Tax Guide

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Financial Challenges for Military Families

The military way of life has challenges unlike most other chosen professions. Some of those challenges involve just how to best run the family finances. Here’s a snapshot of some of the most common problems, and some tips for dealing with them.

Moving – Again

Few careers can match the military for the mobile lifestyle it forces on service members and their families. The unpredictability of the moves leads to emotional and financial stress. A new post may mean a higher cost of living, which can be rough on the budget. Housing, for example, can be a big problem: do you buy or rent? Some financial experts recommend that military members rent unless they know they’re going to be in the area for five years. Otherwise, they may be saddled with trying to sell a house long-distance when they’re unexpectedly reassigned.

In this same vein, the spouse of a soldier may find themselves trying to change jobs with each move, making career growth and continuity a real challenge. Perhaps the best strategy is to look at the Department of Defense employment system, or some line of work that’s not location-dependent. For those families posted overseas, look for opportunities tailored to your skills. How about teaching English? Or can you work for an American company with operations in your overseas area?

Long-Distance Money Management

Sure, the Internet has made it a lot easier to manage one’s finances while stationed anywhere, but there are still issues to face. One is security. Some banks, for example, block Internet traffic from some foreign countries. Experts recommend military-friendly firms that can smooth out those long-distance wrinkles.

Some payments – such as recurring bill payments and contributions to retirement accounts – can be set up in advance, before deployment. Such automatic payments ensure your obligations are handled – no matter where in the world you are – and it can also help keep your impulse spending under control.

Education, the Key to Civilian Transition

When it comes time to return to civilian life, education can be the bridge between your military service and your next career. The military assistance program can pay for your degree with little money from you. And it’s that degree – added to your military experience – that will make you a very marketable commodity in the civilian job market.

Also see:
Taxes for U.S. Service Members
Combat Pay and the Earned Income Credit