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Bottom Line Up Front

  • Financial preparation is essential to create a long-term plan of success. 
  • Start by creating a budget and financial accounts so you can establish an emergency fund and save for retirement. 
  • Set up financial protections such as insurance and cybersecurity to protect your assets.

Time to Read

4 minutes

August 5, 2022

Congratulations on your decision to join the military! As you adjust to the many changes that come with life as a servicemember, you’ll want to pay plenty of attention to your finances. Steps taken early in your service can help you establish financial security for the short and long term—no matter where your military career may lead. Here are 8 tips to get you on that path.

  1. Create a budget. A budget is a monthly spending plan to help you manage your income and expenses as well as identify areas of potential savings. Even if you had a budget before joining, revisit it to take into account your military pay and benefits, such as the Basic Allowance for Housing (BAH), if applicable. To create one on your own, you can make a list of income and expenses each month, use budgeting software or try out the Navy Federal Credit Union budgeting template.
  2. Set up checking and savings accounts. Establish checking and savings accounts to help you handle and grow your money. Take advantage of free online and mobile banking so you can stay on top of your finances from wherever you’re stationed.
  3. Establish an emergency fund. If you’re eligible for an enlistment bonus, you might be tempted to make a big purchase. But you may be better off stashing that money away to cover unanticipated expenses. Many financial advisors suggest having a savings cushion to cover at least three months of living expenses. That way, you’re prepared in case you or a family member has an illness or accident, your spouse loses their job or you’re faced with unexpected home or auto repairs.
  4. Minimize debt. Avoid impulse shopping. Stay off online shopping sites if you have trouble resisting the temptation to add items to your shopping cart. Use credit cards only when you can pay off the balance each month. If you’re in debt, create a plan to pay it down as quickly as possible.
  5. Use credit wisely. Wise use of credit can help you improve your credit score—a ranking that is likely to impact your future credit interest rate. Paying off loans, making payments on time and not using credit excessively can get you headed in the right direction. Shop around for the best interest rate when taking out a loan for a major purchase like a car, motorcycle or home. Investigate government-supported financial assistance for military members and their families, such as VA loans and the GI Bill. Finally, if you can’t pay monthly bills, beware of the costs of payday loans. These short-term loans generally have very high interest rates, and many people fall into a trap of reborrowing. As interest costs pile on, they fall further behind. Instead, look into taking out a small personal loan or applying for a checking line of credit. You may also want to consider financial counseling.
  6. Save for retirement. Take advantage of the Thrift Saving Plan (TSP) (or Blended Retirement System (BRS), now available to new servicemembers). These plans allow you to save to make tax-deferred payments, so your contribution can grow without the drag of taxes. Even if you expect to remain in the military long enough to qualify for a full military pension, it may not be enough to cover all your retirement expenses. And, plans change—you could leave your military career early. You can still roll over your TSP balance into an Individual Retirement Account to keep your money working for you until you need it.
  7. Protect your finances. Consider what insurance coverage you may need. While your military service provides health insurance, you may need other insurance coverage, such as auto, homeowners, renters, life and long-term disability. These types of insurance help you protect your assets or provide financial security to your dependents in the event of your untimely death or disability.
  8. Practice good cybersecurity. When setting up your financial account, make your passwords strong. Avoid accessing your accounts over public Wi-Fi networks. Protect your account and personal identification numbers (PINs). Be alert to unauthorized charges on credit cards or unusual withdrawals from your savings and checking accounts. Notify your financial institution immediately in the event of suspected fraud.

We’re here to help you achieve financial readiness.

Navy Federal is here to be your trusted financial partner, so you can concentrate on your critical role as a servicemember. We offer a full range of financial products and services as well as online resources such as Military Life to help you navigate your new life in the military.

Next Steps Next Steps

  1. If you don’t have them already, create savings and checking accounts at a trusted financial institution like Navy Federal. This will allow you to establish an emergency fund and manage your finances on the go. 
  2. Take a close look at your income and expenses each month. Create a budget that accounts for your military pay and benefits and make a plan to pay off any debt you’ve accumulated. 
  3. Make plans for the long term, including establishing a retirement fund and thinking about the types of insurance you and your family may benefit from. 


This content is intended to provide general information and shouldn't be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.