A Guide to Budgeting for Military Life Changes

Budget for Military Life Changes

Life in the military is an adventure that brings with it unique challenges and rewards. From Permanent Change of Station (PCS) moves to deployments, and from welcoming a new family member to transitioning into retirement, the financial landscape for military families is ever-changing. You need a budget that will adapt to these changes.

Successfully navigating these military life transitions requires strategic budgeting and financial planning. Let’s delve into specific military life changes, with insights on how to prepare your budget for the journey ahead. 

Budgeting for PCS Moves 

Permanent Change of Station (PCS) moves are a constant reality for most military families. On average, families move every 2.5 years. Although the military covers major moving expenses, these transitions can still impact your budget due to the cost of shipping vehicles or pets, temporary lodging, and the need for new household items. Often, military spouses lose pay while they seek new jobs after a PCS move. To prepare financially: 

  1. Create a PCS fund: Set aside a portion of your budget specifically for upcoming PCS moves. This fund can help cover unexpected expenses and ease the financial strain of It will also allow you to pay out of pocket while waiting for military reimbursement paperwork, which is especially challenging during Do-it-Yourself (DITY) moves. 
  2. Research moving benefits: Familiarize yourself with military allowances and benefits related to PCS moves. Take advantage of available resources to help offset some of the costs, such as Dislocation Allowance (DLA) and Temporary Lodging Expense (TLE). 
  3. Minimize unnecessary expenses: Consider selling or donating items you don’t need before a move. Reducing the weight of your household goods can save money on shipping costs.

Deployments: Managing Finances from Afar 

Deployments bring unique financial challenges. Sometimes, service members may receive additional pay or allowances. Other times, they will pay extra for internet access, phone bills, or meals. To prepare for deployments: 

  1. Build an emergency fund: Establish or bolster your emergency fund. Having a financial safety net can alleviate stress during deployments, especially if unexpected expenses arise. (And let’s be honest, something unexpected usually breaks as soon as the service member walks out the door!) 
  2. Get a Power of Attorney: Designate a trusted family member or friend with power of attorney (PoA) to manage financial affairs in your absence. This ensures bills are paid on time and allows them to handle paperwork related to taxes, vehicle registration, and insurance changes. You can do this for free through the legal office on base. 
  3. Communicate: Maintain open communication about financial goals and priorities. Are you saving for a post-deployment gift or vacation? Will you pay down bills like a car or student loan? Set a budget together before the deployment to ensure both partners are aligned on spending and saving plans.

Having a Baby: Budgeting for a Growing Family 

Welcoming a new family member is a joyous occasion but comes with added financial responsibilities. To financially prepare for a new addition to the family: 

  1. Review insurance coverage: Tricare health insurance covers maternity and newborn care for the spouse, and the baby will need to be enrolled in DEERS immediately for their coverage. Understand your responsibilities with paperwork, co-pays, and deductibles. 
  2. Adjust monthly budget: Anticipate increased expenses related to baby supplies, healthcare, and potentially reduced income if one parent takes time off work. Adjust your monthly budget accordingly. 
  3. Explore military benefits: Investigate available military benefits for new parents, such as the Servicemembers’ Group Life Insurance (SGLI) family coverage and the Family Subsistence Supplemental Allowance (FSSA). Your family may also qualify for WIC, which offers food vouchers for healthy groceries for mom and baby.

How to Budget for Spouse Unemployment 

Military spouse unemployment is common, due to frequent PCS moves, overseas duty stations, and remote locations with limited job opportunities. It can impact the family budget, requiring strategic planning and adjustments. To prepare for potential unemployment: 

  1. Create a single-income budget: Create a budget that considers the possibility of a single income. With one spouse home, you may reduce spending on childcare or gas. Identify areas where you can trim spending—at least temporarily—without sacrificing essential needs. 
  2. Build an emergency fund: Maintain a robust emergency fund to cover living expenses in case of sudden unemployment. Aim for at least three to six months’ worth of living expenses. 
  3. Practice networking and skill development: Encourage and support your spouse in building a professional network and developing skills that enhance their This can reduce the impact of employment gaps.

Living Overseas: Navigating International Budgets

Living overseas as a military family introduces unique financial considerations, including currency exchange, cost of living adjustments, and spouse employment challenges. To prepare for an international assignment: 

  1. Research local finances: Understand the local cost of living and currency exchange rates. As a military family, you’ll be shielded from most income taxes overseas, but you will still pay sales tax. You will receive an Overseas Cost of Living Allowance (COLA), but this doesn’t always match local prices, so continue researching throughout your time overseas. 
  2. Enroll in international banking: Explore banking options that cater to international living. Military banks usually offer on-base ATMs or a repayment of monthly ATM fees. Consider accounts that minimize currency conversion fees and offer convenient online access. 
  3. Plan for repatriation: Moving back home will be just as costly as moving overseas, and you won’t have the support of an on-base lending locker to provide dishes, temporary furniture, and other necessities while your household goods ship. You may need to rent a vehicle while waiting for yours to arrive. Anticipate the financial aspects of returning to your home country, and plan in advance.

Budget for Military Retirement 

Transitioning from military service to retirement is a significant life change with profound financial implications for the whole family. To ensure a smooth transition: 

  1.  Attend transition workshops: Take advantage of military transition workshops (TAP classes) that offer guidance on financial planning, retirement benefits, and civilian employment opportunities. 
  2. Maximize retirement accounts: Contribute to retirement accounts, such as the Thrift Savings Plan (TSP), and explore additional retirement savings options like a ROTH or traditional IRA. Try to maximize your contributions throughout your military service, but especially in the final years. 
  3. Make healthcare plans: Understand the healthcare options available after retirement for you and family members. Consider enrolling in the Tricare retiree health program and explore supplementary insurance plans to cover potential gaps.

By proactively preparing your budget for the various changes that may arise throughout military life, you can navigate these financial challenges with confidence. From PCS moves to retirement, strategic planning, communication, and a commitment to financial preparedness are key to ensuring the stability and well-being of your military family. 

Want your money to work for you throughout military life? Join The Edge, where service members, Veterans and spouses enjoy free, interactive tools and courses to help them through a huge variety of financial topics. Whether you are buying your first car or home, saving for school, comparing insurance options, or planning for retirement, you’ll find hundreds of useful tools on The Edge. Membership is free for military and spouses, thanks to scholarships from our sponsors! Sign up for The Edge here. 

If you prefer more hands-on help exploring budgeting tools, then you’ll love our free, virtual Budget Boot Camp. It’s a week of interactive budget tips, specific to military families. Enroll in Budget Boot Camp for free so you don’t miss this great financial resource. 

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At GoVA, we’re proud to partner with a lender that delivers peace of mind to those who have served and continue to serve our county. Together, GoVA and TowneBank Mortgage are committed to helping our military service members achieve their dreams of homeownership, as well as providing them with valuable resources along the way. As experienced lenders, TowneBank Mortgage understands the need for a quick and easy mortgage process, especially during life’s transitional moments. Headquartered in Norfolk, just miles from the world’s largest naval base, TowneBank Mortgage has had the honor of helping thousands of military families through their VA loan offerings. Their team is knowledgeable about VA products and the local market, and in-house operations allow them to respond to questions and concerns in a timely manner. Together, we can get you to closing in 30 days or less. Trust TowneBank Mortgage and GoVA loans to get you home.

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