Ways for Veterans to Recover From Bad Financial Choices


One of the hardest parts about being in the military is creating a stable financial foundation. If you made poor choices in the past, you may not feel like you have a stable foundation. Even though you may have learned from these mistakes, they may still reflect your lack of savings or poor credit score. The good news is that you can recover by taking a few actionable steps.

Always Use a Budget

Whether you want to recover from recent poor spending habits or need to plan for purchases in the future, you will need to create a budget to ensure you are able to pay back all your obligations. If you have not started tracking how much money you have coming in or going out, you will need to find a way to track these numbers. You can use budgeting apps, websites, desktop apps, or spreadsheets. The important thing is to find something that works for you and that you will stick to. 

Tracking the money coming in and out means you can see where you need to be extra careful. One area you may want to consider is debt repayment. Many veterans have successfully used personal loans to cover gaps in their budgets that debt can leave. Using a personal loan also prevents you from putting assets like your home on the line when you need extra funds. Are you wondering should I get a personal loan? You can review a guide with more information on when you should and should not use this tool.

Consider Credit Repair

If you are still recovering from your choices in the past, your credit score may not be as high as you would like. Having a high enough credit score shows potential lenders you can pay back the money, so if you want to buy a car or house or get a rental, you will need to have a good score.  There are a couple of ways to repair a low score. 

The first step is to start paying back money that is currently owed to different lenders. You could renegotiate your balance, transfer the balance, or ask for an increase in your credit line. Debt consolidation is another option. You can consider meeting with a financial professional as well can help you figure out what the best option is for you. It’s important to make sure you don’t spend more than you can afford. 

Credit cards can be helpful, especially if you can take advantage of rewards offered by many. But they only help you if you can use them responsibly. Those who struggle to stay within their monthly budgets may want to use a checking account with a debit card attached to it. This can help you develop better habits and then slowly get back into using credit cards. You should also create a history of paying back debt on time. When you make regular payments on time, you will slowly build up a reputation for being a reliable borrower, helping boost your credit score. 

Everything from current debt to rent to utilities can count toward your credit score, depending on what type of credit check is run when a lender wants to know your score. You should make at least the minimum, but preferably more, each month. This will help show the progress you are making toward the person you want to be.

Always Have an Emergency Fund

One reason so many veterans get into debt is that they have a financial emergency come up, and then they need to borrow money to pay for it. An appliance in your home may break or you might need an expensive repair to a vehicle you rely on to get to and from work. An unplanned expense is often the difference between going into debt and getting by for many veterans. After creating your budget, you should create an emergency fund. 

This doesn’t mean to try and get quick cash, make money with crypto to build wealth or to hide some loose change in your dresser. This should be a separate account with a few thousand dollars that you will only touch if an expense comes up. It should never be used to pay for a want, like a vacation or new TV. Saving a few thousand dollars may seem completely out of budget right now, but the trick is to start slowly and go from there. Even having a couple of hundred dollars right now is a start. Consider putting your next tax refund or any windfall into the emergency account, and then increase savings until you have hit your goal.


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