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Financial Resources for Veterans in Debt

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Many of America’s military service members and veterans report that financial stress is hurting their emotional and mental health as well as their ability to set future goals.

Among the respondents to a 2017 Military Family Advisory Network survey, a staggering number — 92.5% — reported they have debt, while 44% of the group reported financial stress is detrimental to their emotional and mental health. The report detailed the financial burdens of 5,650 in active military service, veterans and their family members.

What it uncovered is a problem that for many American military families runs deeper than simply taking on too much debt.

The majority — 60% — said they do not have enough savings to cover three months of living expenses. Some respondents said they struggle to provide basic needs like food and child care, and 49% reported an unwillingness to further their education because of financial barriers.

In short, the Military Family Advisory Network report said military and veteran families have a hard time getting ahead financially.

What drives veterans into debt

Relocation expenses

While civilians may have similar financial struggles, Joseph “J.J.” Montanaro, a certified financial planner with USAA, which provides financial products and services for the military community, said those struggles can be compacted for military families because of the military lifestyle.

Nearly 32% of respondents in MFAN’s report said they have moved three to five times, and 79% of all respondents said moving caused high financial stress.

“When you don’t know when the next move is going to come, while the government covers the majority of expenses with a move, there are always going to be those things that aren’t covered — something as simple as putting the kids in new sports programs or paying all the deposits on your utilities,” said Montanaro.

Bruce McClary, spokesman for the National Foundation for Credit Counseling (NFCC), attributes the largest financial concern to relocation. McClary worked as a financial counselor for military families and saw the issue of relocation resurface several times.

“When you’re relying as much on a dual-income household, and you have to relocate because of the job of one spouse, whether you’re military or not, that’s going to cause some disruption,” McClary said.

Despite the logistical and financial support from the military, McClary says there could be immediate or lasting impacts on the family’s financial resources if the civilian spouse has to find a new job with possibly lower income.  

False sense of financial security

Although military families have more job security than other sectors, Montanaro said that steady paycheck can create a false sense of security, which can easily discourage savings. In some of cases, families or individuals won’t set aside funds for emergency situations because they feel as if they have a guaranteed income.

Furthermore, service members returning from long deployments overseas may seek to make up for lost time, he said, and make spending decisions that are based on emotions (like buying a new car or going on a family trip) but don’t make the most financial sense.

“When you look at the military culture, it puts a premium on independence and taking care of yourself and not being a burden,” Montanaro said. “It’s not necessarily a culture that ingrains the idea of asking for help.”

Lack of savings and a desire to manage matters themselves can also leave military families searching for ways to fill in the gaps. Those who do not have much experience managing money may be vulnerable to predatory lenders and aggressive debt collectors.

Predatory lending, whether through auto financing or payday lenders, starts with living beyond your means, Montanaro said.

By volume, debt collection — including attempts to collect a debt not owed — tops the list of service members’ complaints to the Consumer Financial Protection Bureau and outstrips similar complaints made by nonservice members in every state and territory, except North Dakota, where it comes second in the list of complaints.

Where servicemembers can seek financial support

On base. Every military installation has a personal finance management program, on-installation counselors, and on-base advisers that can help answer financial questions, Montanaro said.

“Look to those on-base or on-installation resources, because they’re there for the express purpose of helping military members get to a better place financially,” he said.

NFCC and Military OneSource: The nonprofit NFCC partners with Military OneSource, which offers strategies to help service members consolidate and pay down debt, as well as save for retirement or college and create financial plans. The NFCC, which is the longest-serving and largest national nonprofit financial counseling organization in the U.S., also has a branch specifically to help with military families’ debt relief.

Financial Institution Regulatory Authority: The Financial Institution Regulatory Authority (FINRA) offers a fellowship program for military spouses to earn an Accredited Financial Counselor certificate and to develop financial skills. The program is in partnership with the National Military Family Association, and there is no cost to participants. More than 1,480 fellowships have been awarded since the program began in 2006; applications are accepted until the end of April.

ClearPoint Reconnect: The program provides online and phone counseling in English and Spanish, online financial education (courses include Managing Financial Stress and Reshaping Credit) and identifies local resources to help veterans reach their short-term financial goals and create economic stability. The counselors are knowledgeable about opportunities through HUD, FDIC and the U.S. Department of Veterans Affairs. ClearPoint has partnerships with organizations such as New Directions for Veterans and Operation Homefront. ClearPoint, an Atlanta-based division of Money Management International, says there is no cost for military service people to participate.

Consumer Financial Protection Bureau’s Office of Servicemember Affairs: The CFPB, a government agency that makes sure banks, lenders and other financial companies treat consumers fairly, recognizes the unique financial challenges military families face. CFPB’s Office of Servicemember Affairs monitors complaints, and offers tools and resources to assist military homeowners, make student loans more affordable, provide predatory loan protections and recover money for military members who have been targeted by scams and illegal practices.

Operation First Response: For more immediate help, Operation First Response offers financial assistance for groceries, utilities, rent and clothing to veterans suffering from physical disabilities and mental distress. In 2017, the nonprofit helped 1,366 veterans, with the average grant size between $500 and $1,500.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Maggie Scruggs
Maggie Scruggs |

Maggie Scruggs is a writer at MagnifyMoney. You can email Maggie here

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How to Save on Back-to-School Shopping

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Parents often revel in the calm and quiet that comes when kids head back to school, but they aren’t likely to enjoy the excess spending that also accompanies the back-to-school season. According to the National Retail Federation, parents will set a record in 2019, spending an average of $696.70 per household on children in elementary school through high school.


“It was interesting to see the across-the-board increases in spending levels,” said Mark Mathews, vice president for research development and industry analysis with the NRF. “Elevated levels of consumer sentiment, healthy household balance sheets, low inflation and recent wage gains all seem to be contributing to a confident consumer who is willing to spend money on back-to-school supplies.”

If you’re planning a trip to the store before classes start, there are a few ways to curb the spending and save some bucks.

Plan ahead

No parent should set foot out the door for back-to-school shopping without first taking stock of what they already have. Plenty of old supplies from previous years might still be usable, especially arts and crafts items like crayons, pencils and pens, as well as more expensive things like backpacks, lunch boxes and calculators.

Crossing a few items off your list is a good first step when it comes to saving, but learning how to budget is also important. It’s tempting to run down the back-to-school aisle and grab every colorful notebook and snazzy pencil case in sight, but it doesn’t make a lot of financial sense. Create a realistic budget based on the items you actually need, and try your best to stick to it. If possible, do most of your shopping online, since it’s easier to keep a running tally of how much you’re spending as you shop.

Be smart about sales

Although you’re bound to run into many back-to-school sales this time of year, you don’t need to buy 12 notebooks just because they’re cheaper right now. In fact, you shouldn’t assume the sales price is the best price at all, said consumer savings expert Andrea Woroch. Instead, always comparison shop.

“Run a quick Google search online or on your phone to see if another store is selling the same or a similar item for less,” she said. “Most big box stores will price match, so you won’t even have to drive to another store to get the better deal.” For example, Target, Staples and Walmart all have price matching policies.

Clip coupons and shop discount stores

Coupons have definitely made a digital comeback, with countless apps and websites dedicated to listing all your options in one place. “Spending a few minutes looking for coupons can help you get a better discount,” Woroch said. “Use apps like CouponSherpa, for instance. Or, use the Honey browser tool, which automatically searches and applies relevant coupons to your online order.”

Many stores also offer discounts to valued customers who sign up for their rewards program, like Walgreens and CVS, while craft stores like Michaels regularly offer discounts. Don’t knock purchasing basics like paper and writing supplies from the Dollar Tree, either — you might be surprised by what you find, and those types of items are often the same quality wherever you buy them.

Tax advantage of tax-free holidays

On select dates throughout the year, different states offer state sales tax holidays, or days where you can purchase items without having to pay sales tax on them. You can find a full list of the 2019 state sales tax holidays here, but some upcoming ones include:

  • August 18-24: Connecticut, clothing and footwear
  • August 17-18: Massachusetts, specific items costing less than $2,500 per item

Split bulk purchases

You can usually save money by buying certain items — like construction paper, pens, pencils and folders — in bulk, but you can save even more by splitting those bulk items with other families. Not only is this a great way to share savings, Woroch said, but you can earn rewards faster by charging everything on your card and then having the families pay you back.

Redeem your rewards

If you have a cash back credit card, now’s the time to use it. “Most credit cards give you the best redemption value when you opt for statement credit or have the cash rewards deposited into your bank,” Woroch said. “You can set this money aside for back-to-school shopping.”

Alternatively, Woroch suggested checking to see if your particular card allows you to redeem points for gift cards to retailers where you plan to shop.

Use discounted gift cards

Besides redeeming credit card points for retailer gift cards, you can also scour the web for cheap gift cards online. Planning a trip to Target? Scan websites like Raise, Cardpool and CardCash first. These sites buy and sell unused gift cards at a discount, meaning you can save on purchases you were planning to make anyway.

Consider having your kids contribute

Depending on your child’s age, back-to-school shopping might be the perfect time to start having them contribute to their own goods, especially if they earn an allowance or have a job. Talking to your kids about money at a young age — whether about budgeting, saving or spending — will help them develop solid money habits that will pay off in the future.

Parents already seem to be catching on to this idea. “It was surprising to see how much of their own money kids are contributing towards the back-to-school bills,” Mathews said. “Teens and pre-teens will be spending $63 of their own money, which works out to $1.5 billion overall. This is significantly higher than the levels we saw a decade ago.”

Although the news about increased spending on back-to-school supplies may be alarming, these days there are more ways than ever to save. A little ingenuity, resourcefulness and research can go a long way.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Cheryl Lock
Cheryl Lock |

Cheryl Lock is a writer at MagnifyMoney. You can email Cheryl at [email protected]

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Survey: Most Americans Have Raided Their Retirement Savings

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Successfully saving for retirement requires dedication and self-restraint, but more than half the country admits to robbing their future selves in order to satisfy today’s spending needs, according to a new survey by MagnifyMoney. While the economic pressures bearing down on workers today make their actions understandable, the hard truth is that many Americans are turning an already-difficult task that much harder by tapping into their retirement savings early.

Key Findings

  • Approximately 52% of respondents admit to tapping their retirement savings account early for a purpose other than retiring: 23% have done so to pay off debt, 17% for a down payment on a home, 11% for college tuition, 9% for medical expenses, and 3% for some other reason.
  • About 29% say there are some scenarios where it is a good idea to withdraw money early from a retirement savings account.
  • Around 60% of respondents do not know exactly how much they have saved for retirement. Just 40% know the exact amount, while 45% have a rough idea, and 15% have no clue.
  • Almost 25% are unhappy with their retirement savings. 47% are happy with the amount saved, and about 28% are neither happy nor unhappy.
  • Finally, 27% have never thought about how much money they’ll need in retirement.

Why are Americans tapping their retirement savings early?

The two main reasons respondents cited for withdrawing money from their retirement savings are as American as apple pie: home ownership and personal debt. According to the survey, 23% of those making an early withdrawal did so to help pay down non-medical debt, while 17% needed the money for a down payment on a home.

Although the housing market appears to be cooling off compared to just a few years ago, a down payment on a home still requires a significant chunk of change — experts recommend a down payment equaling 20% of the total mortgage to optimize your mortgage payments.

Personal debt, from credit cards to student loans, remains a fixture of everyday economic reality for millions of Americans. In other words, the stressors that cause workers to raid their retirement funds don’t look like they will decrease appreciably in the foreseeable future.

Which Americans are withdrawing money the most?

Breaking down the demographics, older savers are less likely to withdraw money from their retirement fund than younger savers. 54% of millennial savers say they’ve taken an early withdrawal from a retirement savings account, compared with 50% of Gen Xers and 43% of baby boomers. This stands to reason considering that many millennials have now entered the stage of life where they are getting mortgages, starting families and taking on bigger financial obligations while also being decades away from the traditional retirement age. Millennials are also more likely to say that raiding your retirement fund is justified under certain circumstances, as seen in the chart below:

Just one of many bad retirement savings habits

Tapping into retirement funds — whether an employer-sponsored 401(k) or a traditional IRA — before the appropriate age almost always comes with a financial penalty in the form of additional taxes and fees. What is more, you’re diminishing the principle that fuels the compound interest you need to meet your retirement savings goals.

Unfortunately the survey reveals early withdrawals are just one of the many bad habits Americans engage in when it comes to retirement savings. This list of less-than-ideal practices includes:

  • 35% of Americans are not currently saving for retirement. Of those who are, 37% started saving at age 30 or above, and 12% started saving when they were older than 40.
  • 60% of Americans do not know exactly how much they have saved for retirement. Just 40% know the exact amount, while 45% have a rough idea and 15% have no clue.
  • Nearly 1 in 5 Americans don’t contribute enough to their employer-sponsored retirement account to get the maximum company match. Maximizing a company match is one of  your best ways to maximize your retirement savings. Among those with an employer-sponsored retirement savings plan, just 17% of respondents contribute 10% or more of their take-home pay. Almost 5% contribute nothing at all, and nearly 6% are unclear about how much they contribute.

  • Approximately 42% of respondents have made the mistake of withdrawing their entire balance from an employer-sponsored retirement plan when changing jobs without rolling it over – and nearly 15% have done so more than once. A little more than 47% of millennials admit to this faux pas.

The most damning finding of all is that 27% of those surveyed have never thought about how much they’ll need in retirement. And while “ignorance is bliss” may hold true when it comes to some things in life, this expression should not apply to your retirement plans.


MagnifyMoney by LendingTree commissioned Qualtrics to conduct an online survey of 1,029 Americans, with the sample base proportioned to represent the general population. The survey was fielded June 24-27, 2019.

Generations are defined as:

  • Millennials are ages 22-37
  • Generation Xers are ages 38-53
  • Baby boomers are ages 54-72

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

James Ellis
James Ellis |

James Ellis is a writer at MagnifyMoney. You can email James here