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Veteran & Active Duty Military Credit Counseling

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Financial problems, it turns out, are bigger stressors among military families than deployment, moving, and separation from family.

Service members and their spouses ranked financial stress as their biggest concern in a 2018 military family lifestyle survey by Blue Star Families. Seeing marriage therapists, assistance with moving, and preparing for deployment all help.

And so does military credit counseling.

Credit counseling for veterans or active military members helps them evaluate their finances and learn how to deal with debts. Service members are often young and financially inexperienced, and who doesn’t look back and wish they got some good financial advice when they were starting their lives as adults?

More than one-third of enlisted military members don’t pay their bills on time. About half say they had to get a second job to supplement their income, according to the 2019 Military Financial Readiness Survey conducted by Harris Poll on behalf of the National Foundation for Credit Counseling (NFCC) and Wells Fargo.

Managing debt while serving in the military can include getting loans from friends, payday loans, or using credit cards to pay debts.

Veterans face many of the same financial problems, particularly those who are unemployed or homeless. Credit counseling can help veterans in debt, as can free financial advice and legal counseling through the Veterans Administration (VA), such as its Debt Management Center.

Veteran and Active Duty Military Credit Counseling Services

Talking to a stranger about credit card debt can be difficult, even if it’s someone who’s trained to help with military credit counseling. Not making house payments or paying water bills on time, or falling behind on a car loan, can seem like reasonable forms of debt because they’re everyday living expenses.

Credit card debt, however, can feel like frivolous expenses. Who knows what you used that credit card for? To pay a bar tab? A weekend getaway? Groceries?

Whatever it is, problems with credit card debt can be fixed, and military credit counseling can help. Talking to a nonprofit financial counselor certified by the NFCC helps service members and veterans navigate not just credit card debt, but processes set up by the Department of Defense (DoD) and the VA.

Here are a few ways they help:
  • Debt management plans
  • Financial education
  • Dealing with creditors
  • Debt consolidation
  • Referrals to VA services

Debt management plans work on your behalf to get creditors to reduce your monthly payment and interest rates on your debt, and to waive or reduce any penalties. They consolidate credit card debt and provide an affordable payment schedule so you can pay off the debt in 3-5 years.

Nonprofit credit counseling agencies also offer educational material that includes best methods for dealing with creditors and the debt consolidation options for military and veterans.

Credit counseling for veterans helps them wade through benefits the VA offers veterans, including unemployment benefits, VA pensions, and home loans.

Who Is Eligible for Military Credit Counseling?

Military credit counseling is available to all current and former service members, reserves, and their families from any military branch.

Service members spouses, for example, are prime candidates for credit counseling, especially if their spouse is away on deployment. They may not be able to find a job and could rack up credit card debt paying daily living expenses. Military credit counseling can help.

Spouses shouldn’t feel alone in facing debt. Service members and their spouses and partners are more likely than the general U.S. population to be behind on bill payments. About 3 in 10 spouses or partners of service members say they don’t pay their bills on time, according to a study done for the NFCC.

Financial counseling is usually done by phone, but can happen in person or online. The number of counseling sessions is unlimited, so there’s no reason not to call for help if your financial needs change over the years.

Helping Veterans and Active Military Members Improve Bad Credit

Credit problems happen to military members for many reasons. Here are some issues that lead to problems for military families and spur the need to seek military credit counseling:

Moving Often

Moving is especially stressful for military families. They may have to pack up and move with little notice. That can lead to one bill, or more, being paid late or not at all as things get forgotten in the shuffle.

Credit scores will drop, and service members or their spouses may be so busy with moving logistics that they forget to monitor their score. The next thing you know, applying for home or car loan is difficult, if you even qualify for one.

J.R. Duren remembers the financial struggles of growing up in a military family, especially the costs and problems of moving often.

“My parents were locked in a custody battle while my dad was stationed in Hawaii,” says Duran, who lived in Hawaii from 1986 to 1990 and is now a senior editor at, a consumer reviews website.

“Money was very tight,” he said. “In fact, I remember my dad and I going on base to pick aluminum cans out of trash cans to generate money we used to do fun stuff like going bowling.”

Moving is synonymous with being in a military family, and while the military provides financial assistance during moves, the stress and expense results in a few things, Duren says.

“First, it can be difficult to understand the cost of living differences and added expenses of moving to a new city whether domestic or foreign,” he says. “If the family doesn’t have enough money saved, any unanticipated expenses —whether from living on-base or off — will most likely go on the family’s credit cards.

“What’s tough about that isn’t just the up-front cost, though,” Duren says. “If a military family has no savings and they incur debt during a move, they may very well make payments all the way until they’re stationed somewhere else. The cycle of debt continues; they move, build up debt, pay it off, move, etc.”

Some businesses target military families who move around a lot and need cash fast. These include payday lenders, check cashing stores, and rent-to-own businesses that all charge high interest rates.

If your bank doesn’t have a branch in the city you’ve just moved to, you might use a check cashing service and have to pay its fee every time you cash a check there. That’s no way to spend your money. Look for other options.

While there’s no way out of being told you have to move, there are ways to lessen the financial impact.

One is to automatically transfer money to a “moving fund” at your bank so that you’re better prepared for the inevitable move. It doesn’t have to be much — maybe $100 a month — so that you can better handle last-minute expenses that pop up during a move.

Low Pay

Not earning enough money can be a big part of not being able to pay your bills on time — for anyone. But having a low income is more common in the military.

The starting salary for a private in the Army is $20,160, or about $387 per week. For comparison purposes, the average high school graduate earns $28,000 a year.

One way to deal with this is to take on higher-paying jobs in the military. Galen Bargerstock joined the Army so he could pay off $72,000 in student loan debt after earning a bachelor’s degree in audio engineering and recording. He went to flight school and did other jobs in the military that paid well, then got out of the Army after paying off his debt.

Bargerstock, now 38, owns Government & Civil Employee Services in Indiana, PA, which explains government benefits for workers about to retire.

Checking Credit Reports and Identity Theft

If you’ve been deployed away from home, it can be hard to check your credit reports and know if you’re the victim of identity theft. The stresses of the battlefield can obviously be more than enough to take up your time.

Being out of the country for a long time can make soldiers more vulnerable to identity theft for the simple reason that criminals can get away with it for a longer time. One way to deal with this is to get your free credit reports at least once a year at Check it for incorrect information such as accounts that were opened without your approval, which is a sure sign of identity fraud.

Fixing errors can also raise credit scores, and could lead you to see the importance of paying bills on time as a way to raise scores.

Being Young and Unprepared Financially

The inexperience of youth can lead to debt problems if you don’t know much about finances or don’t have a family budget.

“Many new military families are young and both the husband and wife may lack the proper financial training,” Duren said. “This lack of understanding will affect how they spend their money, how they manage their debt and how they handle their credit scores.”

Having good financial habits is a lifelong process. You can educate yourself at the library, for instance, or talk to military credit counselors for help on how to deal with a financial problem or set up a budget.

The Consumer Financial Protection Bureau has a list of sources to help servicemembers through every stage of their military service, from enlistment through retirement. It explains financial basics such as dealing with debt collection, tackling student loan debt, car buying skills, and using alerts to protect your finances.

Having Excessive Debt

Debt and bad credit can also affect security clearances. Bad credit and other money problems can disqualify service members from receiving security clearances for a simple reason — they’re considered more open to bribes or accepting money in exchange for revealing secrets.

Military credit counseling can help former and current military members with bad credit. If you have high debt from credit card bills, for example, then credit counselors may talk to you about lowering your debt-to-income ratio (DTI). Having a ratio over 50% can be a sign of “excessive indebtedness,” which the military may use to disqualify a soldier for a security clearance.

DTI is measured by dividing your total monthly debt by your monthly income. For example, if you owe $2,000 a month and have income of $4,000, your DTI is 50% (2000 ÷ 4,000 = .50). Paying down a credit card and keeping it down should lower your DTI ratio.


Getting deployed can be a chance to leave your debt behind, but only for awhile.

“In order to get deployed, you can’t be in an insane amount of debt,” said Bargerstock, who was in the Army from 2002-05 and was deployed to Iraq.

Being deployed allows service members to put off their debt until they return, mainly so they don’t have to worry about it and can better focus on the mission. They can still take on credit card debt and pay it when they return home or leave the military, but during deployment they’re given a break. The Servicemembers Civil Relief Act (SCRA) also protects active-duty service members and their families.

The SCRA  offers free legal and financial help, and offers protections such as:
  • Reduced interest rates on debts: Creditors can charge up to 6% interest on debts incurred before entering active duty.
  • Postponement of foreclosures.
  • Deferred income taxes.
  • Eviction prevention.
  • Protection against default judgments: A delay of at least 90 days and the defense can’t be presented until you can attend.
  • Termination of auto leases and phone service.
  • Prevention of repossession of property.
  • Life insurance coverage protection.

The DoD recently launched a website it calls Financial Readiness to help with financial literacy. It has stories on how to protect yourself from identity thieves, dealing with finances during deployment, and has lots of money management tips.

Choose a Reliable Credit Counseling Organization

The Federal Trade Commission and the NFCC suggest that people seeking credit counseling work with legitimate nonprofit credit counseling agencies. The agencies offer counseling for free or at a minimal charge.

The NFCC certifies financial counselors within its membership agencies.  Nonprofits are frequently audited by states, and they’re under strict guidelines to ensure they act in their client’s best interests.

Research credit counseling agencies as much as you would shopping for the best loan. Look for agencies that have these attributes:
  • Licensed in your state and accredited
  • Counselors are certified, preferably by the NFCC
  • Offer educational workshops and reading materials
  • Provide a contract that puts in writing the fees, services and time to complete the program
  • Tell you what happens if you can’t afford its fees or miss a payment
  • Detail what it does to prevent identity theft
  • Don’t pay counselors by commission

It’s important to choose a certified credit counseling agency because military members are often the target of credit repair or loan scams.

Scammers may call or email you with promises of helping solve your debt problems if you pay upfront fees such as through a wire transfer. Legitimate credit counseling agencies will never ask for payment upfront before providing services.

Verify you’re working with a good counselor by:
  • Checking that they’re registered in your state. Check with the attorney general’s office or banking or financial regulation department in your state.
  • Google the company’s name and read online reviews at the Better Business Bureau and other review sites.
  • Look up a customer service phone number for the company and call it. If you’re uncomfortable speaking with a representative, then don’t do business with the company.

About The Author

Max Fay

Max Fay has been writing about personal finance for for the past five years. His expertise is in student loans, credit cards and mortgages. Max inherited a genetic predisposition to being tight with his money and free with financial advice. He was published in every major newspaper in Florida while working his way through Florida State University. He can be reached at [email protected].


  1. N.A. (2018) Blue Star Families Military Lifestyle Survey. Retrieved from
  2. N.A. (ND) Debt Management Center. Retrieved from
  3. N.A. (24 January 2020) Servicemembers Civil Relief Act. Retrieved from:
  4. N.A. (ND) Navigating the military financial lifestyle. Retrieved from:
  5. N.A. (ND) Office of Financial Readiness. Retrieved from: