Money maneuvers for military men and women

While the fighting goes on in the Middle East and politicians and the citizens who elected them debate what moves to make next, our military personnel are dealing with not only potential personal safety concerns, but also money issues.

Regardless of whether you (or a loved one or a neighbor or a coworker) is active military or on-call via the reserves or National Guard, you face special financial considerations, both in times of peace and war.

Many issues, such as debt management, routine financial transactions and insurance coverage, are ones civilian and service personnel alike must handle. Others, such as managing your money when redeployed, called-up or sent into combat, require special attention by members of the armed forces.

This article, "Be Financially on Guard," originally published in the Dallas Morning News and reprinted on Military.com, does a good job of examining some of the specific fiscal concerns faced by men and women in uniform and their families.

Retirement planning enhancement: While military members, especially those in the thick of fighting, have many other things on their minds, when the time is right, they also should look at how a new law can help them save for retirement.

Previously, a serviceman or woman could not count tax-free combat pay when figuring how much he or she could put into an individual retirement account. The Heroes Earned Retirement Opportunities (HERO) Act, signed into law this past Memorial Day, changed all that. Now, members of the U.S. armed forces can use that hazard pay to add to their IRAs, both as regular and catchup contributions.

If this IRA change affects you or someone you know, you can read more about it in this National Association of Tax Professionals release, as well as in this IRS announcement.

And it might be easier for service personnel, regardless of whether they get regular or combat pay, to put away a bit more now. House and Senate negotiators agreed to a $447 billion Pentagon funding bill that includes a 2.2 percent pay increase for the military.

Comments

[dimes]

It's about time!