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Mobilizing! Financial Tips for Military Families


It happens to almost all of us in the reserve components, sooner or later: That call to active duty. Hopefully you’ll have more time than I had. I was on State Active Duty on less than 24 hours’ notice, working 18 hours a day to mobilize a Guard infantry battalion, then federalized five days later and it was off to the races!

I didn’t get to do much other than drop a years’ worth of advance rent checks to my landlord and take off. But if you have a bit more time to get organized for you and your family, here’s what you should be thinking about:

Family Conference

  • Brief up your spouse on all finances. If your spouse has had a hands-off attitude towards money so far, now’s the time to bring him or her up to speed. (For this article, I’ll play the percentages and assume it’s a female spouse, not in the military.)

  • All savings and checking account numbers, locations, balances, outstanding checks, and scheduled automated payments.

  • Location and policy numbers of all insurance policies

  • Location of all title and deed documents for your cars, home, etc.

  • Location of marriage licenses and dependent birth certificates and Social Security cards.

  • Location of your will, if you have one. However, your unit will give you a chance to update your last will and testament, health care power of attorney and other documents as part of the mobilization process.

  • Household budget. Work with your admin NCO to project what your income is going to be while on active duty. Include your base pay, BAH and language proficiency pay. But don’t include hazardous duty pay, sea pay, or other pays that are not guaranteed until you start bringing them in. You may get a different assignment than you expect, with lower special pays.

  • Power of attorney documents. Your spouse will need to be able to make certain financial decisions while you are away. She will have to make many difficult decisions if you are deceased or incapacitated. Make sure you have at least a limited power of attorney giving her access to the accounts she needs to run your home while you’re away.

  • Plan on a pay glitch. There’s always someone in every unit who has trouble getting paid for weeks into a mobilization. Assume it’s going to be you, and execute accordingly. Start saving up for an emergency fund, with at least three months’ worth of expenses, either in cash, money markets, or cash value in a permanent life insurance policy. Retirement funds don’t make good sources for emergency funds, because of the penalties involved in taking distributions.

  • Work on an emergency family care plan. Now that you’re mobilizing, what if something happens to your spouse? Who will be able to take care of your children until you can return? Generally, you should be able to take leave, or even come home due to hardship if your spouse dies or becomes permanently disabled and you need to come home to take care of children. However, it could well take time for you to make it home. Who is willing to help? Your spouse may trade this commitment with other military families – though preferably not from the same unit or ship.


Notify Your Employer

By law, you must notify your employer prior to missing work. There’s no specific length of time you need to give your employer prior to departing, but you should definitely give your employer as much time as practicable to prepare for your absence.


Financial Planning Issues

Enroll your family in TRICARE.

You may want to cancel your health insurance coverage, effective the day you enroll your family in TRICARE. Under HIPAA rules, you can generally get coverage again when you come off of active duty, provided there’s no break in coverage longer than 63 days. You should have no problem reenrolling in your workplace plan upon your release from active duty (provided you report back to work in a timely matter after leaving active duty). If you are self-employed, or you have your own private coverage instead of a workplace plan, though, you may need to check your state’s laws regarding reenrolling in your plan upon coming home. Speak with an experienced health insurance agent about your reentry privileges in your state.

Note: Under current law, as of March 31, 2012, the provisions of the Affordable Care Act guaranteeing you the right to buy health insurance on a federal exchange are currently scheduled to kick in in 2014. If you are returning after January 1, 2014, reentry into your private insurance pool is much less of a problem – unless the Supreme Court strikes down the “ObamaCare” law, or parts of it, or Congress intervenes. As of this writing, it’s too early to tell what will happen.

Consider moving to on-base housing. Each community is different. Normally, BAH is designed to cover about 80 percent of your family shelter costs. If you find a great deal off post, or you like where you are or own your home, you’ll probably want to stay there. Otherwise, see if post housing is available, and compare the costs. The military should pay for a PCS move.

Notify creditors. Under the terms of the Soldiers and Sailors Civil Relief Act, the interest rate on all your debt should be reduced to 6 percent for the duration of your mobilization.

Additionally, the SSCRA provides the following benefits to military members being called to active duty:

  • Reduced interest rates on mortgage payments.

  • Reduced interest rate on credit card debt.

  • Protection from eviction if your rent is $1,200 or less.

  • Delay of all civil court actions, such as bankruptcy, foreclosure or divorce proceedings.

Generally, the protection applies to all debts incurred prior to your mobilization, unless your creditors can prove in court that your mobilization does not materially affect your ability to pay your debts as originally scheduled.

You do generally need to notify creditors in writing, however, and provide them a copy of your orders or other documentation of your mobilization.

Taking these steps will go a long way in preventing legal and financial mishaps while you are mobilized. Even if you aren’t mobilizing any time soon, you could use this checklist now to get your paperwork in order. It’s just one less thing to worry about down the road.


Contributed by Jason Van Steenwyk

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