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benefits_03-minThere is an old saying, “It is not the money that people make, but it is their spending habits which create financial difficulties”. No matter how much you earn, you have to know how to save and otherwise manage your money if you’re going to have any kind of financial stability. Often times military and Veteran families are used to automatic deposits from the government and this can cause a false sense of security. Transitioning into the civilian job market can be daunting and difficult to find a stable income or salary. For many, budgeting was never taught at home. To become stable learning to budget is necessary and it’s really not a big deal if you understand a few basic principles. You’ll be surprised at what it can do for you and your family once simple rules are applied.

Starting a budget is a great thing. Successful people have budgets and they track their dollars. “Budget” is not a “bad” word. It is just what is necessary to get where you want to go! A budget includes two main categories, income and expenses.

Some examples of types of income are:
• Fixed income– your basic pay or salary
• Variable income– commission you may earn or 1099 income

Some examples of expenses you may have are:
• Fixed expenses– your mortgage, car payment, child support or phone bill
• Variable expenses– groceries, eating out, gasoline, entertainment


• All Americans, even servicemembers, must pay their income taxes. If you are serving in a combat zone or hazardous duty region however, your income taxes are not due by April 15. If this is you then you qualify for an automatic extension of 180 days to file and pay your taxes.

• Military pay earned while you are in a designated combat region is not subject to income taxes for enlisted personnel and warrant officers. For commissioned officers, pay is tax free up to the maximum enlisted pay plus Hostile Fire or Imminent Danger pay. No action is necessary on your part to get the benefits. Federal Income tax withholdings are automatically stopped.

•Tax free income may be used to determine if you are eligible for the Earned Income Tax Credit or EITC. The credit may be used to offset your tax payments. In order to see if you may qualify for this credit you can visit

Many websites offer free budgeting worksheets, but if nothing else just grab a blank sheet of paper and divide it into two sections. For an easy exercise, on one side list your total income for a month including any and all steady income. If you make different amounts each month, average roughly what you earn in any given month. When in doubt, write down a lower figure rather than a high one.

On the other side of the paper list all of your expenses. Again, make estimates on things that vary from month to month. Average out other variable expenses (listed above) and costs and anything else that you regularly spend money on. Once you have both sides completed, total up both sides. To be financially sound, your income would be greater than expenses. If not, start looking at your expenditures and see where you can cut costs.

Training yourself to avoid spending unnecessary money is perhaps the toughest part of budgeting. That’s not to say that you should never go out to dinner or see a movie, but consider cutting back when it is too much. The goal is to reach a point where you have more money coming in than going out, and then to start a savings account. That savings account will be the first step to creating personal wealth and possibly a solid retirement fund for you and your family.