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Stock Photo by Sean Lockewww.digitalplanetdesign.com

Soldiers get deployed at random all the time and with families and household bills, it is important to be financially prepared at all times. Although the Soldiers’ and Sailors’ Civil Relief Act (SCRA) requires creditors to lower to 6 percent the interest rate on any debt acquired before entrance into the service – during a deployment, soldiers are still responsible for bills and expenses. 

USAA put together this 5-step guide to help soldiers avoid debt and achieve financial success pre-deployment. 

  • Map out a deployment budget. Combine increased income in the form of extra allowances (such as hazardous duty, family separation or hardship pay) with lower expenses and you should have a recipe for financial goodness. To make the most of the situation, you’ll want to develop a budget that details your income and expenses and all the good stuff you want to accomplish — such as paying down debt, building up your emergency fund and saving for the future.
  • Prepare to save and invest. A deployment could come with unique opportunities to save and invest. The Defense Department’s special savings account called the Savings Deposit Program allows you to sock away up to $10,000 and earn a whopping 10% annual return. Additionally, you have a unique savings opportunity if you use tax exempt combat pay to make contributions to the Roth Thrift Savings Plan. You wouldn’t pay tax on those contributions at the time you make them — nor would you decades later when you withdraw your money and all it’s earned. Make no mistake, saving and investing should be a part of your game plan.
  • Set up your chain of command. You have a military chain of command, and you’ll also want to set up one for your finances. That probably means selecting someone you trust to act as your agent by drafting a power of attorney and providing them everything they need to do their job. That likely includes access to bills, account numbers, passwords and the like. It definitely means setting up online bill pay and leaving detailed instructions on everything from car care to pet care.
  • Do an insurance checkup. You and your unit will complete a long list of pre-deployment tasks. Put a thorough insurance review on your personal to-do list. Does Servicemembers Group Life Insurance protect your family enough? Do you have renters insurance to help protect your stuff around the globe? Are there adjustments you can make to your car insurance to save money while you’re gone? All of these are worth checking out.
  • Take advantage of the Servicemembers Civil Relief Act. The SCRA provides a number of key provisions that could help you as you prepare to deploy. This includes an interest rate cap on pre-service debt plus the ability to terminate leases and delay certain court proceedings. Talk to your judge advocate general if you have questions.