By Lacey Langford, AFC®
There’s a lot to know and do when it comes to money. The amount of financial knowledge circulating the world is humbling even for a financial professional. The good news is… you don’t have to know it all to be successful with money. The bad news is… you have to learn some basic concepts to keep your finances running smoothly. Here are 5 money concepts to practice when you’re in the military.
In your earning years, you’re saving money for 2 people, you + your 80-year-old self. So, if you’re not saving money now, you’re not covering food and living expenses for your future self. Not to mention, you’re not self-insuring for when unexpected expenses come up. Making savings a priority is an important money concept to know and practice!
The easiest way to keep your money running is to make everything automatic. Make your savings automatic by setting an automatic transfer from your checking to your savings every pay period. Set your bills up for automatic payments to ensure they’re paid on time each month. By doing so, you’ll reduce errors in payments and build a healthy habit of saving money each month.
We’ve all heard the horror stories of servicemembers getting robbed blind by someone they thought was close to them. You must maintain control of your money. Be like Oprah. Be the only person that can get money out of your bank. She maintained control of her bank accounts to ensure no one preyed on her money. Don’t give anyone access to your money. With the invention of auto pay, you have the ability to pay your bills even during deployments and TDYs, so there isn’t a need to give access to your money. And if you absolutely have to give someone access know 100 percent they’re a trusted person beforehand.
It’s important to avoid debt like the plague! Having debt means that each day when you go to work or deploy, you’re not doing it for you or your family. You’re pulling on that uniform to pay Visa or Mastercard, or your student loan company. If you have no debt, each hour you work is for you and your quality of life, not for someone else. Stay out of debt to give yourself more freedom in life to spend your money on the things you love and value.
Ignorance is not bliss when it comes to your financial life. Just because you understand something or it’s a best practice now doesn’t mean it will always be. Make your financial education a lifelong pursuit. Take time to read updates from your bank, Military Saves, or TSP.gov to learn about any changes or improvements in the personal finance industry. Remember, you don’t have to know everything, but you do have to know the basic money concepts to have financial success.
Lacey Langford is a personal finance writer, military money coach, and speaker who helps others with the how, what, when, where, and why of their money at LaceyLangford.com.
Want to know another tool to help you achieve financial success? Take the Military Saves Pledge today and visit militarysaves.org for tips and resources to motivate you on your journey to build wealth and reduce debt.