How to Thank and Help Our Future Veterans

November 04, 2014

With Veteran’s Day around the corner, we stop to thank those, past and present, who have served our nation and protected our freedoms. We all know that they volunteer to spend time away from home and family and risk their lives to keep us safe. The tragic stories of service members suffering from PTSD and life altering injuries tear at our hearts. What no one talks about is the financial hardships that many of our service members face. 

The military culture is very young, very male and very risk-taking. That is a good thing for the jobs they are asked to do, but those traits can be counter to those that lead to good money management. Even when military personnel are given the opportunity to learn about money, it is usually during basic training when they are mentally and physically exhausted, plus they haven’t started to receive their military pay or signing bonus yet. Another common time is immediately prior to or following a deployment, when their thoughts are on time with their loved ones.

Payday loans can particularly be a problem. While the education efforts are better than they were before, are we losing the “War on Payday Loans?” If you don’t believe me, check out the map when you Google search payday loans near Ft Sill, OK, an Army base in Lawton, OK with catchy names that include Cashland, Cashmax, CashExpress – just to point out a few. It is VERY easy for a young service member who faces the same challenges that many of us do with money, especially at such a young age, to make mistakes.

The worst part is that their military career makes the debts they may incur even more damaging.  The most common reason that service members can lose their security clearance is bad credit.  Without that clearance, their career is jeopardized so once a soldier, sailor, airman or marine signs the dotted line for that new car, truck, etc., they are risking their career if they can’t pay that loan.

The problems are across all branches of the service and all statuses.  Many members of the National Guard and Reserves have had problems getting hired over the last decade as frequent deployments made them risky for small businesses to hire.  Those warriors often started a vicious cycle of volunteering to deploy because they couldn’t find a job, then spend down that money while looking for a job and can’t find one so deploy again, etc.  That was doable until the wars slowed down and now there are no new deployments but they had years between regular work on their resume…not to mention the impact that feast and famine cash flow can have on family finances.

Fortunately, there are resources to help. Every installation should have a “personal financial management specialist.”  Any service member can also access a host of resources at www.militaryonesource.mil. If they deploy to a combat zone, let them know that they can contribute to the Thrift Savings Plan (TSP – the government’s retirement plan) in the Roth version and that money will NEVER be taxed, now or at retirement, since combat pay is nontaxable income to begin with.  They can also have their interest rates on previous loans capped at 6% and save up to $10,000 per deployment in the Savings Deposit Program and earn 10% guaranteed by Uncle Sam.

So this Veteran’s Day, thank the veterans in your life and if you know anyone currently serving in armed forces, let them know the financial resources available to them. I’ll be thanking my stepson who currently serves in the Army Reserve.  They deserve our thanks, admiration and support and they deserve a better opportunity at financial wellness!