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Are You Savings Ready?

Crystal, a single E4, was working in her installation's Public Affairs office when a photographer with the Military Saves campaign asked if she'd be willing to pose for the campaign poster. She agreed. Later it occurred to her, "It's going to be bad if I'm on all these posters and I'm not saving."

She always intended to save, but never got around to it. Now, only 18 months later, she has no credit card debt, an emergency fund, and a savings account for a down payment on a house. She also contributes to Thrift Savings Plan (TSP) and has a Roth IRA.

What changed for Crystal? She didn't change jobs, didn't win the lottery or get an inheritance. Crystal simply set a goal and then took action.

Crystal is now a "savings ready" military member, with a healthy financial profile who doesn't have to worry about finances when she deploys in support of the Global War on Terrorism or any other military operation. Are you savings ready?

To get an idea of your readiness level, ask yourself these questions:

  • Are you free from credit card debt so you don't have to pay finance charges for carrying a balance?
  • Do you have emergency savings?

Most financial planners recommend you have three to six months of household expenses set aside in an interest-bearing savings account to handle unexpected expenses.

Do you plan for future expenses (car repair, vacations, household appliance or furniture purchases, holiday and birthday gifts, back-to-school clothing and supplies, etc.), saving money before you spend it?

Are you building wealth by owning your own home, or are you planning to buy a home by saving for a down payment and paying attention to establishing an excellent credit rating?

If you have children, or you or your spouse are planning to return to school for further education, do you have college funds?

If you answered "Yes" to most or all of these questions, you are savings ready! If not, don't despair - not only are you in the same boat as most Americans, you can change your situation.

The first step is to set a savings (or debt reduction) goal. People with written goals and plan to reach them are much more likely to succeed. If you have a written savings goal, you're likely to save twice as much money as someone who doesn't have a goal.

When you set your first goal, remember the SMART goal-setting guidelines. Make sure your goal is:

  • Specific, significant to you, and stretches you a little bit;
  • Measurable, so you can easily know if you're making progress, meaningful to you and your family, and motivates you to achieve it;
  • Achievable, agreed upon with your spouse if you're married, and action-oriented;
  • Results-oriented, realistic in light of your personal situation, and rewarding; and
  • Time-based, tangible, and trackable.

Let's walk a Military Mom through setting a goal to see how this works. Like Crystal, her financial situation is okay, but not great. She has a little credit card debt, already contributes to TSP, but doesn't have any other savings. She decides that her goal is to have $500 in a savings account so she doesn't have to go deeper into debt if she has an emergency, and then she'll pay off her credit card as quickly as possible.

Her goal is SMART, because it's specific and stretches her to do something new. It's measurable and trackable, since she'll be able to see her progress every pay period. It's meaningful, because it gives Military Mom and her family hope that they can be debt free and have savings.

It's achievable, because Military Mom found $100 per month that she could save by cutting premium cable channels, bringing her lunch to work, skipping fast food for the kids except a once a month treat, and getting movies from the library instead of renting them. She and her civilian husband agreed on the goal and the plan to achieve it, so they're working on it together .

Decide now to get savings ready in 2007. Set your goal, make your plan, and go, go, go.

In addition to directing the Military Saves campaign, Sarah Shirley is a chaplain in the Florida Air National Guard, and the spouse of an active duty military member. Set your goal on-line at

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