Preparing Your Finances Before Deployment
As you get ready to deploy, coordinating your financial obligations and planning your financial readiness may seem overwhelming. Although bills will continue to come each month, preparing your finances before you deploy will decrease finance-related stress and help you concentrate on the mission.1
Use the money management tips below to prepare your finances before deployment and maintain financial readiness while you are away.
Choose a Financial Overseer
To help you manage your finances while deployed, choose someone to oversee your finances. This person could be your spouse, parent or other responsible person whom you trust to monitor your financial health. Be sure to include them in preparing your finances before you deploy so that they are aware of the financial information they will manage while you are away.
Establish a Power of Attorney and Draft a Will
Check out the Real Warriors Campaign articles, “Managing Financial Challenges During Deployment” and “Planning for Financial Health After Deployment” to help you plan for and maintain your financial health throughout the deployment cycle.
While you’re deployed, it may be necessary for a family member or other responsible individual to make decisions on your behalf. A power of attorney will allow you to legally grant a selected individual to act on your behalf. Before you execute a power of attorney, be sure you establish a clear understanding of the expectations, responsibilities and duration, between yourself and the individual you choose.2
You should also draft or update your will to make sure your property is handled as you intend in case of death. It’s easier for your survivors to manage your assets if there’s a legally-executed will. If you don’t leave a will, your property will be distributed according to state law which may not align with your wishes or benefit your loved ones.2
For assistance preparing your power of attorney or will, contact the legal office at your installation or use the U.S. Armed Forces Legal Assistance locator to find legal help near you.
Update Your Record of Emergency Data and Servicemembers Group Life Insurance Form
Your safety during deployment is important, but it’s also essential to make arrangements for your property and benefits to be transferred in case of serious injury or death. Before you deploy, review your Record of Emergency Data (RED) to make sure it’s current. Also known as Page 2 or DD Form 93, the RED is used to contact next-of-kin, designate a beneficiary to receive certain military benefits and identify an individual to coordinate funeral arrangements. Ideally, you should revisit the form yearly to verify that it is up to date.3 To update your RED, use your Common Access Card to login to your service's personnel system.
Additionally, you should update your Servicemembers Group Life Insurance (SGLI) form, which identifies the legal beneficiary for your SGLI payment in case of death.3 To update your SGLI form, visit the Servicemembers and Veterans Group Life Insurance page.
Understand Your Entitlements
You may be eligible for extra pay through deployment entitlements if you are deployed for more than 30 days.4 To find out if you are eligible for entitlements, check with your unit administrative section or visit Military OneSource before deployment to learn more about your military entitlements.
To learn more about managing your finances and creating a stable financial future, enroll in MoneySmart, a free, web-based financial education program offered by the Federal Deposit Insurance Corporation.
Establish a Budget
Although you may have extra income during a deployment, you and your family should try to live on your pre-deployment income by keeping a spending budget. Members of the National Guard and reserve forces may make less money when deployed and away from a typically higher paying civilian job, so it is particularly important to plan a budget in advance. By following a financial plan, you and your family will be able to save money for emergencies or pay off credit cards and other debt. For help developing a budget, download and complete a Military OneSource Financial Management Plan [PDF 116KB]. Or visit MyMoney.gov for other budgeting tools such as a daily spending diary, monthly payment calendar and a spending plan worksheet.
One suggestion to keep things on track is to establish a separate account for your deployment spending. A separate account can help you manage your pre-determined budget for your spending while you are away and help your family monitor their spending needs easier, which are likely to be consistent each month.4
To help you stick to your budget, set up allotments that are automatically deducted from your pay and distributed on your behalf. Try using discretionary allotments to pay your car loan, mortgage or rent, or to deposit funds into another account such as a savings account. You’re allowed up to six discretionary allotments per month and you can manage them at your convenience.5 For more information on allotments, visit the Defense Finance and Accounting Service website or contact your installation’s finance office.
Pay Your Bills on Time
While you are deployed, you are still accountable for financial obligations at home, including credit card expenses, utilities, rent and mortgage payments. You should meet your obligations in a timely manner to avoid disciplinary actions under the Uniform Code of Military Justice.1 To meet your financial obligations, it’s important that you and your spouse, or designated financial overseer, work together to track a detailed list of your bills and bill payments and establish a plan for meeting these responsibilities.6 Setting up automatic bill payments prior to deployment can help you to avoid late payments and stay on track. For information on arranging automatic bill pay, contact your bank, credit union or other financial institution.
Create a Savings Plan
Deployments are an ideal time to start saving by getting in the habit of setting money aside to prepare for unexpected financial challenges. Prior to your deployment, you can establish a savings plan to follow while you are away. You may be eligible to take advantage of the following savings programs while deployed:
- Defense Department Savings Deposit Program (SDP) provides eligible service members the opportunity to build their financial savings. The SDP offers those serving in designated combat zones the opportunity to deposit up to $10,000, earning 10 percent interest annually.7
- Thrift Savings Plan is a retirement savings and investment plan sponsored by the Federal Government that allows you to make pre-tax contributions to a retirement fund to prepare you for the future.
For more information on saving for your future, download and read “Savings Fitness: A Guide to Your Money and Financial Future,” [PDF 1.36MB] which may help you set financial goals and make saving for retirement, and other priorities, a habit. You’ll learn that it’s never too early or too late to start saving.
Communication with your spouse or financial overseer while you’re deployed is critical to staying informed of your financial readiness. It’s important to establish a communication plan before you deploy so you can discuss how bill payments, major purchases and other financial decisions will be handled. Try the following methods to stay in touch:
- Visit the U.S. Postal Service website for guidelines on sending mail to deployed service members.
- Request a free calling card for a deployed service member from Cell Phones for Soldiers.
Since there may be times when you can’t communicate with someone at home, it’s important to trust your spouse or financial overseer with financial decisions. Communication and trust will help ease financial stress and encourage a financial partnership through all stages of deployment.
Know Your Rights
The Servicemembers Civil Relief Act (SCRA) offers a wide variety of protection and financial relief for active-duty service members, including activated members of the National Guard and reserve, during deployment. The act allows you to suspend or postpone certain financial obligations such as credit card payments, rent or mortgage payments, taxes and other commitments so that you and your family are relieved of financial stress while you are deployed. For more information or to see if the act applies to you, contact your nearest Armed Forces Legal Assistance Program using the military legal assistance office locator.
If you are a member of the National Guard or reserve, visit the Real Warriors Campaign article, “Plan for Financial Readiness Before Deployment” for recommendations on how to improve your financial readiness before deployment.
- Financial Management Awareness Program (National Guard)
- Financial Readiness (Army)
- Financial Resources (Marine Corps)
- Military OneSource: Money Management
- Military Saves
- National Resource Directory: Money Management and Financial Counseling
- Military Family Deployment: How To Prepare, Cope And Recoup
- Personal Financial Management (Navy)
- Personal Financial Readiness (Air Force)
- Q&As About Matters Regarding Pre-Deployment
- What To Do When Deployment Strikes - Financial Affairs, Updating Your Will, Power of Attorney
1 “Personal Financial Management Overview ,” Military Homefront. Last accessed June 14, 2012.
2 “Pre-Deployment Tips,” Force Health Protection and Readiness. Last accessed June 14, 2012.
3 “Why is it important for service members to update their SGLI and vRED?" [PDF 76.6KB] Military HOMEFRONT. Last accessed June 14, 2012.
4 Person. “How Service Members Can Stay Financially Fit During Deployment,” Military OneSource. Last accessed June 14, 2012.
5 “Pay Allotments," Defense Finance and Accounting Service. Last accessed June 14, 2012.
6 “VeteransPlus Program," Last accessed June 14, 2012.
7 “Savings Deposit Program," Office of the Under Secretary of Defense for Personnel and Readiness, Defense Department. Last accessed June 14, 2012.