Basics of Budgeting for Military Families

Basics of Budgeting For First-Time Budgeters

Have you ever wondered where all your monthly income went? We work hard every week and can’t seem to save anything or invest in our future. Some don’t have a budget and don’t keep track of how they spend over time.

Budgeting can be a day-to-day transformation of how you value and treat your hard-earned money. It won’t fix or solve your financial problems immediately, but it will change how you view your money and how it works for you.

Step 1 – List Income and Expenses

Know your current income. Net income calculates the amount of income you receive after taxes and deductions. Net income is the baseline you should use to standardize your budget as it simplifies your expected take-home pay.
Know your future income. Military members can view their pay charts to see what they will earn in the next higher pay grade or even in the next higher pay tier based on time in their current rank. Future budgets may depend on those numbers; it’s smart to anticipate them.
Know your future expenses. Are you planning a change in family size? Do you have a school-age child you’ll be sending to college soon? Anticipate these future costs, they will be upon you sooner than you think.
Determine your monthly fixed expenses. Fixed expenses do not change from month to month. List all fixed expenses you have whether they are essential or discretionary such as; car payments, insurance, phone bill, Netflix, rent, savings, investing, and student loan payments.
Know your variable expenses. Variable expenses can change from month to month. List all variable expenses you have, whether essential or discretionary such as; fuel, food, entertainment, clothing, and home or vehicle maintenance.

Step 2 – Subtract Expenses From Net Income

Set aside money – if your expenses are less than your net income, this presents a great opportunity to set aside more money for your financial goals.
Adjust as necessary – if your expenses exceed your net income, then you need to adjust your discretionary spending to see where you can reduce costs.
Identify roadblocks – identifying expenses allows you to better understand where you are spending your money. This will help you identify where your financial roadblocks are.
Don’t forget about your taxes – Did you buy a house recently? Have you started college courses? You may have deductions waiting for you at tax time that can help your budget. But don’t underestimate the potential for having to pay the IRS if your tax calculations didn’t include a crucial deduction or one that was permitted in years past but no longer.
Situational expenses count – Did you have to move this year? Did you get a Permanent Change of Station orders and relocate to a new base? Was your home damaged in a natural disaster? Don’t overlook such issues when it comes to your budget. It may be wise to start a contingency fund to handle unexpected costs along the way.

Step 3 – Identify Your Goals and Make Adjustments

Have a goal – having a goal behind your budget will help it succeed by increasing motivation. Review the areas where you spend money and see if they align with your new goals. You might need to eliminate or reduce some expenses if they don’t.

Examples of goals would be paying off debt, saving for retirement, paying off college, building a savings account, saving for a vacation, and saving for a down payment.

50/30/20 Rule – if you are just starting with budgeting and not sure of how much money you need to accomplish your goals but want an easy starting point, start with the 50/30/20 rule.

50% of your income should be spent on essentials, 30% should be spent on discretionary spending, and 20% for savings and investing.

Remember variable expenses like food and gas – variable expenses can be tricky to budget for, especially food. When budgeting for food, find a dollar amount per person per day that seems reasonable.

Another variable expense that gets people is fuel. Review your last few months of fuel costs and use the average amount as your monthly budgeted cost. It pays to overestimate these costs a bit if you can. It’s better to earmark a bit more upfront in your budget than to be caught short.

After completing these steps, you may be ready to set up and start your new budget. If not, you can always get financial advice from Department of Defense resources. Once you have set a budget, it’s important to review it every few months; your goals and resources can change.

01 Mar 2301 Mar 23

Troops Discharged for Refusing Vaccine May Be Allowed to Rejoin

Approximately 8 thousand troops were discharged during the Coronavirus pandemic because they refused to get a COVID-19 vaccination. In the wake of congressional testimony by the Senior Enlisted Advisors of each branch of the service in late February 2023, many of these troops may be allowed to rejoin their branch of service.

According to some accounts, many discharged for refusing the vaccine want to return. A path to rejoining is possible, but there are some caveats.

One of those caveats? You must have been discharged ONLY for refusing the vaccine. All applications to rejoin are handled on a case-by-case basis.

Background

In 2021, the Secretary of Defense issued a Memorandum for Senior Pentagon Leadership, acknowledging, “Mandatory vaccinations are familiar to all of our Service members, and mission-critical inoculation is almost as old as the U.S. military itself.”

And with that, the Secretary of Defense directed in writing, “the Secretaries of the Military Departments to immediately begin full vaccination of all Armed Forces members under DoD authority on active duty or in the Ready Reserve, including the National Guard, who are not fully vaccinated against COVID-19.”

But some service members refused to obey the order to receive the vaccination. These service members were discharged from military service for that refusal, like those who refused the anthrax vaccine in the 1990s and early 2000s.

Related: Involuntary Separation Pay

Ending the DoD COVID-19 Vaccine Mandate

The James M. lnhofe National Defense Authorization Act for 2023 rescinds the 2021 mandates that all troops be vaccinated against COVID. This also means all “DoD Component policies, directives, and guidance implementing those vaccination mandates” no longer apply as of January 10, 2023.

In February of 2023, using the same Memorandum for Senior Pentagon Leadership format that announced the DoD mandatory COVID-19 vaccination policy had ended, with certain exceptions.

Military members are no longer automatically required to be vaccinated against COVID-19 but must comply with any host nation’s requirements for these vaccinations when serving overseas.

But none of this explains how troops discharged for refusing the vaccine can rejoin. That required senior leadership from each branch of military service to create policies to facilitate allowing these troops to return.

Rejoining the Military After Refusing the COVID-19 Vaccine

The Secretary of Defense issued a memorandum directing all branches of service to rescind COVID-19 vaccination policies. Part of that directive involves addressing issues related to those denied reenlistment or forced out of military service due to COVID-19 vaccine refusal.

Those who wish to rejoin after being separated for vaccine refusal must show that their separation was caused solely by refusing the vaccine.

Those whose service records reflect this may be allowed to rejoin the service as a prior service member. This means working with a Prior Service Recruiter who will have to perform a records review to ensure the service member wasn’t discharged for other reasons as well.

Rejoining the military after being discharged for COVID vaccine refusal means returning to active duty with a “break in service.” But it also means removing all negative actions against a service member for refusing the shots.

No COVID-related “adverse actions” against a servicemember will survive or persist in those troops’ military records.

If you cannot locate a prior service recruiter in your local area, go to the official site for the branch of service you wish to rejoin and search the site for “prior service recruiting”.

Those who wish to rejoin the service but through a different branch (Army to Navy, Navy to Air Force, etc.) should contact that branch of service’s prior recruiting department.

02 Feb 2301 Mar 23

Involuntary Separation Pay

If you are a service member facing involuntary separation from the military, you may be entitled to separation pay if you meet time in service requirements and other rules. Why is separation pay necessary, and who does it affect?

Who Is Eligible for Involuntary Separation Pay?

For this article, we’re discussing the type of separation pay offered as a lump sum to active duy and Reserve members who are either involuntarily separated or denied reenlistment before reaching enough time in service to earn a military retirement.

Specifically, this applies to those who have a minimum of six but fewer than twenty years of active service. This is often referred to as Involuntary Separation Pay or ISP.

Why Are Service Members Involuntarily Separated?

There are a number of factors that may make you eligible for ISP. The government may deny your reenlistment due to failure to earn a promotion within a specific time. You may be involuntarily separated because of a federal Reduction in Force (RIF), a drawdown, or other factors.

Some are involuntarily separated due to medical issues, and some are separated because personal circumstances warrant (hardship discharges). Not all involuntary separations are punitive, and not all qualify for ISP.

Qualifying for Separation Pay

To qualify for ISP, the following must apply:

The service member received an involuntary separation.
That separation is Honorable or General (Under Honorable Conditions).
The service member agrees to a three-year term of service in the Ready Reserve (Selected Reserve or Individual Ready Reserve) following discharge or release from active duty or active service (AD/AS).
This requirement is “in addition to any other service obligation of the Service member,” according to the DoD.

Other considerations may also apply depending on the branch of military service, changes in federal policy, or other variables.

Those who are involuntarily separated and paid ISP but later qualify for military retirement pay or military disability retirement pay may have that pay reduced “until the total amount deducted is equal to the total amount of ISP received,” according to the DoD, which adds there are no waivers for this rule.

How Involuntary Separation Pay Is Calculated

The DoD calculates “full ISP” at “10 percent of the product of the number of years of active service and 12 times the monthly basic pay to which the Service member was entitled at the time of discharge or release from AD/AS” according to Defense.gov. Half ISP is 50% of the calculated amount of full separation pay.

Who Is Eligible for Full ISP?

To qualify, all the below must apply:

The Service member has completed at least 6 years but fewer than 20 years of active service. Reserve Service members may qualify with 6 years of continuous active service, which “must have preceded immediately before separation,” according to Defense.gov.
The Service member is involuntarily separated through “denial of reenlistment,” or “denial of continuation on active duty” or in active service status.
The Service member agrees in writing to serve in the Ready Reserve for 3 years following the separation from active service.

Half ISP Eligibility

Half payment of non-disability ISP is permitted under similar circumstances with added considerations, including the nature of the separation. Half ISP may be paid when the service member is “deemed not fully qualified” for reenlistment.

This can include circumstances where the separation is due to a variety of issues described by Defense.gov. The following list is in the DoD’s terminology, not ours::

Weight control failures
Family care plan deficiencies
Security clearance issues
Mental/physical conditions that do not constitute a disability
Alcohol or drug abuse rehabilitation failure

Restrictions on ISP Eligibility

Some circumstances do NOT qualify for any level of ISP. They include when the service member initiates separation and situations where the member does not agree to a Reserve service commitment (see above) at separation. Other restrictions include no ISP for those who:

have not finished an Initial Term of Enlistment or an Initial Period of Obligated Service
are released from duty for training purposes;
collect or are eligible to collect retirement pay or retainer pay;
received a punitive discharge
Were separated via a service-specific program featuring a “no payment” level

If you need more information on qualifying for Involuntary Separation Pay, contact your base finance office, unit orderly room, Command First Sergeant, or Detailer.

25 Jan 2323 Feb 23

Billion-Dollar PCS Reform For Military Household Goods Moves

PCS reform to the tune of more than $6 billion was approved after a four-year struggle to place all military permanent-change-of-station (PCS) household goods moves under a single contract.

PCS moves require the military to use a contractor to pack, ship and deliver household goods for military members leaving one assignment for another whether stateside or overseas.

Why PCS Reform Was Necessary

Military members have commonly experienced unnecessary delays, damaged household goods, lost or stolen household goods, and poor customer service from contractors. Under the old system, there was inadequate centralization or standardization to rely upon. PCS reform seeks to change that.

How long will it take? The new system is likely to become fully operational for the 2024 PCS season which typically runs between May and September.

“Peak PCS season” simply means that is when most military members get orders to relocate. PCS moves outside that window are possible, but the majority of them take place during the peak season.

Learn more: 10 Best PCS Benefits for Military Families

What Does PCS Reform Mean?

PCS reform means putting all PCS moves under a single contractor, a program called the Global Household Goods Contract. This was awarded to a company known as HomeSafe Alliance.

The contract was approved, the transition was scheduled and U.S. Transportation Command has gone on the record saying the new contractor’s operations would be phased in until the 2024 PCS season when the new contractor was scheduled to take over completely.

Details of the Reform

The Global Household Goods Contract is worth some $6.2 billion and is effective for over three years. How does the new contract work? It outsources the management of PCS moves under a single contract. U.S. Transportation Command or TRANSCOM oversees the contract, which is said to be the first of its kind associated with PCS move reform.

The contractor, HomeSafe Alliance, is tasked with assembling a network of moving companies and other moving service providers such as storage, transportation, and delivery. There are well above 300 thousand household goods shipments a year, costing more than $2 billion.

Transparent to the Consumer?

At press time, there are no promises that the new PCS contract or transition to that contract will be 100% transparent or seamless to the consumer. There may be issues along the way, and military members or families that experience trouble with their PCS move should take the following steps:

Fully document the issue. Take photos of any damage, where applicable. Make notes of dates and times of relevant incidents, especially where missed appointments, poor customer service, or other issues are evident.
Follow any claims procedures given to you by the contractor to the letter.
Report any problems to the losing or the gaining base Travel Management Office (TMO) or equivalent immediately and request assistance. If your problem occurs before departure, contact the losing base TMO, if the issue is on the other side of the move, contact the gaining base TMO.
Inform your chain of command via your command support staff if you have issues that are not resolved satisfactorily. You may need to elevate some issues through the chain of command or through other appropriate channels, especially if there are issues with broken customs seals on your household goods containers.

19 Jan 2301 Mar 23

Do I Need A Veteran ID Card?

Am I Required to Carry a Veteran ID Card?

When you retire or separate from the military, one of the requirements is that you either surrender or no longer use your active duty, Guard, or Reserve military ID card.

Since a military ID is used to gain access to military bases and other facilities open to service members but not the general public, having a specific expiration date on these cards is necessary to prevent unauthorized access.

Why would you need a veteran ID card? In some cases, it’s as simple as being able to prove affiliation with the military for discounts, perks, or other special options offered to those who serve. In others, some form of veteran ID may be required to access VA services, benefits, etc.

There are many types of cards considered “veteran ID cards” but one is specifically named as such. What is the difference? We’ll explore that below.

Do all Veterans Have Military ID?

As mentioned above, there are many forms of veteran ID so it’s possible to have one or more types. But for official purposes (VA clinic visits, base access, etc.) you will need specific types of ID.

A military retiree is issued an ID card that provides them access to the services and locations open to retirees. Veterans who did not retire aren’t allowed the same access on base or on-post, and the ID cards they do carry don’t guarantee access to all services or areas.

How do I get Proof of Being a Veteran?

The most important type of proof isn’t an ID card, but your military discharge document such as a DD Form 214 or its equivalent. This document is needed to request other forms of veteran ID like a state ID or driver’s license that has a veteran designation on it.

>>Military benefits for veterans and retirees

Types of Veteran ID cards

The cards described below are a combination of cards that you need to access services and bases, and the types of cards you use to access discounts and other veteran perks.

Department of Defense Identification Card

A Department of Defense (DoD) Identification Card is proof of your current military status, whether that is as an active duty member, retiree, or another category.

This card is offered to veterans including those who receive “retainer pay” and those who are VA rated with a 100% service-connected disability. Having this card offers access to programs and services you cannot obtain without one. You may be able to use this card as an ID for some TRICARE services, depending on the circumstances.

VA.gov offers a list of those eligible to apply for this card:

Military retirees
Those on active duty
National Guard members
Reservists
Members of the Inactive Ready Reserve

Veteran Health Identification Card (VHIC)

Veterans who enroll in VA health care are offered a Veteran Health Identification Card (VHIC) which is used to check in to VA medical appointments with, as a form of veteran ID to get discounts and special offers, or as a backup ID when requesting veteran-specific services or options like a veteran-designated license plate.

You cannot get this card without being enrolled in the VA healthcare system. You can use the AccessVA portal to make your request, which must be accessed via Login.gov, ID.me, DS Logon, My HealtheVet, or Department of Defense Common Access Card (CAC) accounts. When submitting online, be sure to have digital copies of all required documents.

Veteran ID Card (VIC)

VA.gov describes the Veteran ID Card as a “digital photo ID you can use to get discounts for Veterans at many stores, businesses, and restaurants.” This card is not typically used for access to VA services or military bases, and is issued by the Department of Veterans Affairs. To qualify, both of these must apply:

You served on active duty, as a Reservist, in the National Guard, or the Coast Guard and
You received an honorable or general discharge under honorable conditions

Apply for a Veteran ID Card online using ID.me, Login.gov, or MyHealtheVet.

Veteran Designation on State-Issued Driver’s Licenses and State IDs

Va.gov reports that all 50 states and Puerto Rico offer licenses and state ID cards featuring veteran designations. Application procedures and general requirements will vary from state to state, but in general expect to bring proof of military service, discharge paperwork, and documents that prove state residency.

21 Dec 2222 Feb 23

2023 Military Benefits Changes & Updates

Military Benefits Updates and Changes for 2023

Military benefits are updated for 2023 as of the first day of the new year. BAS, BAH, COLA, and other rates are subject to change from year to year. Here are the rates and information for 2023.

Military Pay Raise in 2023

A 4.6% pay raise is in the 2023 National Defense Authorization Act. It is the largest basic pay increase since 2001, and rising costs/inflation are factors in the 2023 numbers.

This pay raise may not be enough to help some military families keep up with rising food and housing costs.

New Basic Needs Allowance in 2023

The Basic Needs Allowance was created for active-duty service members with dependents who fall below federal poverty guidelines.

This allowance is considered taxable supplemental income and is offered to those who have completed basic training, meet income requirements, and apply for the program.

While DoD literature says the military services will begin screening military members who may qualify, to claim this allowance, you must formally apply.

Where to Apply for the Basic Needs Allowance

This application process is service-level which means your branch of military service will determine how the eligibility screening and application process will work. Contact your unit orderly room or command support staff to learn how to apply for this benefit should you qualify.

How Much is the Basic Needs Allowance?

- The amount of the Basic Needs Allowance is not standardized.
- Instead, this supplemental pay is calculated to bring the service member’s gross household income up to an acceptable-to-DoD percentage of Federal Poverty Guidelines which vary according to household size and location in the United States, Alaska, and Hawaii.
- That percentage was once listed at 130% but may be subject to revision as a result of certain provisions in the 2023 NDAA.

BAH 2023 Rates

BAH is the Basic Allowance for Housing. BAH is based on your rank, dependent status, and geographic location. BAH is intended to cover 95% of your housing costs, and BAH is paid according to your duty station zip code.

The 2023 Basic Allowance for Housing rates increases by an average of 12.1 percent. That is according to the DoD, which notes, “The significant increase in average BAH rates is reflective of the unique market conditions experienced across many locations nationwide over the past year.”

When Does the New BAH Begin?

New BAH rates typically go into effect on January 1st with the changes reflected in the January 15th paycheck.

However, when using these rates for the GI Bill, the housing allowance is updated in September. Use the rates listed by the Department of Veterans Affairs for the Post-9/11 GI Bill to accurately calculate your potential BAH benefit in any given zip code.

You can calculate your BAH at the Defense Travel Management Office’s official site. When looking up BAH rates for the GI Bill, remember that the rate is paid at the equivalent of an E5 at the with-dependent rate for that zip code.

Higher COLA in 2023

There will be an 8.7% cost of living increase in 2023. That is a significant big step up from the past two COLA increases. Military retirees, those who receive VA disability pay, federal retirees, and Social Security recipients all get an 8.7% COLA increase in 2023.

For 2023, retired military members may see an additional $87 per each $1000 of retirement pay.

That sum may be different for those who opted into a military retirement plan called CSB/REDUX offered starting in 1986. These retirees have a smaller Cost of Living Adjustment worth approximately $77 per $1000 when the new COLA payments begin in 2023.

BAS 2023 Rates

The monthly Basic Allowance for Subsistence (BAS) rates for 2023 are as follows:

Officers: $311.68
Enlisted: $452.56

Other Military Benefits Coming in 2023

The 2023 National Defense Authorization Act provides some additional new benefits in 2023, including but not limited to the following:

Military Pay and Allowance Benefits:

- In 2023, a servicemember whose sole dependent dies will “continue to receive Basic Allowance for Housing at the “with dependents” rate for a period up to 365 days after the death of the dependent.
- 2023 brings increased maximum amounts for bonuses and special pay in critical career fields.
- There is also more compensation related to military spouse relicensing and business costs arising from a permanent change of station move.

Military Healthcare, Education, and Childcare Benefits Changes in 2023

- The DoD provides “transitional health care benefits to members of the National Guard who are separated from full-time duty, called or ordered by the President or the Secretary of Defense” for 30 days or longer in response to a national emergency declaration.
- The NDAA provides up to $20 million for a pilot program designed to promote “the hiring of special education inclusion coordinators in DOD Child Development Centers to provide additional specialized care for special needs dependents.”
- In 2023 DoD extends a pilot program to expand enrollment eligibility at CONUS elementary and secondary schools.

TRICARE Benefits in 2023

Some newcomers to TRICARE may be confused (at first) by TRICARE’s Group A and Group B options.

Group A is for those who signed up before 2018.
Group B is for those who signed up on or after Jan. 1, 2018

Knowing whether you are Group A or Group B will help you better understand the information below.

TRICARE Prime Costs for 2023

This section covers:

TRICARE Prime
TRICARE Prime Overseas
TRICARE Prime Remote
TRICARE Prime Remote Overseas,
US Family Health Plan (USFHP)
TRICARE Young Adult Prime plans

There are no annual enrollment fees for active duty service members, active duty family members, and qualifying surviving spouses/children.For retirees, their families, and “most others”:

Group A: $351.96 per individual/$703.92 per family
Group B: $426 per individual/$852 per family

Covered services for TRICARE Prime Group A and Group B feature no out-of-pocket expenses for active duty service members and families. For retirees and others, Group A and Group B:

Preventive Care Visit $0
Primary Care Outpatient Visit $24
Specialty Care Outpatient Visit $36
Urgent Care Center Visit $36
Emergency Room Visit $73
Inpatient Admission, Network $182

The TRICARE official site advises that when using a TRICARE-authorized provider other than your primary care manager for nonemergency services without a referral, you pay:

An annual deductible before TRICARE cost-sharing begins. This deductible is $300 per person and /$600 per family.
For TRICARE services beyond the deductible, the patient pays half the TRICARE-allowable charge.
TRICARE does not apply these charges to the catastrophic cap.

TRICARE Select Costs 2023

This section covers:

TRICARE Select
TRICARE Select Overseas
TRICARE Reserve Select
TRICARE Retired Reserve
TRICARE Young Adult Select
Continued Health Care Benefit Program

There is no annual enrollment fee for active duty. For retirees, families, and others who may qualify under this section:

Group A: $171.96 per individual/$345 per family
Group B: $547.92 per individual/$1,095.96 per family

You must spend your annual deductible amount before TRICARE cost-sharing begins, according to TRICARE.mil.

TRICARE Select Deductibles E4s and Below for TRICARE Select

Group A individuals and families TRICARE Deductible equals $50 and $100, respectively. The annual deductible for Group B and TRS members and family members equals $60 and $121, respectively.

TRICARE Select Deductibles E5s and Above for TRICARE Select

Group A individuals and family member deductibles equal $150 and $300, respectively. Group B and TRS individuals and family member deductibles equal $182 and $365, respectively.

TRICARE Select Deductibles for Retirees, Families, TRR members, and Others

TRICARE Group A individual and family member deductibles for 2023 equal $150 and $300, respectively.
Group B in-network=$182
TRS members in-network=$365
Out-of-network the fees are $365 and $730, respectively.

TRICARE Premium-Based Plans

Those who have enrolled in TRICARE premium-based plans in 2023 will pay the following fees as applicable, either monthly or quarterly.

Continued Health Care Benefit Program: Member only=$1,654 Member and family=$4,134. This is paid on a quarterly basis. The following are all monthly plans:

TRICARE Reserve Select: Member only=$48.47 Member and family=$239.69
TRICARE Retired Reserve: Member only=$549.35 Member and family=$1,320.76
TRICARE Young Adult Prime: Individual coverage offered at $570
TRICARE Young Adult Select: Individual coverage offered at $291

TRICARE Catastrophic Cap in 2023

The catastrophic cap is the maximum amount those enrolled in TRICARE pay out of pocket for covered TRICARE health care services in a given year, excluding fees/premiums where applicable.

When reviewing the information below, know that TRICARE Young Adult catastrophic caps are based on the sponsor’s status but are listed in Group B. The Continued Health Care Benefit Program catastrophic cap also follows Group B.

Active duty family members in Group A: $1,000 per family
Active duty family members in Group B $1,217 per family
Retirees, families, and others in Group A: $3,000/family (Prime) $4,028/family (Select)
Retirees, families, and others in Group B: $4,262/family
TRS members (Group A or Group B): $1,217/family
TRR members (Group A or B): $4262/family

TRICARE Pharmacy Costs in 2023

Active duty military members and families have no costs for military pharmacy needs, though for overseas prescriptions, you may be required to pay first and be reimbursed by TRICARE later.

TRICARE Pharmacy home delivery costs and retail network pharmacy costs in 2023 may range from $12 to $68, depending on the circumstances.
Using a non-network pharmacy in 2023 may require a 50% cost share for TRICARE Prime.
“All other beneficiaries” pay either $38 or 20% of the total cost of the prescription after the deductible has been paid.

23 Nov 2224 Feb 23

2023 National Defense Budget: More Money For Troops

The National Defense Authorization Act is the legal basis for funding the Department of Defense. It specifies a budget for the entire DoD, authorizes pay raises and acquisition programs, and much more.

Everyone in uniform is affected by the NDAA, as well as their immediate families. Each year, the NDAA must be passed by the House and Senate, and signed into law by the President.

The 2023 National Defense Budget, also known as the 2023 NDAA, cleared the House of Representatives in July 2022 and at press time awaits approval by the Senate and a signature from the President. What follows is based on the version of the NDAA which was approved by the House.

The Senate version may remove or modify some or all of the following options discussed below.

2023 National Defense Authorization Act: More Money For Troops And Families

A key part of the NDAA for any fiscal year? Military pay raises. The 2023 pay raise in the current NDAA calls for a 4.6% increase in military pay.

Compare that proposed increase to last year’s approved pay raise of 2.7%. For an E-5 with six years time-in-service, the 2023 pay raise could be worth an extra $150 every month.

Some sources point out that while this pay increase looks impressive, it may not be enough to catch up with which is at nearly 8% for 2022. That’s where DoD officials hope an inflation bonus added to the 2023 NDAA might help.
There is a proposed short-term pay bonus in the 2023 NDAA that would be applied to those earning less than $45 thousand per year in base pay.
It works out to be a minimum of 2.4% of that base pay, but the catch is that this increase is (under the current version of the NDAA) only for the year 2023.

Higher Bonuses Proposed

The military’s secret weapon when it comes to recruiting and retention? The enlistment bonus and the reenlistment bonus.

High-demand career fields such as intel, nuclear operations, and military medicine all potentially offer these bonuses. The 2023 NDAA features higher amounts:

Enlistment bonuses which previously featured maximums of $50k, for example, would be increased to $75k in the new year.
Re-enlistment bonuses may also go up to $50k (from the previous $30k).
Those who qualify for proficiency pay bonuses or other incentive pay may find their maximums go up from $1000 to $1750.

Extensions to Temporary Authorization to Increase BAH

A temporary authorization to increase rates for Basic Allowance for Housing in 2022 (associated with inflation and rising housing cost) has been inserted into the 2023 NDAA as an extension of the original.

This could, if approved, mean more BAH money for troops living in areas where housing costs rise above a certain percentage.

Extensions To Guard/Reserve Incentive Pay

Some Guard and Reserve incentive pay options originally set to expire at the end of 2022 are being extended into 2023.

This affects skilled duty such as medicine or nuclear operations, but also affects incentive pay offered to “reserve component members experiencing extended and frequent mobilization for active duty service”.

Cold Weather Operations Pay or Arctic Pay

Troops assigned to cold weather bases, or who must train in frequent cold weather may be eligible to draw so-called Arctic Pay or cold weather operations pay. The 2023 NDAA authorizes a special pay that could be worth $300 extra per month. However, under the current version of the NDAA, this option is only permitted for the year 2023.

WhistleBlower Incentives

Some NDAA initiatives don’t survive revisions in the Senate. Each year many options are named with some making the cut and some being left “on the cutting room floor”. A proposed whistleblower incentive is one of those “iffy” measures that may or may not survive the next version of the act.

The 2023 NDAA features a provision to pay up to $10 thousand or one percent of the savings realized as the result of servicemembers lodging whistleblower-type complaints about fraud, waste, and abuse in DoD operations.
A similar program is already in effect, known as the DoD Suggestion Program, which is not specifically targeted at whistleblowing but does offer cash incentives for suggestions that are actually put into use and realize savings.

Pet Relocation

Another provision that may or may not make the cut is the allowance for pet relocation associated with a permanent change of station move. The DoD may reimburse you for up to $2,000 in charges associated with relocating a pet as part of a PCS move.

What to Know About the 2023 NDAA

The 2023 National Defense Authorization Act is some 3853 pages long and contains literally hundreds of provisions. At press time this has been placed on the Senate calendar but the NDAA has not made its way through the Senate approval process nor has it been sent to the President’s desk for signature. The previous version was approved by the Senate in late December 2021.

2023 Military Benefits Changes and Updates

18 Oct 2231 Oct 22

Largest Retiree & Veteran COLA Increase In Decades Approved

A major increase in the federal Cost of Living Allowance (COLA) is coming in 2023. The Social Security Administration adjusts government retirement and disability payments each year to account for increases in the cost of living due to inflation. That means both civilian and military retirement and disability pay, so veterans are due for the biggest increase in their checks since the 1980s. Other payments affected by this increase include Social Security.

Who Else Benefits from COLA Increases In 2023?

Military retirees and VA beneficiaries will enjoy higher COLA in 2023 along with Social Security beneficiaries and Civil Service retirees. For both there could be as much as $140 per month in COLA in typical cases.

COLA Increases for Retirees and Veterans by the Numbers

Those who draw military retirement pay or VA compensation for service-connected medical conditions will see their monthly payments increase by 8.7% in 2023. The increase is meant to offset inflation, and it’s the largest increase since 1981 when the COLA increase topped 11%.

How significant is the COLA increase? Compared to the last two years, you can see for yourself:

2021 COLA Increase: 1.3%
2022 COLA Increase: 5.9%

Annually, the increase averages out to 1.9% over the last decade.

What Does the COLA Increase Mean In Dollars and Cents?

For 2023, retired military members may collect an additional $87 per each $1000 of retirement pay for a given month. But not all retirees and veterans drawing disability pay will see the same increases. Why?

Some entered the military in an era when a retirement program called CSB/REDUX was an option. Those who opted into this program (offered from 1986 onward) will have a smaller COLA increase as part of that plan. These veterans will get $77 per $1000 when the new COLA payments begin in 2023.

Retirement Pay / VA Disability Pay Offset Issues

Military retirees who have VA disability ratings may have choices to make when it comes to cost-of-living adjustments. A veteran who draws both VA disability compensation (at 40% or lower) and military retirement pay can only get ONE cost of living adjustment, which is applied to either the disability pay or retirement monthly payment.

The thing making it harder to choose which to apply COLA to? Retirement pay is taxable, but VA disability pay is not. Deciding which to apply the cost of living adjustment is a personal matter, but it pays to compare the numbers before making a decision.

VA Disability Pay COLA Increases

Disabled veterans will see higher COLA payments in 2023, but the numbers aren’t as impressive as for retirement pay. The same percentages apply; an 8.7% increase in pay means someone with a VA disability rating at 10% will see their checks increase by roughly $13 per month for a 10% disability rating. Those rated at 100% disabled will see a COLA increase of approximately $289 per month.

How Are COLA Adjustments Calculated?

The annual Cost Of Living Adjustment is calculated using something called the Consumer Price Index which measures the cost of living including what it currently takes to purchase goods. This information is compared to the same data gathered the year prior and if there is an increase in those costs, COLA goes up. COLA cannot be revised downward. In years where there is an actual decrease in the cost of goods and services, there simply is no COLA adjustment.

11 Oct 2228 Feb 23

Military Benefits Guide: Active Duty

Joining the United States Military as a soldier, sailor, airman, Marine, Coast Guard member, or Space Force Guardian means accepting a commission or taking an oath of enlistment. The oath describes the new servicemember’s obligations to support and defend the Constitution of the United States against all enemies, foreign and domestic.

But after the oath, these new troops learn about the benefits they have earned by taking the oath. What ARE the benefits of joining a branch of the uniformed services?

How do they differ depending on your status as an active duty service member, National Guard, or Reserve component? Do military spouses and dependent children get benefits too? In some cases, the answer is definitely yes. In other cases, the benefits may have qualifying requirements.

Below, we’ll explore military benefits for all eligible applicants below, starting with active duty, Guard and Reserve, and finishing with information for spouses, dependents, and others who may qualify.

Military Benefits for Active Duty Personnel

Military benefits start with pay and allowances but also include healthcare, education, medical care, travel, free tax support, and home loans. Some benefits begin immediately, others require minimum time in service.

Some benefits cannot be accessed until the service member has completed Basic Training and any advanced training required before getting a first duty station assignment.

Military Benefits During Basic Training

When you enlist or accept a commission, some benefits are open to you right away. Military pay begins when you begin your initial training, and so do medical benefits in the form of on-base care from a military facility. All new recruits are automatically covered by TRICARE health insurance when they ship out to basic training.

What you do not get right away includes the GI Bill, the VA home loan, spouse tuition assistance, access to on-base child care, military leave, Space-A travel, and special pay/allowances like hazardous duty pay and proficiency pay.

Military Allowances

Depending on your duty station, the nature of the duty, your branch of service, and other variables you may be offered a range of military allowances to offset certain costs associated with relocating to and working at a new assignment, deployment, TDY, etc. These allowances may include:

Basic Allowance For Subsistence
Housing allowance (overseas and stateside)
Other “situational” allowances (Cost of Living, Family Separation)
Clothing allowances

Most of these allowances must either be approved by your chain of command or you must apply to begin the approval process. The branch of military service, the type of allowance you need, and your rank will all play a factor in determining how much you are entitled to and when.

There are also many other special pay and allowance options that may be offered to you depending on your rank, your career field, and other variables. Many of these must be qualified for through specific service, testing (language proficiency testing is one of those), and experience.

Others may be offered by virtue of being assigned to a certain location (hazardous duty pay is one of those) or because a career field is understaffed and needs retention incentives.

“Situational” Military Allowances

Some military allowances are offered if the military decides you need them in specific circumstances. For example, a Cost of Living Allowance (also known as COLA) supplements basic pay in areas overseas where the cost of living is higher. Overseas assignments like Japan, for example, have traditionally featured COLA to make being stationed there more affordable.

Another situational allowance is FSA, also known as the Family Separation Allowance. This is paid to those who must perform duty away from their family.

This allowance is paid for those who are involuntarily assigned away from home and is not offered for those who volunteer to serve elsewhere. Situational allowances (our term, not the DoD’s) are paid when the service member meets the required conditions and is no longer paid when those conditions are no longer met.

Military Housing & Housing Allowances

Some will qualify for a Basic Allowance for Housing stateside or an Overseas Housing Allowance. What does it take to be approved for these housing allowances? Sometimes, it’s a simple matter of being assigned to a new base and not being given government quarters. In others, it may be a case of deciding which option works best for you. But what about those offered government quarters as single or married service members?

Some military members may qualify for on-base military housing. Some are offered this as single/unaccompanied service members, others are offered military family housing designed for legally married couples and any dependent children.

You may be offered on-post housing run by the DoD (getting rarer all the time) or you may be offered housing on base or off run by a public/private venture agreement between the federal government and a private housing provider.

If you draw BAH and live off base, you may or may not have the option to choose on-post housing later. Much depends on the assignment you’re at and the available on-base units at the time.

Single and unaccompanied service members who are not offered BAH are usually housed in “the barracks”, which in today’s sense are more like college dorm rooms (depending on the location, housing conditions, and quality in these facilities can vary greatly) than what you might envision a barracks environment to be like. Your options may include:

Government-owned on-base housing
Privatized on-base housing
Single or unaccompanied quarters

VA Home Loans

The VA Home Loan benefit is offered to those who serve a minimum amount of time in uniform after completing initial training. VA loans typically require a minimum of 90 days of continuous active duty service but if you joined in an earlier “service era” than the current Gulf War era, your time in service minimums may vary.

Basic Allowance For Subsistence (BAS)

What is the military’s Basic Allowance for Subsistence, informally known as a Subsistence Allowance or BAS? This is a tax-exempt military allowance designed to offset the cost of a service member’s meals. BAS, also known amongst some service members as “separate rations” or more derisively as “separate rats”, is a callback to the days of old when the United States Military and other military forces offered both room and board for its troops.

BAS is offered when the federal government declares that an assignment or duty location warrants the allowance due to a variety of factors which can include the availability of kitchen facilities for service members to use, the cost of food or food-related expenses for the service member, and whether or not the command feels it’s practical or necessary to provide BAS.

BAS Is For Service Members Only

BAS is offered to the servicemember only. Family members (spouses included) do not qualify for BAS as this is an allowance designed to offset any associated food costs with a new duty station, deployment, duty-related travel, etc.

BAS is based on the most current food cost estimates made by the federal government via the USDA Food Cost Index, and the rate of payment is based on your status as an officer or enlisted member.

BAS is one of the rare cases where military pay and allowances are actually higher for enlisted members. Officer pay is considerably higher than enlisted pay; officers are thought to be better able to afford their day-to-day living expenses as a result. That is why enlisted members get more food dollars. Like most military allowances, BAS is subject to annual adjustments based on the anticipated increases in food costs from year to year. But the BAS increase you get is not tied to the same factors used to determine yearly military pay raises; these are separate processes.

GI Bill

The GI Bill is one of the most important and most-used military benefits. This option is open to currently serving, retired or separated, Guard and Reserve members, and even some dependents. GI Bill options for active duty service members include the ability to transfer the GI Bill to a spouse or school-age dependent child.

You are required to serve a minimum time in uniform before you can apply for GI Bill education benefits. For those on active duty today, the minimum is typically 90 days, which may vary depending on when you joined the military.

The GI Bill pays participating schools tuition, fees, and other expenses. You may find the entire cost of your basic education is covered in some cases. In others, you may need supplemental assistance from options like the Yellow Ribbon Program, state veteran education resources, etc.

Read More: The Yellow Ribbon Program and how it can enhance your GI Bill.

Not all GI Bill options are the same. If you signed up for the Montgomery GI Bill, for example, you do not have the option to transfer your benefits to a spouse or school-age dependent. If you signed up for the Post 9/11 GI Bill you may have the option to do so but there may be an added service commitment required in exchange. Some may be offered the opportunity to switch from the Montgomery GI Bill to the Post 9/11 version. Once you make the switch, it is irreversible.

There were many changes to the GI Bill thanks to a piece of legislation known as the Forever GI Bill, which is a law and not a separate, new GI Bill option all by itself. The Forever GI Bill changes the way benefits may be transferred and used, how Post 9/11 GI Bill housing stipends are paid, and more.

There are GI Bill options for members of the Guard and Reserve, and the requirements for these troops differ from those on active duty. It’s good to know your options long before you want to use them as a member of a Reserve component.

Military Education Benefits

Branch-specific tuition assistance programs and on-base education options include:

Air Force Tuition Assistance
Army Tuition Assistance
Navy Tuition Assistance
Marines Tuition Assistance
Coast Guard Tuition Assistance
National Guard Tuition Assistance
Reserve Tuition Assistance

These programs are offered to those who meet minimum time-in-service requirements and other criteria. For example, the Air Force paid 100 percent of tuition, up to $250 per semester hour, and $166 per quarter hour for accredited off-duty courses.

The rules for each Tuition Assistance program will vary depending on the branch of service. Some military tuition programs specify that only one degree per degree level (undergraduate, graduate, etc.) may be funded.

All military tuition assistance programs have minimum grade point average requirements and those who fail to maintain satisfactory progress may be required to pay back some or all tuition assistance depending on circumstances. This type of assistance may not be offered to troops with disciplinary issues, failed fitness tests, or other problems.

Education Benefits For Disabled Veterans

There are also military education benefits offered specifically to help disabled veterans, and some benefits are offered to both those still serving as well as those who have retired or separated.

These are typically offered at the state and local levels. You may find that these programs are administered in some cases by veteran service organizations and in others by a state government agency such as a state-level Division of Veterans Affairs or Department of Veterans Affairs (not the federal agency).

The features, qualifications, and application requirements of these programs are NOT standardized and will vary depending on the state, the agency, and other factors. In some programs, it may be the veteran and/or dependents who benefit, in others, it may be the veteran only, or the spouse alone. In others benefits may be offered only to dependent children of qualifying service members.

Healthcare

The basic rule of thumb for military healthcare: those currently serving on active duty enroll in TRICARE for health coverage for themselves and immediate family members. In general, active duty service members and their families do not receive care from the Department of Veterans Affairs, though some service members are encouraged to begin working with the VA as soon as they have obtained retirement or separation orders.

Active duty members and their families may be treated at an on-base medical facility or an off-base facility that is within the service member’s TRICARE network. Overseas your options may be more dependent on the on-post treatment options provided, but this is not necessarily true in all cases. Much depends on where you are stationed, for how long, and the nature of your assignment.

TRICARE
On-base medical care is an option for servicemembers and their families.

There are a variety of TRICARE options including:

TRICARE Prime
TRICARE Select
TRICARE Prime Overseas
TRICARE Select Overseas

TRICARE may be an option for some qualifying military retirees. Those who are retired or separated have the option of applying for VA healthcare options which may depend on the applicant’s medical condition, any VA-rated service-connected medical issues, and more. When you are an active duty military member transitioning out of military service you may have the option to get temporary TRICARE coverage when separating, dependent care included.

Life Insurance (SGLI)

If you are currently serving, you are eligible to apply for Servicemembers Group Life Insurance or SGLI. This benefit does require you to make a minimum monthly payment that is set based on the amount of life insurance coverage you opt into up to $400,000.

At press time, the highest monthly payment is listed as $25 per month for the maximum coverage for $400k. SGLI payments are automatically deducted from your base pay amount each month. You must meet eligibility requirements to sign up for SGLI. This benefit is for service members only and does not provide life insurance coverage for any member of your family. This is a “contingency” type benefit that provides a life insurance payout to your surviving beneficiaries if you die while covered.

If you are retiring or separating from military service, you have the option to continue this life insurance coverage under a different program called Veterans Group Life Insurance or VGLI.

You become eligible to apply for VGLI within a year and 120 days from your date of discharge. You may apply for an amount up to the same coverage you had through SGLI.

Travel Benefits

Space-A Travel (active duty Space A)

Space-A travel is an option for active duty military members, family members, and retirees. Short for “Space-Available”, Space-A is an option that lets you apply for empty seats on military aircraft flying missions approved for extra passengers.

Space-A flights originate from military bases and you sign up for seats on these flights at the base military passenger terminal or online at the official site for that terminal or command. You may be permitted to sign up via e-mail or online.

Some Space-A flights are dedicated back-and-forth trips between military bases in a specified area, others may be added to the Space-A roster last minute based on changes to a mission or its requirements.

Signing up for Space-A travel means you must have authorized leave paperwork if you are a military member, and there is seating priority on all Space-A flights requiring mission-essential travel to be prioritized first, followed by passenger categories from Category I (those on Emergency Leave orders) all the way down to Category Six, which includes:

Retirees
Dependents
Reserve members
ROTC, NUPOC, CEC
Veterans with a total Permanent Service-connected Disability
Surviving Spouses of Service Members who died on duty

Space-Available travel is a great perk of military service but seats are never guaranteed to non-mission-essential personnel. You must be prepared to fully cover the cost of a commercial flight back to your duty station if you cannot get a seat on a Space-A flight.

Space-A flights typically originate and end at an on-base airport or runway. You won’t fly into a commercial airport, and you’ll be responsible for your own travel once you are shuttled off of the runway or allowed into the passenger terminal.

Paid Vacation/Military Leave

You’ll earn 30 days a year plus some holidays, starting in your first year. Servicemembers accrue leave at a rate of 2.5 days per month and you can carry a maximum of 60 days of leave into the new year. Any amount above 60 days is considered “use or lose” time. In some circumstances, additional leave accrual beyond 60 days may be authorized such as during

AAFES, Commissary Access

Military members and their families have access to many perks of military life including the ability to shop on base or on-post tax-free at Army/Air Force Exchange Service (AAFES) outlets, base commissaries, “Class Six” liquor stores where available, gas stations, and much more. Depending on which branch of service is responsible for a given post or installation, you may find options including:

AAFES (Army and Air Force Exchange Service)
MCX (Marine Corps Exchange
NEX (Navy Exchange Service Command)
CGX (Coast Guard Exchange)

Exchanges are basically like big-box retailers like Target or Walmart. You’ll find a similar variety of options there including clothing (military clothing sales, too!), electronics, household items, and sometimes even motor vehicles.

Not all amenities are offered at all installations, but the bigger the base the more elaborate the options are likely to be. To enter an on-base commissary, Base Exchange (BX), Post Exchange (PX), or another facility you must show a current military ID card, dependent ID card, etc. You may be carded for all purchases on post to verify your status as an authorized user but that is a small inconvenience.

Tax Support

There are a number of free tax support options for military members and their families. MilTax is a military-centered tax software program that walks you through a list of questions to determine which military-related tax issues may be present for the current year’s tax filing. You access MilTax through the DoD-funded Military OneSource official site.

There is also an option you can use on-post if offered there; the VITA Program, also known as Volunteer Tax Assistance. While this is not offered at every single military base in the DoD, it is offered at many of them and you can use a VITA locator to see which bases closest to you offer the option.

23 Sep 2222 Feb 23

DoD Announces Housing Allowance Increases for 2022

Service members in high-cost housing markets are getting financial relief thanks to the orders in a September 22, 2022, Memorandum from Secretary of Defense Lloyd Austin. There are multiple directives in that Memorandum, including a review of the 2023 Basic Allowance For Housing (BAH) calculations to keep BAH current with “unusually dynamic fluctuations in the housing market”.

Automatic BAH Increase for Qualifying Troops

But there’s more immediate relief for some; the DoD has been directed to “automatically” increase BAH for service members who live in some 28 “Military Housing Areas” that have had a spike in rental costs of 20% or more.

This automatic increase goes into effect in October 2022 and comes at a time, according to the Defense Secretary, when the DoD is dealing with issues “critical to stability for our outstanding military families”.

Who Is Affected?

Military members living in one of the 28 Military Housing Areas will receive an automatic BAH increase under these areas, which have all experienced a spike in rental costs of 20% or more:

San Diego, California
Twentynine Palms MCB, California
Vandenberg SFB, California
Dover AFB/ Rehoboth, Delaware
Fort Myers Beach, Florida
Miami/Fort Lauderdale, Florida
Patrick AFB, Florida
Orlando, Florida
West Palm Beach, Florida
Volusia County, Florida
Fort Myers Beach, Florida
Kings Bay/Brunswick, Georgia
Maui County, Hawaii
Chicago, Illinois
Boston, Massachusetts
Cape Cod–Plymouth, Massachusetts
Martha’s Vineyard, Massachusetts
Brunswick, Maine
Coastal Maine, Maine
Fort Leonard Wood, Missouri
Helena, Montana
Wilmington, North Carolina
Northern New Jersey
Newport, Rhode Island
Providence, Rhode Island
Beaufort/Parris Island, South Carolina
Knoxville, Tennessee
Houston, Texas
Quantico/Woodbridge, Virginia

Commissaries, Basic Needs Allowances, Child Care

These two moves aren’t the only ones listed in the Memorandum. Secretary Austin notes in the document, “The President’s budget includes a 4.6 percent pay increase for Service members” effective on 1 January 2023. Other improvements include:

“Fully funding” base commissaries “to cut prices at the register, with the goal of achieving at least a 25 percent savings” on groceries compared to buying them “on the economy”.
Offer a Basic Needs Allowance to “eligible service members” a Basic Needs Allowance starting in 2023. This allowance would be calculated based on gross household income.
Enhance Child Development Program facilities and infrastructure; offer a standard 50 percent employee discount for the first child of our CDP direct-care workers to help attract more talented staff and to increase capacity. This is scheduled to begin in October 2022.
“Accelerate the development” of additional occupational license interstate agreements “with organizations representing multiple professions”. This move is intended to make it easier for military spouses to obtain or transfer professional licenses after a permanent change of station move.
The DoD plans a “new career accelerator pilot initiative” designed to place military spouses with “private sector fellowships”. This is scheduled to begin in 2023.

Permanent Change Of Station Moves

There are some reforms for those making PCS moves, too. Starting in October 2022 the Temporary Lodging Expense benefit, paid to those traveling to a new assignment, is extended permanently from 10 to 14 days for stateside moves, and up to 60 days in cases where “a Service member is in a specified Military Housing Area with a housing shortage”.

There is also an increase in the Dislocation Allowance (DLA) for enlisted service members up to grade E-6. This increase is meant to “further help offset personal expenses for PCS moves. DLA payments for all Service members “will be paid automatically one month prior to their move date to pre-empt out-of-pocket expenses” effective starting in October 2022.

What’s Next

At press time, there is no word on what will happen with the top-down BAH review. Will there be an across-the-board increase based on housing market price fluctuations in the last two quarters of 2022? Or will another set of Military Housing Areas be identified for more targeted increases?

That remains to be seen at the time of this writing, but what is certain is that any BAH overhaul based on the review will most likely be paid in the same fashion BAH is currently assigned; the amount of the increase may depend on location, whether the service member has any dependents, and rank.