How Common is Borrowing Among Military Members

Military members and their families go through multiple moves, as well as stressful situations that many regular families don’t have to encounter. This stress and strain on everyday life can sometimes cause a toll on a military member’s financial situation.

This is one reason why military members are possibly more likely to desire to take out various types of loans than their civilian counterparts. It’s a known fact, that some untrustworthy lenders do target military members due to the fact that their income is stead and assured and it’s easy to get them to start allotments to pay for items.

Agency Formed to Help Military Finances
In response to this, federal officials recently developed the Office of Servicemember Affairs as a new consumer protection agency to help military members and their families. This new agency is designed to make sure military members and their families get dependable and easy to understand information and training on financial matters and that any of their questions or complaints on financial matters gets answered.

Statics of Military Members Who Have Borrowed
Statistics from the FINRA Investor Education Foundation show that many military members are strapped for cash and do appear to be borrowing and/or relying on credit quite abit according to the following info:

• During the past five years about one in three enlisted personnel had taken out a payday, auto title or some other type of risky loan.
• 15 percent of military members surveyed had a mortgage, as well as a credit card balance of $10,000 or more.
• 50 percent of military members surveyed only made minimum payments on their cards or loans and a third had at least one late payment.
• More than half made only the minimum payment on credit cards, and almost a third of respondents reported a late payment in the past year.
• Only half were saving money for things like education or retirement.

Concerns About Military Borrowers
Money issues are said to be in the top three items of what stresses out the military family. The other two were deployments and war. Having financial problems is one of the main things that can cause a military member to lose their security clearance, so this is a big issue for military officials to consider and handle. This is why teaching military members and their families about how to handle their finances and how to recognize a good loan versus a bad loan are very important things.

Helping Military Learn About Finances
An organization geared to help military families learn about good financial decisions is Military Saves. This organization offers them tools to help save money instead of getting further into debt. It was started in 2007 by Army Chaplain (Major) Sarah Shirley. She says she started it because military members have been falling into the same trap as their civilian counterparts to spend instead of save money.

Those who participate in this program take a pledge to help themselves and others to reduce any existing debt and start building up wealth instead.

All in all, military members and their families are like those families in the civilian world. Money is something that everyone needs to live and most of us are likely to try to borrow it if we either don’t have enough of it or perceive that we need more of it. It’s important to learn to borrow money wisely and help protect the future and all of us, military or otherwise, can learn this valuable lesson.

Related articles:

• Debt Consolidation Loans: Military Members May Qualify For Priority
• Caring For Service Members
• Military Lending Investigations Begin