Home > Credit Score > How to Maintain Good Credit While Serving in the Military

Comments 0 Comments

Budgeting during deployment or transfer to a new assignment might be on the mind of many military service members. What might not be are credit scores and how they could impact the costs for everything from a credit card’s annual percentage rate, or APR, to a new mortgage.

Here are four tips for how to maintain good credit while serving in the military.

1. Save When You Can

Whether you’re on active duty, in the reserves or are returning from tour, keeping a savings account may help you avoid going into debt now or down the road in an emergency. (Consider these five mistakes to avoid when you start saving.) 

“The best advice is to make savings a priority while avoiding unnecessary spending,” Bruce McClary, the vice president of communications for the National Foundation for Credit Counseling, said in an email. “Adequate savings will help avoid financial emergencies that would otherwise lead to unmanageable debt. Savings also helps during periods of transition from military to civilian life.” 

While you’re serving can be a good time to save, as some of your expenses may be covered by the military. This can help you save for emergencies or hefty future expenses, like raising a family or buying a home. (Though some veterans can qualify for 0% down VA home loans.)

2. Communicate With Those Back Home

If you are sharing an account with someone at home, it’s a good idea to discuss payment plans and spending before you leave so everyone’s on the same page. But the communication shouldn’t end there.

“Staying in touch with joint account users, such as spouses, can help avoid any surprises while keeping accounts paid as agreed,” McClary said. “At the same time, you should use all means available to monitor account activity online whenever possible.”

3. Use Online Resources to Your Advantage

Depending where you are deployed, you may or may not have frequent internet access. However, if you do, there are several online tools to help you maintain good financial habits while serving in the military, like online banking and budgeting tools.

“Those serving on active duty can set alerts that help them keep a closer eye on how an account is being used, giving them instant access to charges and balances,” McClary said. “Payment due date reminders can also be helpful, along with automatic payments.”

Having a late payment can subject you to late fees, and missing one altogether can potentially harm your credit score. So even if you have automatic payments set up, it’s a good idea to monitor those and ensure they go through as scheduled.

“If automated payments have been arranged, set a schedule where you can check to see if they were processed correctly,” McClary said.

If you don’t have internet access while overseas, consider having a trusted family member check your accounts to make sure any automatic payments are processed correctly and on time.

4. Keep an Eye on Your Credit

“Credit reports should also be monitored on a regular basis,” McClary said. If you have internet access, you can get your free credit reports once a year on AnnualCreditReport.com, and you can view your free credit report summary, updated each month, on Credit.com. Should you find any inaccurate information, you can dispute the errors on your credit reports with the credit reporting agency or agencies that have it wrong.

Members of the military who are deployed can also consider placing an active duty alert on their credit reports.

“An active duty alert remains on the report for one year,” Rod Griffin, Experian’s director of public education, said in an email. While the alert only lasts a year, it can be renewed. “It notifies creditors that you are a member of the U.S. military and that you are currently on active duty,” he said. “An active duty alert does not require a lender to contact you directly to get your approval before granting credit in your name, but it does enable them to take appropriate action to protect your identity.”

More on Credit Reports & Credit Scores:

Image: Mie Ahmt

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Certain credit cards and other financial products mentioned in this and other articles on Credit.com News & Advice may also be offered through Credit.com product pages, and Credit.com will be compensated if our users apply for and ultimately sign up for any of these cards or products. However, this relationship does not result in any preferential editorial treatment.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Our Owners

Credit.com is owned by Progrexion Holdings Inc. which is the owner and administrator of a number of business related to credit and credit repair, including CreditRepair.com, and eFolks. In addition, Progrexion also provides services to Lexington Law Firm as a third party provider. Despite being owned by Progrexion, it is not the role of the Credit.com editorial team to advocate the use of the company’s other services. In articles, reporters may mention credit repair as an option, for example, but we’ll also be sure to note the various alternatives to that service. Furthermore, you may see ads for credit repair services on Credit.com, but the editorial team isn’t responsible for the creation or implementation of those ads, anymore than reporters for the New York Times or Washington Post are responsible for the ads on their sites.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team