Military Finance

The social enterprise organization NFEC is dedicated to serving this country’s veterans and active duty military personnel. Certain organizations that serve the individuals who have served our country will receive complimentary resources as part of the NFEC’s American Dream Movement. The long-term goal is to prepare military personnel, through materials and training, for making sound financial decisions that align with their life goals.

Recently the U.S. government indicated its commitment to increasing the financial capabilities of military servicemembers by mandating military finance training and counseling for all armed forces personnel. USC 992 went into effect in July 2016, requiring the Department of Defense to give comprehensive personal finance training to all members of the U.S. armed forces.

The Office of Financial Readiness (OFR) is tasked to fulfill the requirements of USC 992. The OFR does so by providing military financial readiness training at each specified touchpoint and making Personal Financial Counselors/Managers available to armed forces members through regional Family Centers.

The military finance training must be offered at significant points in each servicemember’s term of duty. These touchpoints include: initial entry training, arriving at first duty station, at every duty station transfer, as part of leadership training, upon vestment in the Thrift Savings Plan, and upon promotion, pre-deployment, or post-deployment. Financial training also must occur at the time of any major life event during the member’s service. These important events may include marriage, divorce, birth of first child, and/or any illness or condition causing disability.

The mandate to provide comprehensive military finance training also specifies the broad set of money management topics that must be covered. The legislation requires that the following subjects be offered in this instruction:

In addition to carefully-timed military finance instruction, the mandate requires financial counseling services to be made available, upon request, to all armed forces members and their spouses. All counselors who provide military finance counseling services must be highly-qualified by educational or experiential background to offer valuable financial counseling to military personnel. These counselors must not have any conflicts of interest; they must demonstrate dedication to providing helpful information and counseling regarding current financial services and associated marketing practices to military servicemembers and spouses.

Several key reasons lie behind the legislation mandating military finance training for all armed forces members. The uncertainty and transitory nature of military life means that armed forces personnel face greater financial difficulties than do civilians. For example, according to the Consumer Financial Protection Bureau, in 2015 service members filed complaints about debt collections about twice as often as did the general population (46% versus 26% of all complaints). A survey commissioned by Zebit in May 2016 indicated that 44% of military servicemembers carry credit card debt, with 29% owing $5,000 or more. Further, unemployment is higher among military spouses; in June 2017 the U.S. Chamber of Commerce foundation Hiring our Heroes reported that the unemployment rate among military spouses was 16%, four times the rate for all adult women.