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Wingman Day discussion results: Personal financial management needs to be a high priority for all ranks

by Maj. James W. Barber
6th Medical Support Squadron

Managing our finances is something that about 98 percent of us could probably do better. I'm not just talking about keeping our checkbook up to date or ensuring our bills are paid on time. I'm talking about setting ourselves up for success tomorrow.

I'm also talking about not just living for today and resisting temptation to overspend by digging ourselves the proverbial hole we can't get out of. We need to pay as much attention to our finances as we do to waxing that new car or studying for that mid-term exam.

As military members we often encounter pitfalls or roadblocks which can jump up and cause financial difficulties. Some of our most at risk Airmen, Soldiers, Sailors and Marines are the brand new enlistees. Those in the grades of E-1 through E-4 are most at risk to falling into financial peril.

Enticing offers from payday loan businesses can be seen right outside the gate of most installations, and while they will help you meet today's need for quick cash, the price you pay tomorrow is often far too steep. Many of these businesses offer these loans at outrageous rates of 50-300 percent interest.

Before long, that $100 payday loan ends up taking four months and $550 to pay off. No wonder they are so friendly and understanding to someone's need for some quick cash.

Other pitfalls for our young service members are the temptations to go get a new car, new furniture, credit card or new home stereo system.

Local businesses and auto dealers know servicemembers are going to get a paycheck on the first and 15th, and that they are going to get their money one way or the other. Often people fail to realize that the new 2006 model they just bought is going to cost much more than the $440 a month car payment. They fail to factor in issues such as insurance on that car, gas and maintenance costs, etc. Before they know it, those payday loans are looking good again and the trouble starts.

These issues aren't of course limited to our young troops. All ranks are subject to money mismanagement. However, statistics in the military point to the bottom three enlisted and bottom two officer grades as the most likely to encounter these problems. For many in those groups, it is their first time away from home. They've never had to manage money before.

Now all of sudden, they are making pretty good money, they've got a checkbook, credit card offers are coming in the mail everyday, they get their cable and phone bills and they either sink or swim.

Here is where supervisors play a key role in the Wingman process. We need to talk to our troops about things like finances. We need to have an idea how "Johnny" is doing and whether or not he is digging himself a financial hole that could open up doors to other troubles, both psychological and physical. We've probably all learned a lesson or two the hard way. Don't be afraid to share that information with your troop and give advice on how to avoid those pitfalls and be successful.

During the recent Wingman Day sessions, it was discovered that many of the attendees had at one time or another lived paycheck to paycheck. In fact, some were doing it then and may still be doing so now. Many had not invested in the Thrift Savings Plan offered by the government because they did not understand it. One Airman actually thought that he'd lose the money because he didn't plan to reenlist. That is simply a case of someone not getting the right information to that young Airman.

The military offers several outlets to enhance our ability to manage our money better. The Family Support Center offers programs to help, and there are often other briefings offered by financial institutions off-base which military members can attend for free. Air Force Aid offers loans and grants to those who are facing a financial hardship. Supervisors and first sergeants can assist with this option. Plus, there are thousands of informational web sites just a few clicks away.

Retirement is something many of us don't think about until it is almost too late. No matter someone's age, they should consider saving for retirement. One option is the TSP that all military members are eligible for. We no longer have the open/closed seasons and Airmen can sign up at any time and beginning in 2006 they can contribute as much as they like each month. Currently the bar is set at 10 percent per month.

Other options include, but are not limited to, Individual Retirement Accounts, stock purchase plans, regular savings accounts, certificates of deposit, etc. Many places such as USAA offer the opportunity to invest for as little as $25 a month in an IRA. Even that small of an amount may add up to millions over a 40 year period. The earlier someone starts, the more they'll have at retirement age.

Life is a one-shot game. We only get one shot to do it right. Learn from the experiences of others and make the best decisions for yourselves and your family. Treat money as the critical asset it is and take care of yourself. If you take care of your money now, it will take care of you later.

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