LSU AgCenter Family Economist Offers Financial Tips For Families Of Activated Personnel

Jeanette A. Tucker  |  4/21/2005 9:30:43 PM

News You Can Use For February 2005

Reservists and National Guard families whose loved ones have been activated often face financial hardship in addition to the stresses of separation, notes LSU AgCenter family economics professor Dr. Jeanette Tucker.

In fact, a Department of Defense survey found that 31 percent of families experienced a decrease in income when a spouse was called up.

"Fortunately, military families can minimize or possibly even prevent financial challenges through careful money management and through the special financial rights available when their loved one is summoned for duty," Tucker says. She cites recommendations from the Financial Planning Association:

• Save enough money in an emergency fund to cover essential needs such as food and housing for several months. Other potential sources for emergency funding include a home equity line of credit or a loan from life insurance cash values.

• Prepare a realistic post-activation budget. This action will enable you to better prepare for cuts and provide motivation for building up savings.

• Shop at any nearby military base stores, where goods and services are generally less expensive.

• Determine family member’s eligibility for the military health program, Tricare, and the specifics of the type of coverage he or she is eligible for.

• Move to on-base housing if it is available.

• Reduce debt. Credit card and other consumer debt can be financially devastating if the family faces a serious decline in income.

• Avoid off-base payday lenders. Their steep fees can increase family debt.

• In advance of activation, designate someone to manage the household finances and make certain your designee is up to speed with your finances before leaving. Single-parent families or families where both spouses are activated will need to rely on a dependable relative, friend or professional help such as a bill-paying service or financial planner.

"Regardless if your spouse is already on active duty, or may soon be, familiarize yourself with the many special financial rights that may be available to you," Tucker advises. She notes that activated reservist or National Guard or deployed regular military are generally covered under the recently enacted Service Member’s Civil Relief Act, which strengthens the original 1940 Soldiers’ and Sailors’ Civil Relief Act. Key rights include prevention of eviction from rental property when rent is less than $2,400 a month (indexed for inflation), the ability to break a housing or auto lease, temporary stays of civil proceedings such as bankruptcy, foreclosure or divorce and the ability to cap interest rates at 6 percent on pre-existing loans, such as credit cards and mortgages. Military personnel are required to notify the lenders in order to get this cap.

For information on related family and consumer topics, visit the FCS Web site at
Extension/Departments/fcs/. For local information and educational programs, contact an extension agent in your parish LSU AgCenter office.


On the Internet: LSU AgCenter:
Source: Jeanette Tucker (225) 578-5398, or

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