Posted on Apr 1, 2014

How can we influence/educate Soldiers to stop making impulse buys?

CPT (Join to see)

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It is common for E-4 and below to waste their money on things they don't need. Most haven't learned to save their money or determine how much money should be allocated to things such as diet pills and medieval sword collections. Has anyone experienced any effective classes or resources to teach these important life skills?

Posted 10 y ago

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MAJ (Join to see)

Posted 10 y ago

I gave my platoon a class on finance before returning from Afghanistan. Human beings in general (not just junior Soldiers) are not hardwired for long-term future projections. Retirement planning is not something that comes naturally, but a simple thought exercise drives the point home. I call it the 16 for one rule.

A dollar invested by a 20 year old Soldier now will be worth $16 when the Soldier is ready for retirement. The 16 for one rule is a simple question Soldiers can ask themselves before making a purchase. Would I pay $16 for this $1 cheeseburger?

When Soldiers realize what they are giving up in real dollars long-term for short-term gain they "get it." Help them visualize in real terms what they lose then for profit now and they will change their behavior and the behavior of others around them.

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MAJ (Join to see)

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Back when I was that age, if you wanted to make a major purchase, you had to be accompanied by an NCO. I know that something liked that is 'frowned' upon now-a-days, but it stopped me from buying a brand new Chevy Avalanche I didn't need.

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CSM Michael J. Uhlig

Posted 10 y ago

1LT Despard, I think we all buy things we don't "need" (e.g. a television - do we really need a TV?)....not trying to get into a theoretical debate, I understand your point and can share a story from my experience, which was wrong but turned out right for one of my Soldiers.

I was new in position as a 1SG (at Fort Polk) and had been told about one of the Soldiers that was very impressionable and a follower, and that he was one to watch (to help protect him from himself). It was at about a week in the seat when I got a call form a car lot wanting to finance a car, the salesman was looking for employment verification.....I told him the Soldier was in the unit and facing a Field Grade Article 15 and would be separated from service within the next 30 days....he was not approved for the overpriced Saturn ($16,000 for a 6-year old Saturn!). I called the Platoon Sergeant and told him to get the Soldier into the CP ASAP! The Soldier was very upset to learn he was facing UCMJ and a chapter (he heard that from the car salesman). The Soldier brought the contract (from an on-the-lot financing, E-1 & up instant financing joint) and we reviewed it to find 21.9% financing with multiple punishment fines built into the contract as well. The Soldier was upset for a couple weeks, but when I sat with him in the DFAC he confessed that he would not have been able to afford that car, it was a case of a snap decision and an aggressive car salesman.

To your thread, we can talk with our Soldiers, NOT AT THEM, so they understand the way interest works, show them an amortization schedule which shows how they pay for things over time and how it compounds itself. I suggested to my daughter and sons (my youngest is in the military) that they all establish credit with the local credit union by getting a $500 signature loan while understanding they will pay some interest. Then move up to a revolving credit card (e.g. gas card or something small) so they establish credit while they are young and then when they need a vehicle or larger purchase they will have some established credit so they pay a smaller rate. This is a very important topic for the financial health of our force.

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