FORT RUCKER, Ala. (Feb. 16, 2012) -- The Department of Defense has designated Feb. 18-26 as Military Saves Week, and Fort Rucker's Army Community Service's Financial Readiness Office encourages Soldiers and Families to become aware and recognize the need to reduce debt and save money.
According to a memorandum put out in December by acting Under Secretary of Defense Jo Ann Rooney, the Military Saves campaign is a year-long effort while Military Saves Week is an opportunity for the entire military community to come together with federal, state and local resources to help military members and Family members reduce debt and save their hard-earned money.
"It provides an opportunity for leaders at all levels of all components -- active duty, National Guard and Reserve -- to motivate and educate service members and their Families," she said.
Although Military Saves is a nationwide campaign, Fort Rucker is doing its part to help the Soldiers and Family members of the local community in their efforts to save, according to Mike Burden, ACS Financial Readiness program manager.
Tables will be set up in the atrium of the Soldier Service Center Feb. 24 from 9 a.m. to 3 p.m. to educate people on the nationwide program and what is offered here on the installation for them.
"We will be there with all of our information and what we can provide for them," said the program manager. "We're going to ask people what they're doing to save money properly, show them what they can do if they don't have any plans in place and talk to them about the various saving vehicles that are offered such as a Thrift Savings Plan."
The TSP is a retirement benefit offered by the U.S. government to its employees that is similar to "401(k)" plans available from many private sector employees, according to Burden. Its purpose is to give those with the benefit the ability to participate in long-term savings and investment.
"Most importantly, when it comes to saving, people should have at least three to six months of emergency funds," he said. "When talking about emergency funds, some people have misconceptions and think we mean three to six months of income -- that's not true. When talking emergency funds, people should have three to six months of expenses, that's a big difference. It's a lot of money, but that's where we would like people to start."
According to Burden, many Soldiers, especially newly enlisted Soldiers, don't think about the need for an emergency fund or long-term saving, but the necessity is there.
"The most common thing that happens for most Soldiers is emergency automobile expenses," he said. "If they don't have an emergency fund in place already, they might have to take out a loan which could be more of a financial burden on them."
The goal is to get people educated on saving so they are aware of the different programs that are available to them, either through us or other financial institutions, said Burden.
"Money market accounts are another vehicle that we would like to educate people on," he said. "Money market accounts are basically savings accounts on steroids. They usually require a minimum balance, but the thing about them is they earn more than a typical savings account does."
Another added benefit of money market accounts is that the funds in the account are more available -- "it's very liquid," said Burden.
"People need to start saving early," he said. "The earlier you start, the earlier you can retire if you'd like and the more money you'll have when you do. Start saving early and the better off you'll be in the end."
A big benefit of the TSP, as far as saving is concerned, according to Burden, is that it's a long-term investment and Soldiers and government employees can get started on it early.
Another way he suggests people get a hold of their spending is to use cash over credit, saying when people use cash, they don't spend as much. Using cash instead of credit is the basis of one of the savings plans they use to help Soldiers get a hold on their finances.
"We have something called the envelope system," he said. "After reviewing an individual's finances, we will work out how much cash to allot to certain expenses such as rent, food or gas. We put that allotted amount of cash in and envelope and they can only use the amount of money in that envelope for that specific expenditure for the month.
"It's pretty basic and elementary, but it gives people an idea of where their money is going and they can actually see where their money is being spent," said the program manager.
Burden said that saving is all about the mentality and people have to have the "saving state of mind."
"In savings we always say pay yourself first," he said. "Make the decision to allot a certain amount of income directly into some type of savings or money market account, that way you don't see the money going away. It's the best way to save money."
For more information on saving or what the ACS Financial Readiness Program has to offer, call 255-9631.