As a member of the military, it's not a matter of if, but when, you'll be ordered to make a permanent change of station, or PCS.
Of the many things you'll need to do to prepare, getting your finances in order should be near the top of the list. You don't want to find yourself in a financial hole when you get to your new home.
Here are some suggestions for preparing your finances for the inevitable:
- Build a PCS fund. Start saving before you receive orders to move. This money will cover upfront costs such as travel expenditures and unreimbursed expenses such as utility deposits. As a rule of thumb, you should stash 5 percent of your gross income in an emergency fund and earmark $1,000 to $3,000 of that for your PCS fund. If you're not already doing so, start saving money today to ensure you'll be ready when those orders arrive.
- Know how you'll live on a single income. If you're married and your spouse is nonmilitary, it may take him or her several months to find a new job after the move. And there's no guarantee the job will pay as well as the previous one. So identify beforehand where you can cut expenses. Consider trading down to a less expensive car. Rent rather than buy, at least until things settle down and you know where you stand financially.
- Make a fresh financial start. Use the move to get your financial house in order. If you don't already have a budget, now's the time to start one. If you do, take time to review it and make necessary changes. Maybe it's time to start saving for your children's education or to pay down debt. The good news is you don't have to do this by yourself. Contact the financial counselors found at most military installations. They'll help you to develop a budget so you can better manage your money and meet your financial goals.