Four Financial Tips for a PCS Move
Military members facing a Permanent Change of Station (PCS) are authorized to receive payments under government entitlement programs, but you still need to plan your move carefully to ensure that costs don’t run away from you.
First, understand and use government entitlement programs. These programs compensate you for many of the expenses associated with the move and as most depend on your personal situation, you should do further research to understand and calculate the amount to which you’re entitled. Here are the most common:
- Basic Allowance for Housing (BAH): offsets some of the costs of housing if you don’t use government-provided housing. This can vary by geography.
- Dislocation Allowance (DLA): helps with miscellaneous costs and depends on your rank and dependent status.
- Military Allowance in lieu of Transportation (MALT): the “mileage” cost of driving between locations. Can be for one or two vehicles. Consult the Defense Table of Distances.
- Per Diem: Reimburses you for costs of meals and lodging during the move. Total amount depends on family size and the number of days (total distance divided by 350 miles per day).
- Temporary Lodging Expense (TLE): reimburses the costs of meals and housing when temporary housing is needed for up to 10 days for CONUS moves
Relocation reimbursements are meant to compensate you for the common anticipated expenses. However, many moves come with unanticipated “gotchas” above and beyond the anticipated expenses that will be reimbursed under the entitlements. Here are tips that can help you avoid the most common pitfalls.
- Get an advance on entitlements: With 10 day notification, you can get an advance of 100% of DLA, MALT, and per diem. If you don’t request an advance, you’ll have to float this on your own for several weeks before reimbursement.
- Estimate and plan carefully: How often have you heard the quote “Failing to plan is planning to fail” in the military? It applies in real life too, so plan you move beforehand so you don’t go over-budget without even knowing what your budget is.
- Driving costs: estimate your mileage allowance and your per diem based on the length of trip. Plan your route (including number of days, meals and accommodations) so you stay under per diem amount.
- Budget for miscellaneous costs in new place: Everyone ends up spending money on a new place. It may just be food staples and shower curtains, but often it’s more. Create a budget for these items.
- Save in advance: if you know you have a PCS move coming, build up a cushion. You may not need it but you’ll be glad regardless of whether you use it.
- Don’t use credit cards—you shouldn’t borrow at all, but if you have to, stay away from credit cards. Rather, use the Advance Basic Pay program to get an interest-free loan you can pay back over 12 weeks.
With a little advance planning, your PCS move can go smoothly, but remember that without good planning, you’re planning to fail and will likely bust your budget. Make your move a success by how much you have available for different types of expenses and tracking as you go.