The military spouse's guide to reducing financial stress

It's common for military members to refer to their spouse as the CFO of the household. While it's a wonderful compliment, it also means the spouse has the responsibility and stress of properly managing the family's financial goals.

Building financial success is a long-term plan and does not happen overnight. It comes from years of learning, growing, making mistakes, and sometimes pure trial and error.

This article looks at the steps you can take to help reduce financial stress and better prepare for the unexpected.

Get on the same page.

Both spouses don't have to be involved in every detail of financial planning, but you should align on what you're hoping to accomplish.

Consider taking your special someone on a financial date, where you talk openly about your financial planning and begin to formulate a plan and shared goals. The first time you have this conversation may be difficult, but the more it happens, the easier it becomes.

Have a plan and stay within a family budget.

Once you and your spouse are on the same page, the next step is to build a plan to reach your long-term goals. This starts with having a family budget.

One of the best benefits of being in the military is a reliable stream of monthly income. You can use it to precisely build a budget that helps you pay off debt and plan for the future. Use your budget to map out your basic living expenses. Be sure to include saving for both short- and long-term goals.

For short-term savings, it's recommended to start with a goal of $1,000. Consider a liquid account that you can access quickly to cover any unexpected expenses, like a savings account. Once you've saved $1,000, you should continue saving until you have three to six months of living expenses.

How much should you save? Start with a percentage of your income that's realistic for you, whether that's 1% or 15%. Then, continue to increase your rate of savings with every promotion and merit increase you receive. Strive to save 10% or more of your income consistently.

Automate your finances.

Automate as much of your finances as you can, including bill payments and savings. Many banks offer free online services that make paying your bills automatic. There's a freedom that comes from not having to keep track of due dates for various family payments. Automatic payments can also help you avoid late fees, which add up over time.

For savings, consider using an automatic funds transfer to support your long- and short-term savings goals. By automating your savings contributions, you can adjust to the income that's left after your savings are deducted. If you never see the money you're setting aside, it becomes a lot easier to live without it. This increases your chance for long-term saving success.

Get the proper protection to secure your plan.

Getting the proper protection in place for your family and your possessions is rewarding. You gain peace of mind in knowing that if something happens, you're covered. There are many types of protections available, and each one is used to cover different unexpected events.

TRICARE

TRICARE is a health care plan built exclusively for military members and their families. TRICARE will be your health insurance provider if your service member is on active duty. National Guard and Reservists may have eligibility depending on duty status. TRICARE is accepted anywhere Medicare is accepted, and generally your out-of-pocket medical service costs are going to be little, if any.

SGLI and FSGLI

Servicemembers' Group Life Insurance (SGLI) and Family Servicemembers' Group Life Insurance (FSGLI) offer low-cost life insurance coverage to eligible service members and their families. SGLI or FSGLI coverage could be the starting point for meeting your life insurance needs, depending on your family's situation.

You'll want to consider your income, assets, liabilities and other factors to determine the appropriate amount of life insurance. Consider the acronym LIFE (liabilities, income replacement, final expenses and education) as an easy way to determine the amount of total life insurance you need.

Renters insurance

A great way to help protect your personal possessions if you're living in a rental home or an apartment is renters insurance. This insurance is designed to protect your personal items in case they're damaged, lost or stolen. Some renters insurance policies will even replace your military uniforms and gear in the event of a covered loss.

Renters insurance is easy to transfer when you move and will cover your personal property anywhere in the world. After purchasing, create an inventory of your possessions and consider supplementing this list with photographs or video.

Understand your auto insurance policy.

If you own a vehicle, it's a must and often a legal responsibility to have auto insurance. Not all auto insurance policies are equal, so it's important to understand your individual policy to ensure you're covered in the most efficient manner. Think about how your driving habits may have changed in the past year, as annual mileage is a rating factor in the majority of states. Be sure to ask about discounts when reviewing your auto insurance. Discounts change often and can vary by location.

It's also critical to understand your deductibles and coverage limits. Higher deductibles and lower limits will often lead to a lower monthly payment. But that may also mean a higher out-of-pocket cost if an accident happens. As a starting point, strive for liability limits that cover your net worth. You should review your auto policy at least once a year and with any major life change.

Legal documents

You'll want to have power of attorney forms and other estate planning documents in order before a deployment or PCS. These documents can be customized to provide you and a loved one the ability to act on behalf of each other. They're essential if your spouse leaves for an extended period due to a deployment or TDY. Visit your local JAG office to help create these documents.

Disaster preparation

Managing natural disasters as a military spouse can be doubly stressful when your service member is called to active duty or unavailable to help on the home front. In addition to having insurance coverage, there are things you can do to prepare for and limit the impact of a disaster. Being prepared can give you a greater sense of control if disaster does strike in your area.

Join a spouse support group.

Every unit has a family support group that you can join. These groups help you connect with military families in your unit. The National Guard and the Reserves have family readiness groups as well, which offer a great way to meet other military families.

The family support group is made up of volunteer families within the unit who work to bring people together. The groups aim to alleviate stress for service members and their families. They often plan fun events that you can attend by yourself or with your family. Visit the Family Support Center on your base to learn about the group in your area.

Keep your eyes on the prize.

If recent events have taught us anything, it's that there will be times when things don't go as planned. This happens to all of us, and it can be frustrating. In moments of frustration, remember the plan you built for your family and take a few minutes to visualize long-term success. Understanding the path ahead can make it easier to handle life's inconveniences.