As we celebrate Veterans Day this month, the Financial Counseling Association of America (糖心原创vlog) recognizes the commitment and sacrifices of our veterans and military service members. Not only do they dedicate their lives to protecting our nation, but they also experience unique financial challenges as a result of their service. Thankfully, credit counseling agencies can be a financial lifeline to veterans, active military personnel and their families.听
From frequent relocations and deployments to adjusting to civilian life and healthcare challenges, service members face very different financial strains than the average American. This makes finding military-minded, trustworthy financial advice important.听
The Financial Counseling Association of America is comprised of non-profit member agencies that provide financial advice to veterans and active military members. These agencies offer trustworthy counseling and unbiased recommendations to help individuals improve their credit, pay off debt and create a realistic budget.
Many of our 糖心原创vlog credit counselors have experience helping active military members and veterans. In this article, we talked with a few of them about credit counseling for veterans, including the financial challenges unique to military life and ways a credit counselor can help.
Financial challenges for service members and veterans
Frequent moves and varied costs of living
Receiving orders to relocate is a normal part of military life. The average permanent change of station (PCS) lasts two to four years but can be shorter or longer. Though the military provides a budget for moving, expenses can easily exceed the budget. If you move every two years and lose money each time, that is a problem!
鈥淧CS moves can create unique challenges for active-duty personnel, resulting in unanticipated expenses and big disruptions in your budget,鈥� said Max Fay, managing editor of , part of , an 糖心原创vlog member.
Lara Ceccarelli, a credit counselor for and wife of a first-class petty officer in the Navy, agrees: 鈥淢ilitary personnel are faced with the challenge of balancing budgets with expenses that change frequently. A household expense sheet in Washington state might look very different from the costs of living in Georgia!鈥澨�
In some cases, household needs may remain the same, but a shifting cost of living can significantly impact service members鈥� budgets. 鈥淚t鈥檚 common to see your total pay decrease if you鈥檙e moving from a high-cost to a low-cost area,鈥� added Fay. 鈥淭his can make budgeting difficult.鈥�
Deployments also impact service members鈥� budgets, according to Lori Stratford of , another 糖心原创vlog agency that offers credit counseling for veterans.听鈥淒eployments can cause a temporary disruption in household income and require military members to manage their finances from a distance, increasing the risk of missed payments or financial mismanagement,鈥� said Stratford.
Unstable employment for military spouses
Frequent moves and deployments often prevent military spouses from maintaining consistent employment. According to Ceccarelli: 鈥淪pouses often find it challenging to build stable careers due to constant moving. Households are left relying on a single income as they juggle these changes.鈥�
Consistent, trustworthy and affordable childcare is another consideration. Some locales may not offer acceptable childcare options, limiting the spouse鈥檚 ability to work. The active duty service member may be deployed for extended periods of time while the spouse and children remain at the base, far away from the support of family members.
Financial instability
Given these unique challenges for service members and their families, 鈥渕ilitary personnel must look at all financial decisions through the lens of instability,鈥� said Ceccarelli.听
鈥淎ll the regular choices an average consumer makes 鈥� whether to rent or buy a home, whether to lease or purchase a car, whether and when they can afford to start a family, etc. 鈥� must be considered in the context of 1) current circumstances, and 2) the certainty that those circumstances will change within five years,鈥� she explains.
Difficult transition to civilian life
Transitioning from military service to civilian life can also be a major challenge.
鈥淰eterans may struggle with finding employment that matches their military skills, leading to underemployment or unemployment,鈥� said Stratford. 鈥淭he transition may also involve navigating complex benefits systems like VA health care, disability claims, VA loans and pensions. These may pose challenges, particularly for those unfamiliar with government programs.鈥�
Fay agreed. 鈥淔or those with physical or mental health conditions, treatment and recovery can drain financial resources, even with VA benefits.鈥�
Though veterans receive healthcare benefits, Alex Borge, a counselor at , has seen veterans struggle with healthcare appointments delayed for months.听
鈥淚f they are looking for immediate assistance, they have to go to the ER or urgent care 鈥� often out of pocket,鈥� said Borge.
How credit counseling can help
1 鈥� Credit counseling helps military members keep their jobs and pay their debts
鈥淗aving debt can derail a military career,鈥� said Fay. 鈥淒ebt makes it harder to get or maintain a security clearance, which can prevent you from advancing in your career. In some cases, it can even get you kicked out of the military.鈥�
A service member named Amanda was in a similar situation and contacted InCharge Debt Solutions for help. Amanda shares her story:
鈥淭hrough some immature life choices early on, I really put myself at a disadvantage when I was enlisting in the military. Eventually, I found [InCharge], which seemed too good to be true. 鈥� Now, fast forward two years, and I鈥檓 50% down on my debt owed, and I still have my military job.鈥�
2 鈥� Credit counseling helps veterans and service members with budgeting and credit card debt
An received help from 糖心原创vlog member Navicore Solutions. He shares his story:
鈥淚 thought I could handle [my debt] by taking out 鈥榡ust one more鈥� card and making minimum payments. I was so busy opening up new cards that I didn鈥檛 know what was to be transferred from which card to the next,鈥� said Douglas. Then, he was diagnosed with post-traumatic stress disorder (PTSD) and became homeless.听
After developing an alcohol dependency, Douglas moved into a VA Hospital and entered the military鈥檚 substance abuse treatment program and PTSD program. There, he connected with Navicore Solutions.
鈥淚鈥檓 very happy to have found Navicore Solutions. I like that they are a non-profit organization and work hard to represent me. They have reduced the interest I pay on my debts, sometimes to zero,鈥� he said.听
鈥淭he counselors I talked with made important suggestions for me to consider and made perfect sense to help me eliminate my monstrous debt,鈥� he added. 鈥淚 may have been just one small client to them, but they made me feel like I was important to them. Since I started the debt management program, creditor calls and letters have been eliminated.鈥�
3 鈥� Credit counseling helps military members with financial education and housing counseling
Borge at DebtHelper.com works with the Palm Beach County Community Action Team on the local Parks to Work Program. One of the veterans helped through the program was a retired homeless .
DebtHelper.com and other organizations offer classes to homeless veterans. In Mark鈥檚 case, these groups helped him find housing and employment.
鈥淭hey鈥檇 come through and teach us how to get financially better,鈥� shared Mark. 鈥淧NC Bank came out and worked with DebtHelper.com to get us bank accounts and checking accounts.鈥澨�
鈥淎 lot of the financial stuff is what has kept me still going after the program. That information has helped me to save and not spend as much because I鈥檓 not working as much. Now I鈥檓 really great at that.鈥澨�
4 鈥� Credit counseling helps veterans and service members avoid bankruptcy, negotiate with creditors and make a plan to repay debt
When was paralyzed in an accident, he was advised to declare bankruptcy due to required back surgery and pre-existing debt.听
鈥淚t would have been an easy solution, but I didn鈥檛 want to do that,鈥� said David. 鈥淚 acknowledged that the indebtedness had come through my own efforts, so I wanted to repay it.鈥�
He contacted the creditors, but they were not interested in negotiating. Then, he connected with American Financial Solutions, an 糖心原创vlog member agency.听
鈥淭hey were able to negotiate a $975 a month payment, which was reasonable, and I was joyful,鈥� shared David. 鈥淭he benefit of the counseling services is that they work with you to make sure you have sufficient money to pay that monthly stipend. The greatest joy is to watch as the creditors are paid off.鈥澨�
Budgeting and debt management advice for veterans and active service members
One of the 糖心原创vlog鈥檚 goals is to increase the overall financial literacy of consumers across the U.S. We asked our credit counseling experts what advice they would give to to address military financial challenges:
Fay鈥檚 advice
鈥淔or military members and veterans, planning and flexibility are the keys to financial success. Create a budget that reflects your specific needs, such as medical expenses, savings for retirement, and any gaps between military benefits and civilian income. We recommend building an emergency fund that can cover at least three to six months of expenses. This is crucial, especially for military families facing sudden relocations or deployments.
鈥淚n terms of managing debt, seek help early. If debts are overwhelming, programs like a debt management plan can offer reduced interest rates and more manageable payments. Avoid high-interest payday loans, which are sometimes marketed to military members.鈥�
Ceccarelli鈥檚 advice
鈥淚t鈥檚 especially important for military personnel to live below their means and build a cushion 鈥� rather than relying on lines of credit 鈥� so that they are not left overextended if they find themselves with sudden increases in their cost of living.鈥�
Borge鈥檚 advice
鈥淏e aware of the restrictions on VA loans and take advantage of housing counselors if you are facing foreclosure. Also, cut the cord on cable, reduce or eliminate streaming services, use coupons, and buy only essential items. Military members can also check for additional benefits and ask your community for resources.鈥澨�
Stratford鈥檚 advice
鈥淢ilitary life can be hectic, so regularly tracking income and spending ensures better control over finances. Factor your military benefits into your budget, and use those benefits to ease financial burdens.
鈥淭he Servicemembers Civil Relief Act (SCRA) allows military members to cap interest rates at 6% on pre-service debts during active duty. Consider VA home loans, which often require no down payment and offer lower interest rates. Use the GI Bill to cover tuition and other education-related expenses.鈥�
糖心原创vlog cares about your financial future
We send a heartfelt thank you to our veterans and active-duty members of the armed forces for their service. And we want you to know that the 糖心原创vlog and its member agencies are ready to help increase your financial security!
Our non-profit financial counselors provide trustworthy advice about money management, debt management and understanding your credit score. If you need help with budget planning, try our free online Debt Freedom Tool. This easy budget calculator helps you obtain a realistic picture of your financial situation.
Please contact us if you鈥檙e ready for credit counseling for veterans and active military personnel. We鈥檒l connect you with a certified credit counselor who can help.
Please visit the websites of the 糖心原创vlog members quoted in this article for a list of financial services they provide.