When service members return from their duty, they are more likely to face financial troubles than the rest of the population. Research carried out by the NFCC revealed that they are nearly twice as likely to be managing credit card debt on a monthly basis. In addition, nearly two-thirds of veterans have difficulties in finding employment and are also struggling with military service induced health issues. Following the advice below for managing finances during this process could significantly help ease the transition for many veterans.
Loans and mortgage payments on a new home
Veterans can better manage their credit by educating themselves on the services that are out there that can help provide sound financial advice. If looking to purchase a new property, then a VA loan is a good option , however, holding off on a home purchase until there is enough money to make a decent down payment would help avoid unnecessary fees.
Veterans are also more likely to end up making late mortgage payments. The most obvious way around this is carefully evaluating your monthly expenditure and assessing whether too much money is being spent elsewhere. If there is no leeway when it comes to other financial commitments, then it might be time to consider mortgage refinancing.
How to effectively manage credit
If a veteran is struggling to manage their credit then it is important to seek help from a non- profit organisation before the situation gets worse. Often when someone has trouble managing their credit, it is usually a sign of other financial difficulties such as problems with budgeting, money management and being in debt. Getting on top of any debt should be a priority. A report by the Consumer Financial Protection Bureau confirms that veterans are more at risk than the general population in debt collections.
Getting out of debt
If a veteran is slipping into debt then action needs to be taken to combat this before it escalates. The first step is to get rid of any unnecessary spending. During tough financial times, sacrificing on costly luxuries such as eating out, shopping or cinema outings is difficult but it’s a must.
If it turns out that too much money is being spent on addictive substances such as alcohol and tobacco, then it may be a good time to seek help in cutting down or quitting, which would have a positive effect on both finances and health. Also, if it is possible to pay more than the minimum payment, then incrementally this will help someone get out of their debt even quicker.
Improving your credit score
Looking at ways to improve credit score is important, making payments on time and avoiding letting any bill go into collections are the two biggest priorities. Making small changes like this can improve a credit score quite considerably after just one year, helping bring someone much closer to financial freedom.
Veterans face many financial issues alongside psychological and physical ones. The latter two may interfere with a veteran’s ability to work and therefore to keep solvent. However, as discussed in this article there are solutions and support mechanisms for veterans. Whether you are a veteran or are a relative/friend of one, pass on the message. Let’s give a little back to those who defend our liberty.