Make 2016 the Year You’re Ready for Military Life’s ‘Gotcha’ Moments
By Alecia D. Blair, Military Saves Communications
If you’re among the 44 percent of Americans who, according to the Consumer Federation of America (CFA) and Credit Union National Association (CUNA)’s annual holiday spending survey, do not have extra funds to pay an unexpected $1,000 expense, this New Year should have a sobering effect on you. Why? Just imagine…
- You purchased a few unplanned gifts during the holidays…on your credit card, and now the bill is in.
- Your car transmission just went on the way to PT.
- The hot water heater died in your house and is leaking all over your basement floor.
- An unexpected deployment, TDY or PCS move has you needing extra cash for advances and extras!
- A family emergency calls for a last-minute (and expensive) flight home.
These are all excellent reasons to have a $1,000 or so stashed away above and beyond other short-term (rainy day) and long-term savings. Think about it. How would you pay for any of these eventualities, which so often come with military life? The answer should not be a credit card, which could cost you more money (due to interest) if you can’t pay it off immediately. Here are some tips to start the New Year right, find solid financial footing and help you save that $1,000.
1. Get real about your holiday spending and credit card bills. Now.
If you found yourself using your credit card(s) to fund your holiday shopping sprees and feasts, now is the time to face reality. Create a list of all your debts and know who and how much you owe. Put away the plastic with these tips from the FINRA Investor Education Foundation and work to pay off high-interest credit cards first so that you can use that money for other purposes, such as kick-starting a healthy emergency fund, which leads us to the next tip!
2. Keep yourself from seeing red with an emergency fund.
There are so many things to love about having an emergency fund as noted by Rebecca White, especially when in the military. An emergency fund can help alleviate financial stress by offering a safety net for surprises that arise, allowing you to keep those expensive credit cards in your pocket (where they usually belong).
3. Take that tax return and put it to work for you!
The “average American tax refund is nearly $3,000”—that’s a lot of money you could use to, simply, get ahead! Use your tax return to prepare for military life’s surprises by starting or bolstering your emergency fund, adding to your retirement and evaluating your insurance needs. You can’t go wrong with any of these options!
4. Make saving automatic.
Saving automatically—through an allotment or automatic transfer of funds—to a short-term or long-term savings account is the best way to save. Why? Because you don’t have to think about it. Set it and forget it because it’s automatic! So, whether it comes to saving for your emergency fund, paying off a debt or investing in your retirement, set your savings on autopilot today!
Make 2016 the year you’re financially prepared to face life’s "gotcha" moments, especially in the military. Set a goal. Make a plan. Save automatically.
- Written by Alecia Blair
- Category: Blog
- Published: 05 January 2016