Financial Strategies for Overseas Deployment


Credit and debt issues for military families is not uncommon. There are various pay entitlements for members of the Armed Forces, which can make financial matters a little confusing.

It’s important for military members to understand the different categories and amounts of pay and entitlements, so they can make the best decisions about their household financial planning. Just as you train and prepare for combat, you need to have tactics when it comes to executing your finances.

Here are some actions you may want to take before deploying to keep your finances in check:

Before Deployment

There’s a lot to do before you set off for deployment. Don’t forget to designate someone you trust (spouse, parent, sibling) to oversee your finances before you deploy. It’s also important to not accrue any major debt before you deploy. Make sure you have a plan! Discuss your current financial matters with your spouse or whoever you are choosing to involve in your finances. If you don’t have direct deposit already, be sure to set it up. If you don’t want to burden someone with making your payments, automate your finances. This will work to your advantage in building your credit by avoiding late fees and missed payments. Leading up to your deployment, you will want to create an emergency fund. An emergency fund can be great source of cash for life’s curveballs. With extra cash stored away for emergencies, you limit the need to rely on credit cards, which can lead to debt. Consider saving 3-6 months’ worth of expenses.

Managing Your Money During Overseas Deployment

Be sure to take advantage of Department of Defense savings plans:

Thrift Savings Plan: Retirement savings plan for military personnel and federal employees that work similar to a 401k plan. Like a 401k you can invest your money after taxes (Roth) or pre-taxed (Traditional). With many investment options and low management fees (around 38 cents for every $1000 invested) a TSP may be a good option for you and your family.

Saving Deposit Program: Unlike the TSP, the SDP is only available during combat employment. Personnel need to be serving in a combat zone or qualified area outside the US for more than 30 executive days or 1 day in each of three consecutive months. You can deposit up to $10,000 for each deployment and earn up to 10% annual interest during deployment (this is taxable). Additionally, you can earn 10% interest up to 90 days after returning home. There’s no fee for stopping your deposits.

Post Deployment

When you return home from deployment, it’s important to communicate with your trustee who’s been handling your financial affairs. Get up to date on what debts have/have not been paid off. Financial protections such as SCRA and SDP will soon expire, so communicating and understanding what needs to be done next is crucial. Just as a financial plan was developed before deployment, a post deployment plan is equally vital. Coming back home can be overwhelming, but be sure to not overspend! You may be tempted to spend the money you earned during your deployment. Consider spending money wisely and make smart financial decisions such as adding money to your Thrift Savings Plan and paying off any debt incurred. Be sure to develop a budget, and track your expenses.

If you feel as if you need further assistance regarding your finances, don’t hesitate to ask for assistance. Tayne Law Group would love to help any active/non-active military members overcome the burden of their debt. You’ve done your country a great justice, don’t let debt hold you down. Call 631-470-8204 for a free phone consultation to discuss your finances.

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