Ten Strategies For A Financially Responsible Military Life

Strategy 1: Don’t become emotionally separated from your money

Remember how you felt about money as a child? Simply holding a dollar bill was enjoyable. You knew exactly how much money you had and how you were going to use it. Now your paycheck is direct-deposited and you charge most every expense. That emotional separation from your money makes it easier to spend more. Watch your expenses decrease by using cash. Handing over three hard-earned twenties is much more difficult than a quick swipe authorizing a $58.47 charge to your credit card.

Strategy 2: Understand and be honest about expense classifications

Every dollar you spend is either for a “want” or a “need.” People often treat too many of their expenses as needs. Of the spending decisions you make everyday, are most for legitimate needs or do you just view them that way? Remember: eating is a need; eating out is a want.

Strategy 3: The time to lower your spending on needs was yesterday

Even if you limit your “wants” spending, you might struggle to save because your “needs” spending is too high for your income level. Review your spending priorities before committing to an apartment lease, mortgage, or car. Just because someone will sell you something does not mean you can afford it. Once you commit to a monthly payment, that expense takes part of your income for a long time.

Strategy 4: Enjoy free stuff

Go on a hike, sit in a park, talk with a friend, read a book, or lay on a beach. Many people think they can’t have a good time without spending money. But that’s a myth. When you were a kid, you usually had no money, yet were as busy and as happy as ever.

Strategy 5: Major on the major

Don’t spend a lot of time evaluating minor expenses, like where to buy pizza. Put a major focus on major purchases. Anything that requires financing is a major purchase. When making major spending decisions, like buying a car and choosing a place to live, ask yourself the tough questions. Can you actually afford it? Do you value every feature? What will the purchase do to your ability to save?

Strategy 6: Enjoy being with people you like

Your friends and family make an evening, not a menu. When you’re overseas and separated from your loved ones, you long to be together again. The location for where you spend your time (whether a fancy bistro, a family restaurant, or the kitchen table) is unimportant in the dream. It is still insignificant upon your return.

Strategy 7: Don’t blow off the recurring minor

Small expenses that repeat aren’t truly minor. Your cable bill, cell-phone bill, and gym membership are recurring minor expenses. Ensure you enjoy them as much as their cost. Can you find one recurring expense to cut? Perhaps by discontinuing a premium cable channel you never watch? Or by eliminating the all-inclusive cell phone plan? Minor expenses aren’t really minor if they last for a long time.

Strategy 8: Spend with comfort on items or experiences you value highly

Like the rest of your military lifestyle, you can’t rank every decision as most important. Life requires choices. If you don’t prioritize your spending decisions, you give up control. Know what you truly value and spend on those items without guilt. To succeed, you only need the discipline to stop spending on what you really don’t care about anyway.

Strategy 9: You won’t spend what you don’t see

Create a forced savings program. Enrolling in the Thrift Savings Plan (TSP) is the best way to do so. Even if you’re in the habit of spending what you make (but not more), you’ll quickly get used to spending less. While your net pay will be somewhat lower, you won’t have the temptation to spend what isn’t in your checking account. The earlier in your career you participate in your TSP, the easier it is to do so. When you’re just starting out, any pay is bigger pay than you’re used to.

Strategy 10: Constant budgeting isn’t required

It makes sense to prepare a budget at certain key times, like when making major purchases. However, if you prioritize your values and begin a forced savings program, you’ll meet any strict budget objectives you would otherwise put together. If you’re saving 15% of your gross pay, who cares how you’re spending the other 85%? Budget your savings, not your spending. Then, enjoy the spontaneity that life allows.

You can have your latte and drink it too.

A visit to the coffee shop is no different than a visit to any other retailer. You choose to spend money you could spend elsewhere or otherwise save. Yet too many people focus obsessively on minor expenses and miss the big picture. If a latte costs $3.50 and you don’t really like coffee, you’re definitely wasting money. But if you’re endlessly focusing on minor expenses and not seeing the big picture, you’re wasting both time and energy.

By Michael Rubin