Responsible Credit Resources for Veterans
Service members and Veterans are no more immune to debt than anyone else. In fact, Veterans as a group carry higher than average debt compared to the rest of the population.
Veterans and debt
Several factors contribute to Veterans’ financial difficulties. Military members are often young and financially inexperienced. Upon joining, many servicemen and women suddenly earn more money than they ever have before. Some receive five-figure signing bonuses but have no solid plan for managing the windfall.
Even the most financially savvy military families relocate frequently and must learn to survive on just one income. In the time it takes for the spouse to find meaningful work and arrange for trusted childcare, the tour is complete (or nearly) and the family is on their way to yet another new city.
Further complicating the veteran’s financial situation is the reality of a tough job market. Veterans often struggle to find employment in the private sector upon completion of their military service. Many members of the armed forces train and work in a very narrow field, with no guarantee of finding a similar job upon discharge.
Managing finances is no easy task. It requires discipline and sacrifice on a daily basis. Planning for emergencies and saving for a rainy day are challenges for us all. And once debt begins to rise, it cannot fall without a specific and directed plan of attack. For some financial planning tips, see Managing Money During Deployment.
Help for service members and Veterans
Active duty personnel get some relief from the 2003 Servicemembers Civil Relief Act (SCRA). This law eases the financial burdens on service members and their families brought on by the various demands of active duty. Credit card, mortgage and other debt is capped at 6% interest; credit and insurance accounts and their respective terms cannot be changed or denied because a service member invokes SCRA protection; mandatory court appearances may be postponed; evictions are limited; property and auto leases may be terminated under certain conditions; property foreclosure and vehicle repossession are limited; health and life insurance are protected against lapse and termination; obligation to pay state taxes is limited to the service member’s state of legal residency.
Resources for Veterans
Many resources are available for Veterans who are struggling financially. If you’re a service member or veteran in need of counseling or other financial management assistance, check out these links.
The Department of Veterans Affairs offers an abundance of information with regard to paying and managing VA debt of all varieties.
Sharpen Today's Hands on Banking Program is a partnership between the National Foundation for Credit Counseling and Wells Fargo designed to keep military personnel and their families on a path to financial stability.
Army Emergency Relief is a non-profit organization that helps soldiers and their dependents. They offer all types of assistance, from emergency financial help to counseling and financial management education.
Leave No Veteran Behind is a non-profit organization that helps financially struggling Veterans with education and employment. They offer a wide range of services including debt relief, employment training and job placement. In the program, service members perform community service in exchange for financial assistance. Money is donated by the community at large.
The Defense Finance and Accounting Service processes military pay, issues travel pay, manages retirement and health benefits and handles numerous other administrative duties with regard to DoD pay. Their website includes information about requesting deferments, waivers, and other information related to financial hardship.
Military Saves, the military offshoot of America Saves, is a marketing campaign to persuade and encourage military families to save regularly, and to persuade organizations to aggressively promote automatic savings. The organization provides education and support for managing finances, staying out of debt and building savings.