Paycheck Chronicles

Set Yourself Up For Success

Sometimes it’s difficult to set ourselves up for success — even when we know what’s in our long-term best interest.

Take, for example, that chicken-fried steak I recently ordered at my favorite restaurant in Gruene, Texas. I knew full well it wasn’t on the diet I’d just started, but it seemed too good to pass up. Looking back, the decision to drive to Gruene, and that particular restaurant, didn’t qualify under the heading of “setting myself up for success.”

As a financial planner, I’ve long encouraged those in the military to use a portion of each pay increase for financial good. Commit a third, half or more of any new income to paying down debt, boosting your savings or investing.

Here are four elements of the military pay system that give you the opportunity to succeed:


Periodic promotions are a celebrated part of life in the military. And as you well know, each and every one of those comes with a bump in basic pay. Opportunity.

Annual Pay Raises

Every January, in good years and bad, Uncle Sam bumps up military pay to keep pace with the employment cost index in the civilian sector. In recent years, the increases have been fairly small, but it’s an increase nonetheless. Opportunity.

Time-in-Service Pay Increases

Experience pays. Literally. Take a quick look at the Defense Finance and Accounting Service pay table and you’ll see time-in-service pay increases at years two, three and four, plus every two years thereafter. Some of those increases are substantial. For example, an O-3 who exceeds six years of service this year will realize a $247-per-month increase. Opportunity.

Allowances For Special Duty

These include allowances for separation, hazardous duty, flight and more. Additional skills or assignments can create a positive pop on your Leave and Earnings Statements. Opportunity.

Tax Advantages

If you’re deployed to a tax-free combat zone, less taxes means more money in your pocket and available to do financial good. Opportunity.

So, make the decision to allocate a portion (I didn’t say all…just a piece) of each and every one of these pay increases to save for emergencies, pay down debt or bump up your Thrift Savings Plan or retirement account contributions.

You’ll be setting yourself up for financial success.

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