One of the most important categories of money management for all military families is planning for a Permanent Change of Station (PCS). If you are in the middle of a PCS or if you anticipate one in the coming months, this time of transition and the ensuing expenses can become a huge drain on your finances and even your mental health.
Like the certainty of death and taxes, changing duty assignments comes with the territory of military life. Now more than ever, families must be deliberate and calculated with planning for a smooth transition that doesn’t end up costing too much.
Here are actions you can take before and after your move to maintain your financial footing.
Prior to Your PCS
Following are 9 steps that will help you better manage your PCS financially and emotionally:
1. Know the intricate details of your income and expenses.
If you haven’t taken the time to properly educate yourself on every single penny coming in and going out of your household, now is the time to commit to a written or digitized budget.
Get a copy of your servicemember’s most recent Leave and Earnings Statement (LES), your own pay stub, and/or records of any other allotment of money coming in and take note of what you have. It’s important to understand this financial snapshot as you begin to shop for housing and other upcoming expenses at your new duty assignment. This exercise may determine the need for additional income or employment to help cover costs.
2. Use your transition to audit your spending and recurring expenses.
A transition is a great time to make changes to your budget. If you have been previously tied to a certain set of expenses, a PCS offers a natural opportunity to make significant changes to your lifestyle. Do an audit, line by line in your budget, to see where you can create some margin. For example, could you reduce or eliminate your cable TV or some of your streaming services? Are there any subscription services you aren’t using? Do you have any gym memberships or security service contracts to cancel that you could possibly live without in your new city?
3. Check up on your vehicles.
Besides housing expenses, your next highest expense is likely your vehicles. A key to making your PCS travel easy is to assess what needs your cars, trucks, SUVs, motorcycles, or other recreational vehicles may have. Will you sell or store any of them? Do they need routine maintenance, oil changes, a new set of tires, or an emissions test before you hit the road? Plan ahead to cover these costs and schedule them in advance of your move. And don’t forget to update your registration and auto insurance when you change residences.
4. Research current military allowances and reimbursements.
Before you consider a personally procured move (PPM), those hotel reservations, the trailer rental, or plan your route to your new home, have your servicemember get up to date on any changes to dislocation allowances, per diems, mileage, and reimbursement policies by a visit to the installation’s transportation office or website.
Maximize the dollars you will receive for your move and don’t let a policy change or fine print of a rule penalize you from what is owed to you. Knowing when these dollars will hit your account can be incredibly helpful in your financial planning.
5. Decide how you plan to pay for your incidental costs.
Once you have a good idea of what is covered or reimbursable by the military, the next step is to figure out how you plan to pay for transitory expenses up front. Will you save ahead funds of time and use cash? Will you use your debit card for purchases? Will you move money from your savings and pay yourself back when the military pays you? Or will you put all expenses on a credit card and pay it off later?
If your move falls between pay periods or if you will owe significant deposits or down payments, be sure you have thought about what money is coming from where.
6. If you are “cash-flowing” the PCS, where will the extra funds come from?
About six months out, you should begin setting aside a monthly amount of money earmarked just for our move. Sometimes it could be a small amount and sometimes a larger amount. Having an infusion of cash built up ahead of time is always necessary for the extra fuel costs, extra eating out during the transition, and even purchasing those last-minute items for the new place.
7. Don’t be surprised by unforeseen expenses.
It seems that no matter how far in advance you start planning, how much research and preparation you do, there is ALWAYS, ALWAYS, ALWAYS some unexpected expense right around the time of the move. While most of these circumstances can be chalked up to “that’s just life,” it will keep your sanity in check to realize that unexpected expenses should be expected after all. Be prepared for whatever it will be by setting aside a certain amount just for this.
8. Find healthy (and inexpensive) ways to cope with the stress of the PCS.
Some experts rank a relocation right up there with death and divorce on the scale of stressful life events. If you have moved before, you probably know this to be true. Moving is stressful. In times of stress it can feel easy to excuse bad habits and mentally give yourself a pass on doing what’s good for you, both physically and financially.
For most of us, this looks like overconsumption. Maybe it’s too many trips through the drive-thru for convenience food or too many drinks from the hotel mini-bar.
Instead, find alternatives for coping. Consider taking a family drive to a local park in your new town or take a walk around the hotel. If all else fails, don’t forget the power of a good nap — sleep can fix a multitude of problems.
9. If Possible, Use What You Already Have
A PCS can often feel like a legitimate excuse to let your spending run rampant. In addition to the outpouring of costs to fill up your fuel tanks, feed your family, and get settled in your new home, sometimes it seems completely justifiable to go out and buy anything and everything brand new to complete your new home. Some of your things will obviously need replacement (basic pantry staples or cleaning supplies), but a PCS can also be a good time to practice delayed gratification. Find out how creative you can get in reusing and repurposing furniture and decor items.
After Your PCS
Once you’ve completed your PCS, the following are 4 actions will help keep your finances in order:
1. Keep Organized Records and Begin to Draft a New Budget
A PCS can be a time when you’re tempted to stick your head in the sand about your finances. Whether it is the irregularity of your accounts or the sheer pain from overspending, it can appear like ignorance is bliss.
In fact, it can be quite difficult to keep track of what is coming in and what is going out. With final bills, balances, and potential refunds from your last residence to paying deposits and watching for reimbursements from Defense Finance Accounting Service (DFAS), it is taxing to ascertain an accurate financial snapshot.
However, careful record-keeping is a must. As these one-off charges and credits to your accounts begin to subside, it will become clearer what a typical month of expenses will look like as you adjust to a different basic allowance for housing (BAH), any cost-of-living allowances (COLA), new rent or mortgage amounts, and utility costs.
Whether you use our free budgeting worksheet, a notebook and pen, or a built-in system provided by your bank, it is wise to begin letting a revised budget take shape so that you can continue to make sure your spending and your financial intentions are aligning.
2. Zoom In, But Remember to Zoom Out, Too
A PCS is a time in the life of a MilFam when the intensity of immediate circumstances can distract you from long-range priorities.
You’ve spent the past several weeks zooming in and hyper-focusing on the most pressing and immediate needs in order to settle in at your new duty assignment.
Now, remember to zoom out too as you budget and create your new patterns of life financially. Make sure that how you are planning, saving, and spending now, also aligns with your hopes and dreams one year, five years, or even twenty years down the line. Daily decisions impact your future self.
3. Have a Partner Dream Meeting
One way to ensure your daily decisions are in line with your greater life and financial goals is to have a planned dream meeting. You can call it a bucket list meeting, a vision-casting meeting, or a life planning session. The idea is that you and your partner sit down together and air your thoughts, opinions, and hopes for the immediate future.
Take time to forecast some of the important milestones of the next few years while you are at your new duty station. Will a child need braces or private school tuition? Will you need to replace a vehicle? Are there any great attractions nearby you’d like to visit or plan for a vacation to see? Will you or your spouse finally tackle that next educational degree or professional pursuit?
These conversations will allow you to articulate and communicate your needs and wants, and to see what financial steps you’ll need to take together to realize or achieve those dreams.
4. Remember That Money Doesn’t Buy Happiness
A PCS can bring about a lot of discomfort — not just weeks of sleeping on an air mattress or your tired, achy muscles from unpacking boxes of everything you own. It’s also annoying and sometimes downright distressing to feel physically lost in a new city — you get turned around, or don’t know how all the roads connect.
“Retail therapy” can momentarily dull the ache of loneliness, fear, or disorientation. Recognizing this will help you put steps in place to fill those voids with more productive behaviors. Seek relationships with those around you. Make a meaningful contribution to your community. Or explore a creative outlet. The cost of these experiences? Zero dollars.
Final Thoughts
Try not to let a PCS derail you and realize that you can only do what you can do. Make good decisions where you can, stay organized with your budget and filing paperwork for allowances and reimbursements, and don’t go into debt for things that are not necessary. If you find yourself completely overwhelmed, use this as a learning opportunity to plan better for the next PCS. If you find yourself in true financial distress, Military One Source can direct you to resources for Emergency Relief.