By Lepresca Torres, AFC® Candidate, FINRA Spouse Fellow
It’s that time again. Orders have been approved, the pack out is scheduled, and you are looking to the next duty station with anxiety and, hopefully, excitement.
Still, it’s not always easy to get excited when there are so many things that are up in the air. How will the cost of living affect our family? Will I need to work? If so, are there adequate jobs? Is affordable childcare available? What unexpected costs might we incur?
Let’s be real. There is a great deal of anxiety that goes along with each new duty station. Finances are only one slice of the overwhelming permanent change of station (PCS) pie! While the government takes care of the actual move, your family is left to piece together the fragments you call life and move it to the next place with minimal disturbance. Here are five tips to make the PCS upheaval a little less financially daunting.
1. Evaluate your current finances
Hopefully, your family has a budget that is readily accessible. If not, now is the time to pull all of your financial details together. Write down the recurring bills that will be constant no matter where you move. These may include credit card payments, student loans, child support, automobile loans, a mortgages, college savings plans or tuition, etc. If you’re staying within the Contintental United States (CONUS), you should include automobile insurance, taxes (where applicable), mobile phone/data plans, etc.
2. Understanding active duty pay adjustments
Here’s where the real fun of finances begins! How will the new duty assignment affect the active duty member’s pay? For example, a Navy sea-duty tour will allocate special incentives to the service member for being out to sea. If the duty member is taking a shore command, any sea duty incentive pay will be removed upon checking into the new command. Equally important to know is if there are any special or hazardous pay incentives that may be taken or added with the upcoming orders. Also, don’t forget to take note of BAH, BAS, and COLA (where applicable) allowance adjustments and understand how they apply to the tour of duty (i.e. deployable or at-sea).
3. Current cost of living vs. future cost of living
Estimating the cost of living at the new duty station will be much easier if the new duty station is CONUS. Outside Continental United States (OCONUS) tours are subject to local cost of living determinants, which are difficult to apply without first-hand expertise. In OCONUS situations, reach out to the OMBUDSMAN at the new duty station or get connected to local social media sites for resources on obtaining the most accurate data. There is general information regarding the cost of living by country available at Numbeo.
For those staying CONUS, Bankrate.com, offers an excellent resource for comparing city-to-city cost of living analyses. Take note in housing, utilities, groceries, and gasoline comparisons in particular. These areas will most directly impact your wallet.
4. Know your resources
There are tons of resources available to make PCSing less painful, financially speaking. Dislocation allowances (DLA), Mileage Rates, CONUS COLA, and Station Allowance Changes are just a few monetary programs established by the government to make money matters easier to manage during the PCS process and thereafter.
If an emergency situation develops during the PSC (e.g., car broke down, fund shortages), there are other military affiliated programs available to assist service members: Navy-Marine Corps Relief Society, Air Force Aid Society, Army Emergency Relief, and Coast Guard Mutual Assistance. These programs have been established to provide interest-free financial assistance to service members in emergency situations; all programs cover PSC costs. If there is hardship during the move, contact your local chapter or destination location, or follow the links provided above for further information on how you can obtain assistance to cover expenses.
5. Keep your receipts
When all else fails, keep all receipts pertaining to the move for consideration during the tax season. If government funding does not cover a portion of your move (e.g., pet travel expenses) there is a possibility that the costs are tax deductible. Ideally, keep all receipts that are questionable, along with proper records indicating the purpose of the cost for review during tax time. You could get a tax write-off!
The bottom line—be prepared. The process of changing duty stations can drum up a million emotions. Take a few extra steps to prepare your finances and feel more secure. In other words, “Hey, you can do this!”