Military Saves Week, a component of America Saves, has partnered with Department of Defense for eight years to encourage healthy finances for military families. With the United States military in limbo right now, between budget cuts and force reduction, preparing for one’s future might not be at the forefront of many minds. Preparing for one’s future, should be important, being prepared is what you can depend on when other things fall apart.
Over half of today’s active duty force doesn’t contribute to their Thrift Savings Plan. In statistics put out by the Federal Retirement Thrift Investment Board the number of service members that contribute is at 40.5%. While the number is up about 1%, the concern is for the numbers that aren’t contributing and why. There is something to be said about having that nest egg. Something, Barbara Thompson, Director of Office of Family Policy, sees as important.
“Their involvement in the TSP is critical,” says Thompson, whether they are deciding to make a career of the military are not. “If you don’t do that, what are you going to have after your years of service if you haven’t joined the TSP?”
In the beginning of my husband’s military career we weren’t sure what the future held, whether this would become a career or not. It didn’t matter; we started contributing to the TSP, because we realized how important it was to prepare for our future. Even if we had completed our years of service in just six years, we would have had a start. Starting small, accruing interesting – this can be an incredible start to a positive lifestyle of saving.
“We need to be thinking about our financial future,” Thompson said, “even if we’re only twenty, sixty-five will come soon enough, and we want to make sure we are going to be comfortable in those retirement years.”
How do we change our viewpoint about savings? We have to look at it like we are paying ourselves. Your goals can be small at first. Maybe you want to start contributing to TSP. Seeing that money start to grow and you will quickly realize how good that feels. Taking another step towards an overall goal, next, save one month’s salary in a savings account for emergencies, or for a down-payment on a home. Military Save’s website has amazing tools.
One of the best ways to get a jump start on your savings is to pay down high interest debt. Military Saves recommends the National Foundation for Credit Counseling. They also recommend saving automatically with MyPay. By leaving your check before you even know it’s there, you probably won’t miss it.
The last tip recommended by Military Saves is checking out the Savings Deposit Program. Never heard of it? A total of $10,000 may be deposited during each deployment and will earn you 10% annually. The account cannot be closed until you have left a combat zone, and will continue to draw interest for 90 days once you’ve returned home. This is incredible program, and perfect for those wanting to get a jump start on saving by taking advantage of the extra pay earned during deployments.
Inevitably there will be those that think they can’t save, or because they can’t save now how can they possibly start? Even a small step in the right direction is a step. Military saves has a whole section just for saving on a tight budget.
Saving is hard, but the reward is great. Getting your whole family involved in your financial health can make the whole experience positive and rewarding. Show your children the value of saving and rewards that comes from it. In our home we have a chore chart for two oldest children. They have a number of standard chores that they must do, and one special chore that they do every day that earns them a weekly allowance. When we set this up for them we sat down and talked about the money they would be earning. As long as they kept up with their regular chores, and showed us they could be responsible they would continue to earn their allowance. They picked out something from the store they wanted to save for, after setting aside a small amount to tithe to church. Getting them actively involved excited them, and also told me we were doing the right thing to help ensure their financial future. With all of life’s uncertainties, your finances shouldn’t be one of them.
**you can also obtain free financial counseling by visiting the Financial Counseling page of Military One Source. Also, check with your financial institution to see what they provide. Maybe offer free services as well.