game of ‘Survivor’ for Military Families

Spouse Summit 2014 3“Why are we cannibalizing ourselves?”

As I looked around the table at Military.com’s Spouse Summit, I found myself in a heated discussion with eight courageous, committed spouses, including a Military Spouse of the Year who cares for her husband who has a traumatic brain injury, a woman who works for the Department of Veterans Affairs, and another one who created an online blogging community for military spouses.

Our mission was simple – or was it? Rank 15 military family benefits from most important to least, cutting the 5 that we deem least important altogether.

My table was all women whose spouses have 6-10 years of service. The caregiver spouse voiced her desperation to keep non-medical counseling and other family service programs that have helped to guide her family. Some were ready to cut the Post-9/11 GI Bill for spouses and kids, while others thought it was more important than Basic Housing Allowance (BAH).

spouse summit 2014 2Across the room, a senior spouse questioned our desire to help pay for our kids’ college education, “How many of us paid for college ourselves?”

Most people raised their hands.

Though every cut hurts, it’s the slash after slash that leaves us bleeding. Whether I prioritize Commissary benefits over guaranteed pay raises or retirement benefits… it all comes out of the same place: our pockets.

“Why aren’t other government agencies doing this same thing? Having this same discussion?”

Are employees of the Treasury or the Federal Trade Commission having roundtable discussions about what benefits they’re willing to sacrifice to balancing the budget? Are they facing cuts at all?

Why does it feel like we’re on an island all alone, left to ration what little we have left? Why are we always putting ourselves on the chopping block?

What benefits do you think are most important? Share them with us in the comments or go a step farther – write to the Military Compensation and Retirement Modernization Commission (MCRMC) and tell them your story!

shannonPosted by Shannon Sebastian, Online Engagement Manager

Saving Money on a Military Income: It CAN be Done!

piggy-bankWhen it comes to saving money in a military household, most of us wonder where all this “extra money” is supposed to come from…especially for families in the enlisted ranks. When I was a new military spouse, my husband and I lived paycheck to paycheck. There just didn’t seem to be any other way to do it. How could we save money if there was barely any money at the end of the month?

Like myself, I think many military families may have trouble figuring out where to start, and how to make life something other than ‘paycheck to paycheck.’ And what if an emergency happens? Just charge it to a credit card, right?

Then I learned otherwise.

On a quest to get serious about our financial well-being, my husband and I paid off over $17,000 of debt in just 14 months. All by learning how to save. We followed Dave Ramsey’s Financial Peace University. The trick we used was simple: don’t spend money.

WAIT. Hear me out!

We simply cut back on things that didn’t seem necessary: eating out every day for lunch, buying new clothes just because they’re on sale, or swinging by Starbucks on cold mornings. Oh, and using our debit cards.

Yep. We started using cash for everything.

With certain techniques, we learned to spend less, and save more.

Save Money for the Fun Things
Instead of impulse shopping with money you don’t have (i.e., credit cards), save your money for big purchases. This will give you time to shop around for the best deals, and may even give you time to think about whether what you’re buying is really necessary.

And there’s something to be said about paying for things in cash. Try it sometime and see how it makes you feel. Yes. Feel those feelings. Spending a crisp $50 bill feels a bit different than swiping your debit card. And TWO crisp $50 bills? That hurts! Ok, it doesn’t literally hurt, but you get it.

But Don’t Forget About the Future
Experts like Scott Halliwell, Certified Financial Planner™, with USAA says, “You need to save money for your future.

And he’s not just referring to retirement. Most military families don’t think long term about financial readiness. A Thrift Savings Plan won’t cover everything.

Scott explains, “No matter your age, there is one thing nearly everyone can count on: Your income probably isn’t always going to cover 100% of your wants and needs all the time. As a result, you need to save money today so it’s available down the road.”

My husband and I took this tip very seriously. When we started our financial readiness journey, getting a solid ‘emergency fund’ in place was the top priority. Each pay period, when we had extra money, we put it into our savings account until we hit $1000. It’s grown exponentially since those first days.

We also have a mutual understanding that Emergency Fund money is for just that: emergencies.

Saving money, in any fashion, is one of the smartest things you can do for your military family, in my opinion. What if BAH goes down? How will you cover your off-post rent? If TRICARE requires military families to pay more out of pocket, how will you buy yourself a pair of glasses? With money saved for the future, little ‘emergencies’ seem to be just an inconvenience, instead.

We live in a world where happiness seems to be associated with “things.” Remember: life isn’t about keeping up with the Staff Sergeant next door, and with a savings plan in place, you won’t have to!

Do you have any financial success stories or tips? Share them with us!


shannonPosted by Shannon Sebastian, Online Engagement Manager

Special Operations Forces: A War Weary Community Needs Support

air-force-special-ops

When Secretary Hagel dropped his budget proposals in February, it did not recommend cuts to US Special Operations Command (SOCOM). As a spouse who spent over a decade living the Special Operations Forces (SOF) family life, I can say I am relieved that they will not suffer direct budget cuts, but this also carries with it a significant amount of worry. No cuts, means the same or more missions, right?

You see, while SOCOM funds SOF missions, the programs that support families and dependents are provided by the “big” Air Force, Army, Marine Corps, and Navy. SOCOM’s service members will be equally hurt by low pay raises, decreased Basic Housing Allowance (BAH) and changes to TRICARE. As “big Service” budgets get smaller, and the operational tempo for SOF families continues or increases, where will they get their support?

In 2010, Admiral Eric Olson, then Commander of SOCOM, initiated a study of SOF warriors and their families and was able to document a “fraying” of the force with strong data. Admiral William McRaven turned those concerns into Preservation of the Force and Family (POTFF). POTFF primarily helps the service member focus on physical, spiritual, mental, and social issues. Of course, this assists the family as a whole, but POTFF programs aimed at the families are limited because of legal restrictions on who SOCOM can spend money on and how.

I have loved the idea of POTFF since its inception. I was part of those who were studied in 2010. I KNOW this fraying. I knew that I needed to do whatever I could to help future SOF spouses avoid the fraying that I felt for many years.

I am terrified that budget cuts to the programs provided by the Services will devastate everyone, but particularly SOF families because while the war draws down in Afghanistan, the SOF mission does not.

SOF families endure operational tempos and unpredictability in an unending cycle. Resiliency is NOT optional, and it comes at a cost. There were years when I had friends ask me if I was happy, and I could only answer, “I will be, when he’s home.” That routine lasted and lasted–it was the ‘SOF life.’

I can say that I am stronger than I ever imagined I would or could be, but I still cry for the new mom who, despite being a SOF spouse for three years, couldn’t see the light at the end of the tunnel.

The family programs offered at our installation were stellar, but the amount of people deployed at any given time and in constant rotation needed far more manpower than the military family programs could offer. Our Airman & Family Readiness Center was staffed for the regular Air Force mission, not SOCOM’s.

So, now with Air Force, Army, Marine Corps, and Navy budgets shrinking, while SOCOM’s remains unchanged, what happens to those spouses and families? Of the 1% who serve in the military, 67,000 are in SOF units – a remarkably small, but growing number. The vision for the future of SOF is one of expansion. The stress will not decrease for these families. They have not and will not get a break. Our SOF families NEED adequate support for their growing missions from the Services, Defense Department, and Congress.

We are war weary – don’t forget us and the unique mission our service members provide within the military community.

Brooke-GoldbergPosted by Brooke Goldberg, Government Relations Deputy Director

Set a Goal. Make a Plan. Save Automatically.

military-saves-weekMilitary Saves Week starts February 24 and runs through March 1. In the weeks leading up to and including Military Saves Week, many installations host programs and events that focus on saving. I’d like to take this opportunity to encourage you to attend one of these events. Why? I know many join the military because it provides a steady dependable paycheck, and if a service member stays in for more than 20 years, the retirement pension is guaranteed at a set and predictable rate. However, recent events (cuts to the COLA, a 1% pay raise for 2014, and proposed changes to the commissaries) show how uncertain those guarantees are. We are all one congressional vote away from any change to the benefits packages that were offered when our service member signed up.

It’s simple, really. Like the old saying goes, “The only guarantees in life are death and taxes.” I’ve said before that as military families, we prepare for the worst and hope for the best. This is just as applicable in your financial life as it is anywhere else. So, if you get that retirement pension for military service, great! This does not negate your responsibility to save for your retirement. Make sure you are using the Thrift Savings Plan (TSP), use the Savings Deposit Program (SDP) during deployments, and open up a Roth IRA (yes, I said “and,” it’s called diversification). There are a million ways to save your money to ease your long-term financial worries and burdens, and that means a more peaceful and enjoyable retirement. Don’t we all want that, especially after living a military life?

On that note, I will point out that not everyone who joins the service will stay in for 20 years or more. In fact, only 17% who serve end up making it to retirement. So, savings should start as early as possible and as often as possible. Another old saying tells you to pay yourself first. Find 10% of your income to pay (to yourself) in a retirement account. The earlier you start, the more money you will have at retirement because those first dollars grow the most.

One more big point I want to make is for you spouses, yeah, you, the one who is keeping the checkbook balanced, holding down the homefront, or running around like a chicken without a head, savings is also for you! There is no reason why all of the retirement and savings needs to be in the service member’s name or in connection with their employer; get some savings in your name, too. I am not implying that your marriage is on the rocks. I am reminding you that life happens, and facilitating your ability to take command of the ship if you need to, is part of having a secure family. You deserve to have assets, savings, and a nice credit score, too. These are all important factors for long-term financial success, regardless of whether you are inseparable for life.

Military Saves has a great motto this year, “Set a Goal. Make a Plan. Save Automatically.” Their website has tools and resources for you to learn how to save smart and make the most of your financial power. Take some time this month to learn more about how you can build your family’s wealth!

Have you considered savings as a spouse? Share your thoughts!

Brooke-GoldbergPosted by Brooke Goldberg, Government Relations Deputy Director

Some are All Talk…We’re Not!

Girl-with-Yellow-Ribbon“Our Association’s highest priority is to fight for military families. We fight to protect the programs and services that allow them to meet the challenges of military life and maintain readiness. Our Nation’s leaders cannot ignore the promises they made to those currently serving as they prepare to shape the force of the future.”

Each year, the National Military Family Association develops our Legislative and Policy Priorities list. We don’t do it in a vacuum. We incorporate the concerns we’ve heard from military families. We listen to what our volunteers are telling us from the field. We look at gaps in legislation that has already been passed. We dust off some issues that we’ve promoted for years. We beat the drum on the need for sustaining the programs military families use that work. We seek advice from our Board of Governors and other experts.

This year we paid special attention to the uproar on social media when the Cost of Living Adjustment (COLA) for retired pay was reduced by one percent, as well as when military families were impacted by sequestration and the government shutdown. We heard you loud and clear! Our military families and their service members never fail to answer the call. In return, our government has promised to provide them with the resources to keep them ready. You asked Congress to #KeepYourPromise, and in our priorities, we ask Congress and Department of Defense (DoD) to do just that.

We ask Congress and DoD to guarantee, and sustain, the resources necessary to safeguard the readiness of military families. Like protecting the commissaries, where savings are such an important part of compensation. And ensuring access to high quality health care and preventive health care services. Our families are still healing from over a decade of war – they need medical and non-medical counseling readily available. Our kids have served, too – make sure the schools they go to thrive with help from Impact Aid and DoD grants and supplemental aid. Although the wars are winding down, don’t forget the wounded and their caregivers, who still face the uncertainties of their recoveries or the new realities they must deal with as a family.

There are some areas where the readiness of our military families can be improved and refined. We need more forward motion on standardizing programs for families with special needs across the Services. Enhance the spread of information about tools to help military spouses with education and employment. Some families need to be better equipped to react to the stresses of military life that can result in domestic abuse, child abuse and neglect, and sexual assault. Help them negotiate the confusion of installation, State and Federal agencies. Our survivors need to be able to receive all the benefits they are entitled to – end the Dependency and Indemnity Compensation offset to Survivor Benefit Plan. And how can we better prepare those families who are facing an end to their military service, through their choice or the government’s, while they are still serving? How do we help them negotiate a successful transition to civilian life?

I’ve just given you a quick overview of our priorities’ statement – the Association Legislative and Policy Priorities for for 2014. It gives us a starting point. By no means do we limit our advocacy to these few issues. We expand on it for our statement to the Armed Services Committees. We refine it when necessary to shine a light on a specific issue or policy. Read it over and let us know what you think. And please know that we are always ready to address issues affecting military families as they arise. We fight for you and for all military families.

What would you tell Congress and DoD are most important? What’s your military family story about one of the issues we’ve outlined above?

kathyPosted by Kathleen Moakler, Government Relations Director