DOD focuses on financial health of military families|
by Nick Simeone
American Forces Press Service
1/18/2013 - WASHINGTON (AFNS) -- Since it can directly affect force readiness, the financial health of service members and their families is a high priority for the Defense Department, and a senior DOD official emphasized that January is a great time for military families to take stock of their financial situation.
As part of a Department-wide effort to encourage military families to avoid debt by creating a workable spending plan, Barbara Thompson, director of the Pentagon's office of Family Policy/Children and Youth outlined steps families can take and the resources that are available to them for achieving financial stability.
"The first step in attaining financial security is making a commitment to changing personal spending and savings habits," Thompson recently told American Forces Press Service and the Pentagon Channel.
It's important, she said, that military families manage their income to meet financial obligations and achieve long term goals.
"When you map your money coming in against your money going out, you are one step closer to paying off debt, building savings and feeling confident about your financial status," Thompson said.
Eliminating debt is the key, but Thompson stressed not all debt is created equal. High-interest credit card debt, she said, should be paid off first.
"We know when we go through financial planning that it is important to look at our credit cards ... and if we don't pay off those credit cards every month (it's important to find out) how much interest is being charged," Thompson said.
"If you overdid holiday spending," she added, "take some time to make a plan for paying off your debt and planning for next year's gifts."
Establishing an emergency fund is necessary to achieving financial stability, said Thompson, who recommended military families put a minimum of $500 aside for unexpected expenses.
There are a range of tools and services available to military personnel and their families to help them create a spending plan and remain financially stable, Thompson said. The service branches provide financial counselors at military bases, she said, and personal financial management assistance programs to help military families successfully plan for the future.
Thompson recommends military families visit the website, militaryonesource.mil, to access money management tips and tools.
"There are all these different financial calculators and tips and tools to help you understand how you can meet your savings goals," she said.
Financial readiness is a priority for the Pentagon, Thompson said, because it can have a direct effect on mission and force readiness.
"When service members feel confident that their financial affairs are secure, they can focus on their mission without worrying about things at home," she said.
DOD officials also note that financial security is a force readiness issue in another key respect: falling into debt can jeopardize the ability of service members to maintain the security clearances they need to do their jobs.