Service members face specific financial and emotional challenges—extended separations from family members and multiple moves over a short period— that are not common in “normal” civilian life. Financial stress is a historic challenge faced by military members, with 56 percent describing their finances as unstable. Luckily, there are certain credit cards and benefits military families can utilize that offer specific military benefits. Additionally, it is important for military members to protect themselves from identity theft, as they are often victims of fraudulent credit card applications.
Due to the specific challenges faced by military members, a lot of military credit cards have emerged with specific benefits and features that go beyond the traditional benefits of civilian cards. Many credit card companies even go beyond the federal requirements and guidelines, offering military members great options for establishing their life post-service. When considering different credit card options, veterans should educate themselves on key benefits available to them and important features to look for.
When looking for a military credit card, it is important to know what to look for and what benefits you are eligible for. Over the years, many credit card options have emerged for military members, and it can be challenging to discern what credit card will best suit your individual needs. The minimum features you should look for in a credit card include:
The Service Member Civil Relief Act (SCRA) is a federal act that all military families should become familiar with. This act offers military families key financial benefits that should be utilized to ensure financial stability. The SCRA requires all financial institutions to cap interest rates at 6 percent for loans or debt during times of military deployment. Although the federal requirement is 6 percent, many financial institutions go beyond this, offering service members better rates and terms. To get the benefits of the SCRA, you have to notify your credit card company of your military status. It is important to notify your bank of your military status.
The Veterans Administration (VA) offers service members some amazing benefits for buying their first home. Many service members struggle to buy a home because they do not have enough money saved for a downpayment. Through this program, the VA guarantees up to 25 percent of the total cost of a home-loan, which allows many service members to not worry about the initial down payment. Military members should meet with a financial advisor to determine their eligibility for this program.
Identity theft is one of the biggest problems that plagues service members. The Federal Trade Commission (FTC) recommends active service members to place an “active status” alert on their credit report to stop any credit card applications under their identity. Service members can request the credit alert by contacting one of the three credit card bureaus—the alerted bureau will notify the other two of your request. Placing this alert will help service members steer clear of fraud and identity theft.
Managing finances can be a major point of stress for everyone; however, military service members face unique challenges in managing their bank account. Due to the unique problems plagued by service members, the government and many credit card companies have come up with specific features and benefits for service members. As a service member, you should look for the credit card that best benefits your financial situation, and make use of military federal benefits.
Publish Date: May 15, 2020 3:52 AM