Debt Reduction Tips for Military Personnel

In today’s post, I would like to share some debt reduction tips for military personnel.  I’ll be the first to admit that I haven’t always been good at managing my finances or personal debt.  In fact, I’ve done more dumb things than I care to remember!

Looking back, I remember some of the dumb financial decisions I made while I was a young Soldier. Some of those decisions include:

1. Buying a new car with high car payments

2. Spending most of my disposal income on unnecessary things

3. Not saving for retirement

4. Not setting up a budget or financial plan

5. Racking up credit card debt

6. Buying things to impress my friends

Like most of my friends and peers, I never received any formal education about debt, financial planning or budgeting.  As a result, I went deeper into debt each month and had nothing to show for the money that I did earn.

For the purpose of this article, I want to share some debt reduction tips for military personnel that I learned during my military career. Once again, I am not a debt counselor, financial planner or accountant. These are just some tips I learned along the way that helped me manage my money better.

# 1 Stop Going into Debt

The first thing you need to do is refrain from taking on any more debt. Do not allow yourself to get a new car, a new credit card or anything that puts you into further debt. The only way you will ever get out of debt is to stop acquiring more debt.

# 2 Come Up With a Debt Reduction Plan

You need to develop a simple and practical debt reduction plan. There are many helpful tools online to help you get out of debt. Just go to any of the search engines and search for “debt reduction plan.” You might also want to check on your installation or with your S1 Office to see if your base offers any free courses on money management.

# 3 Track All of Your Spending

You should track all of your daily, weekly and monthly spending. For a minimum of one month, keep a money journal and record everything you buy. You will be blown away at how much money you waste each month going out to eat, on entertainment, and other unimportant things. If you don’t track it, you won’t know where your money is going.

# 4 Get Help If You Need

Don’t be afraid to ask for help. If money management and debt really are big problems for you, get help. The sooner you can do this the better. Getting help is a sign of strength, not a sign of weakness. Don’t worry about what others will think. Only YOU can take responsibility of your own personal finances.

# 5 Get Your Spouse on Board

If you are married, or have a boyfriend or girlfriend, get them on board with you to become debt free.  It does you no good to have one person working toward becoming debt free, yet the other person still has out of control spending. Sit down together and discuss your goals and your plan.  Come to common ground.

# 6 Educate Yourself

There are tons of great books and courses out there about getting out of debt and taking control of your finances. Three of my favorite money books are:

  • The Total Money Makeover by Dave Ramsey
  • The Wealthy Barber by David Chilton
  • The Richest Man in Babylon by George S. Clason

All three of these books are practical, easy to read and loaded with great tips.  Get a copy from your local library to save money!

# 7 Set Written Goals 

Written goals are very powerful.  Once you have evaluated your current situation, set some short term and long term goals.  Write down these goals and put a copy in your leader’s book, one on your refrigerator, and one on your bathroom mirror.  Refer to them daily and evaluate your progress each month.

# 8 Celebrate Your Success

Make sure you celebrate your success in getting out of debt.  I’m not talking about going on a shopping spree, financing a new car or spending a few grand on a vacation either.  Make it a point to celebrate your progress each month, even if it is going out to eat, ordering ice cream or taking a day trip somewhere fun.

Final Thoughts

These eight things helped me a lot and I know they can have a similar impact with you.  The bottom line is to “man up” or “woman up” and take responsibility of your personal finances and debt.  Until you do that nothing will change.  Besides, it’s a temporary sacrifice that will really benefit you in the long term.

What are your thoughts?  What are your best debt reduction tips you can recommend, that worked for you?  Just leave a comment below to let me know what you think.

Here are a few other posts you might enjoy:

chuck holmes

Chuck Holmes
Former Army Major (resigned)

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14 thoughts on “Debt Reduction Tips for Military Personnel”

  1. Candace Ginestar

    My parents were terrible financial managers, and so I had to educate myself on finances. My husband and I both grew up poor, but at least his mom was thrifty and knew how to do a lot with very little. She didn’t believe in debt, and spent only what she made (even if it was pennies). This taught my husband the value of a dollar and then he educated himself on accounting, investments, and other financial topics. Now, he could teach classes to people on this topic. I wish I had a little class when I was growing up, because I didn’t learn much until I was older.

  2. Katelyn Hensel

    When we’re young, it’s almost always, “I’ll deal with that later”. And that kind of attitude can really come back to bite you in the butt later in life…particularly with credit card debt. I have one card and never spend more than I make because I’m too terrified of the looming debt and interest that comes with racking up debt.

    A money journal is an excellent tool. I too attempted to keep track of my monthly spending, and I was appalled with what I found. I was spending more money on eating out than my Car and Electric Bills combined. Thank you for the advice. There is a lot of good stuff in this post and I feel like I may be able to better navigate my own personal finances now.

    1. Going out to eat is a huge expense for most people. If you and your spouse go out once a week, just the two of you, it’s very easy to spend a couple hundred dollars a month of restaurant bills. That’s fine if you can afford it, but for most families the money is better spent if you invest in your retirement account or pay off debt.

      I’m glad you kept a money journal, Katelyn. Hopefully the lessons you learned can help you form new money habits.

      All the best.


  3. Financial issues are unfortunately as rampant in the Army as elsewhere. I agree that the education should start in school, but not necessarily in high school. As with so many other things early education is best. That being said, the Army does make an effort to educate soldiers as they come in, but more couldn’t hurt.

    1. I still think the Army should do a better job teaching personal finances. They could have mandatory personal finance classes like they do so many other classes. I wish I would have had this type of “mandatory brief” when I was a young Soldier at 18 or 19. Even if I didn’t apply what I learned right away, at least I would have known what my options were.

  4. Hey, I can relate to all five of those mistakes you made. It’s hard because nobody ever teaches you about handling money. I think personal finance should be taught in schools, so that people know how to avoid debt when they get a job and start earning. I find that just keeping track of what I’m spending money on is an important first step.

    1. I agree with you Andrew that personal finances should be taught in school. But even if it was, that shouldn’t keep the parents from teaching their kids how to handle money. At the end of the day, we all must learn how to pay ourselves first, keep debt to a minimum and live below our means. It’s easier said than done, but if you want to live a good retirement you have to sock some money away while you are young.

  5. Personally I think financial education should be a mandatory part of every high school curriculum. My parents and grandparents didn’t really teach me anything about the subject, and ignorance combined with youthful stupidity led me into some financial foolishness in college. The subject is extremely important. I taught accounting for a while at a vocational school, and I always set aside a day to talk to my students about personal finance and planning for retirement. It’s the same with soldiers, especially young soldiers. There are plenty of smart people out there who DO know a lot about finances working hard to figure out how to separate as many people as possible from as much of their money as possible, and yes, there are plenty of perfectly legal ways to do that. Get educated on the subject, ladies and gentlemen.

    1. I agree that personal finances should be taught in school, but in most cases it isn’t. As parents, we need to sit down with our kids and teach them about money. Even if our kids don’t listen to us (they probably won’t) or follow our advice right away, at least they will know what right looks like. And if you (the parent) aren’t educated about money, do yourself a favor and read a few books or take a personal finances class. It will be the best investment you can make.

  6. Debt is poison. It is one thing to have a credit card strictly for emergency purposes, and quite another to abuse cards to the point of financial collapse. While there are people who take everything to extremes, and certain types of debt are not necessarily terrible in and of themselves, for the most part it is good to keep personal debt to zero. The only major exception to this is a home mortgage, but even that point is open to debate.

    1. Debt is poison! What a great comment Larry. I’ve seen firsthand how debt has destroyed many families. Most families fight over money, lack of it specifically. Staying out of debt is a smart move. If you have to have debt, keep it to your mortgage and try to pay that off early, or go with a 15 year mortgage instead. Thanks for the comment.


  7. Good point, Faye. I truly believe everyone should have adequate life, health and auto insurance. Most people are one bad day away from losing everything financially.


  8. All of this is very good advice. Like other pages on your website, most of your advice can be given to everyone, not just military personnel.

    Another thing to consider is insurance. The military does take care of a lot for its members, but your readers need to be sure that they carry adequate insurance on their vehicles, especially liability coverage. Otherwise, one bad accident can wipe out everything they have worked so hard for.

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