Here’s What Servicemembers Should Do For Financial Success

June 23rd, 2021 by

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As a member of the armed forces, you serve every day in a challenging environment to ensure the freedoms and liberties in America. 

The Bureau of Consumer Financial Protection and the Security and Exchange Commission (SEC) are teaming up to set out specific actions that servicemembers can take to navigate their personal finances. 

These actions will assist in securing financial freedom and ensure that servicemembers and their family will prosper now and in the future.

Related: What to know about the Servicemembers Civil Relief Act (SCRA)

Actions that you can take immediately to ensure your financial freedom include: paying off high-interest debt, setting goals, and making a financial plan; and lastly, start saving and investing early. 

Payoff High-Interest Debt

When it comes to maintaining your debt, good credit and improving your credit scores go hand in hand. If you are applying for a mortgage or renting an apartment, your credit scores can play an important role in your financial plan. 

Remember that trouble with your personal finances can put your duty status, potential promotions, and your service career in danger. 

Related: What rights do Servicemembers have when dealing with debt collectors?

According to the Bureau of Consumer Financial Protection and the Security and Exchange Commission, it’s best to take a look at your debts and start to pay off your highest interest rate first. Once that is paid off, begin to pay off the next highest and so on. 

By doing so you will find that those important credit scores will become stronger and you begin to see how you will have extra money to invest with.

Set Financial Goals and Make a Plan

One of the best ways to achieve financial security is to determine what you want to save for. Could it be for a vacation, a new home, a college education, or even an emergency fund; decide what’s most important and plan accordingly. 

There are many savings goal calculators you can find online that will assist you in showing you how much you will need to save each month to meet your goal. Generally, they will ask for such information as your desired final savings goal, how much money you have already available to invest, and how long you plan to save for. 

The calculator will then show you how much you will need to save per month to reach your goal.

Start saving and investing early

Compound interest is one of the fastest ways you can grow your money and see those results, especially if you start early and are planning to save for a long while. 

With compound interest, you earn interest off of your initial amount that you invested and the interest that you earned. It can provide tremendous long-term benefits.

To assist you with your financial planning, especially as it pertains to being a servicemember, the SEC’s website Investor.gov and the Bureau’s website Consumerfinance.gov have tools and resources that can be beneficial for you. 

Also, you may want to explore another Bureau’s webpage Navigating the Military Financial Lifecycle for additional information and resources.

 


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