Serving in the military is a great responsibility, one that is truly remarkable. On behalf of everyone here, we thank you for your service. As a military veteran, there can be a lot of first-time financial things you’ll experience that you aren’t used to. You’ll no longer be qualified for BAH, so learning to budget for those expenses is one of the biggest shocks to many military veterans. Additionally, paying for health insurance and all of those fees can really add up as well. To help ease the burden of figuring out what to do now that you are a civilian, here are some ways to help you manage your finances when you are fresh out of the military.
Get Your VA Benefits
The Department of Veterans Affairs offers a range of benefits to veterans, including health care and financial assistance. Whether you served during peacetime or during a period of war, including the Vietnam War, you can receive benefits from the VA. Veterans who served during peacetime may also be eligible, depending on their age when they left the service. Some of these benefits are also dependent upon whether your separation from the military was due to a disability, retirement, or other reason. VA disability compensation varies, so it’s important to connect with the local VA to find out what you are eligible for.
Start a Budget
Establishing a budget is the most important step you can take to get your finances in order. A budget will help you determine how much money you’ll have available to spend on things, and it will allow you to plan ahead so that all of your expenses are covered throughout the month. As a civilian now, you’ll need to incorporate the cost of mortgage or rent payments, utilities, and potentially some medical expenses. You’ll also need to cover the costs of food, car payments, insurance, and any fun things you want to do with your time. Create your budget based on the necessities first, and incorporate the fun things later.
Know Your Retirement Plans
Some military retirees make enough to live on without needing additional work. Your rank when you separated from the armed forces is one factor that goes into your retirement amount. It’s important to find this number out before you leave the service to ensure you know what’s possible. This will help you determine if you need full-time or part-time work to help you pay the bills. This pension can provide stability while you are job hunting or between jobs. Additionally, it’s important to set aside some of these funds for savings and emergencies.
Determine Your Next Career Path
Sometimes it’s hard to figure out how to use your military skills for civilian jobs. While some former military people find great work in law enforcement or firefighting, others end up in normal office jobs doing administrative or IT work. You’ve spent years honing a set of skills and learning how to work effectively in a team as part of the military, but what does that mean for your future? Where do you go from here?
Career experts often advise veterans to take time out of their lives for self-reflection, and this is no different. Think about the things that made you successful in the past, and consider whether those same skills could be leveraged in another career path. Could you use your airplane mechanic skills or your attention to detail in another way?
Understand Credit Scores and How to Build Yours
For many people, their credit score is the most important number in their lives. Credit scores are used to determine interest rates on loans and other financial products, so having a high score can save you money. If you’re new to managing your own finances after being in the military, it’s worth understanding how to improve your credit score by building a history of keeping bills paid on time and avoiding late payments.
Credit scores are calculated based on five factors. These are payment history, the amount owed, length of credit history, new accounts opened recently, and types of accounts. You can improve your score by carrying a low load of debt in relation to your monthly income.