By Justine Laurie Contributor, The Milspo Project
When you become a military spouse, life as you know it changes in almost every way, and to say the financial adjustment can be overwhelming is a huge understatement. If you are anything like me, when you married your servicemember, it was the first time you were truly “on your own” financially. Prior to marrying my husband, I had a high paying job and lived rent-fee with my parents, so essentially 100 percent of my income was disposable. We got married, and then two weeks later we were moving to North Carolina, I had no job, and we had to budget rent, utilities, groceries, and all other living expenses on E3 pay. Even with my background in finance, making and sticking to a budget was HARD, and more months than not, we blew our budget and racked up credit card bills to cover it. Things got easier as my husband progressed through his career and I found a solid career for myself as a CPA, but seven years later we still struggle to consistently stick to our budget. Luckily, I have learned a lot along the way, and I do have some tips to share:
- Check out Dave Ramsey’s Financial Peace for some budgeting guidance. His philosophies such as giving every dollar a purpose and using envelopes of cash for your budget trouble areas are spot on. You can also download some of his super helpful budgeting worksheets from his website.
- Sit down with your spouse and make a reasonable budget. It is key that you sit down together and make a budget that you both agree with – if you aren’t on the same page with your budget, it can be the basis for some major arguments.
- Once your budget is set, use an online tool like Mint.com to track your progress. You can enter your budget, link your bank and credit card accounts, and track your budget in real-time. It gives you warnings if you are starting to spend out of control, and you can adjust your budget throughout the month if need be.
- Don’t use credit cards as a crutch. They can be great when you have your budget under control and can pay them off in full monthly, as the rewards can be awesome. But don’t use credit cards to spend beyond your budget. Credit card debt is a slippery slope that is easy to get into and hard to get out of.
- Save. If you are in debt, get that paid off as quickly as possible, and once you are out of debt, start saving. It’s important to have an emergency savings account for life’s little surprises, and the recommended minimum is three months of living expenses. Also, you are never too young to start saving for retirement which you can do via your spouse’s Thrift Savings Plan. And if you have children, it’s never too early to start a college savings account like a 529 plan.
- Regardless of your personal income, budget just on your servicemember’s earnings. Their income is essentially guaranteed, whereas if you are self-employed or subject to frequent moves, yours may not be dependable. Slate your earnings for saving and extras.
Budgeting is a tedious, ongoing process, and sticking to it is easier said than done. If you struggle at first, just keep at it and it will come together. In the end, it will give you financial freedom and even better, peace of mind!