When a soldier came into Ana Hernandez's office at Fort Bliss, Texas, recently to get help with financial problems, a big expense was quickly apparent to her: a $630 monthly payment for furniture — on an E-3's salary.
"We see a lot of people financing furniture and electronics," said Hernandez, personal financial readiness specialist at the Fort Bliss Army Community Services center. "They're buying laptops, gaming systems, big-screen TVs — toys, basically. Unfortunately, they do this before we even get to them."
That $630 payment is at least one-third of an E-3's monthly basic pay. "We advise that they shouldn't have more than 15 percent of their paycheck going to unsecured debt" such as credit cards and loans for anything other than vehicles and homes, said Hernandez, an Army spouse.
"We suggest they save for emergencies, then invest for their future," she said. "We try to make it painless, and ask what areas they're willing to cut back to shave $20 here, $30 there."
For example, some single service members are paying $150 to $200 a month for cell phones — and may not even realize the expense is that high, she said.
Hernandez and other financial specialists at military bases around the world are there to help troops and their families not just live within their means, but also save money.
They want troops to avoid high-cost debt and get their financial lives on track so they can plan for the future.
Hernandez said she wants troops to experience the peace of mind that comes from not being weighed down by debt, from having an emergency fund to cover unexpected expenses, and from saving to buy big-ticket items to avoid the cost of financing them.
Personal financial readiness experts such as Hernandez usually are found at or through family centers on base. Here are four reasons to visit them:
• Their help is free.
• They'll review your finances, looking to see how much money is coming in, how much is going out, and how much extra you might be able to pay to get out of debt. And their help can go even further — Hernandez has found mistakes in bills that had some soldiers paying for items that were not even theirs.
• They can help you think about whether you can really afford to buy that car, that furniture, those electronics — reviewing your finances before you buy. "We try to catch them before they finance something that might be way over their heads," Hernandez said.
• They help you find ways to lower your finance costs. For example, troops might have a car loan at a high interest rate because they're young and haven't established credit, or they have made some missteps in handling their finances. Or they might not have shopped around for a good loan.
"We tell them that after 12 months of good payments, to refinance," Hernandez said. That might be with another financial institution, if the original lender won't lower the original rate.
Hernandez helped one soldier who was paying 27 percent interest and was paying on time, even paying a little extra each month. Hernandez called the credit card company to see if it could reduce the rate to 0 percent for 12 months. The company agreed to lower the rate to 15 percent. "It's still higher than we would like, but we got it down," she said.
Car buying in Afghanistan
Like most other concessionaires, Exchange New Car Sales will have to leave Afghanistan over the next couple of months, following an order from the top U.S. commander in Afghanistan, Army Gen. Stanley McChrystal.
But that doesn't mean troops deployed there can't order new vehicles at a discount.
At http://www.encs.com">http://www.encs.com, you can still order your vehicle online if you are on active-duty status and stationed outside the 50 states permanently or temporarily for 30 consecutive days or more.
"With the complexity of buying a car, sometimes face-to-face is better, but we follow the rules and move on," said Desmond Powell, vice president for sales in the Middle East for the Overseas Military Sales Corp. "We operate at the discretion and invitation of the military. We understand it's a war zone, and we follow the rules. We have to realign our efforts."
Troops with questions can chat live on the Web site with customer service representatives, or contact the company by telephone or e-mail, Powell said.
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