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By Barbara O’Neill, Ph.D., CFP®, Rutgers Cooperative Extension, [email protected] 

Service members and their families make many financial sacrifices to serve their country. Many reservists and National Guard members, for example, find themselves living on a reduced military paycheck, compared to their civilian income, when they are deployed. There are also those expensive PCS moves between military installations, job transfers that military members can’t say “no” to like private sector workers sometimes can.

U.S. Air Force photo by Airman 1st Class Areca t. Wilson/Released

For military families, relocation is a way of life and the salaries of young military personnel are modest and, in some cases, even qualify families for food stamps and other public benefits. Another financial challenge is managing money from joint accounts when a deployed service member and spouse are in different locations.

Below are nine military-specific financial tips to share with service members:

  1. Prepare for Deployment- Get your financial affairs in order. Suggested strategies include direct deposit of military pay and other regular income, automatic bill-paying, a review and update (if needed) of beneficiary designations on retirement savings plans and life insurance policies, and drafting or reviewing a will.
  2. Practice Living on a Reduced Income– Do this for two reasons: to prepare for reduced income following deployment and to build up emergency savings of three, and better still, six months expenses.
  3. Communicate about Money Matters– Make sure that your spouse knows the location of investments, insurance policies, and important financial records.
  4. Make it Easy to Manage Money– Use direct deposit and automatic bill payment. Deploying service members may also want a duplicate ATM card to make deposits and withdrawals anywhere they are stationed. Designate a trusted friend or family member to contact in case of a financial emergency.
  5. Get Help When Needed– Investigate services available from military family support groups and community agencies. National Guard members or Reservists should inquire if their employer will pay them anything during their deployment. While not required to, some employers continue deployed workers’ full pay or pay the difference between regular pay and military pay indefinitely or for a specified period.
  6. Save Voluntarily in the Thrift Savings Plan (TSP)- Maximize savings opportunities in the TSP, which is the defined contribution retirement plan for service members. The longer contributions are made, the more time compound interest has to build up an account balance. Contribute $200 a month during 20 years of active duty pay status and you’ll accumulate almost $118,000, assuming an 8 percent average annual return.
  7. Know the TSP Rules- Set up TSP deposits via payroll deduction. Contributions are meant to be used for retirement so there is a 10% penalty for withdrawals before age 59 ½. Upon separation from military service, TSP accounts can be rolled over into an IRA or other tax-deferred retirement savings plan or left within the TSP to continue to earn interest until retirement.
  8. Learn About Military Retirement Plans– Know your rights to present and future benefits related to military service. All service members who entered the military after January 1, 2018 are automatically enrolled in the new military retirement plan, the Blended Retirement System (BRS).
  9. Avoid High-Cost Loans- Beware of high-cost loans offered by predatory lenders and other scams targeted toward service members or military veterans. If a deal sounds too good to be true, it probably is. Check it out with a state securities regulator, consumer protection agency, or Better Business Bureau.

Military Consumer Protection Day is held each July to highlight the financial stresses faced by military families. Visit to order free resources from the FTC and more than 35 federal, state and municipal agencies, consumer advocates, and military support groups.