Credit Cards

The road to financial success in military life - as in civilian life - is paved with a history of good credit.

Paying bills on time - at least the minimum due on your credit cards and more, if possible - staying current with payment deadlines - these can be challenging tasks when you're on military deployment, or if you're home leading a busy military life. But on-time payments will serve you well: banks and lenders will offer you more credit, at better rates, simply because you consistently paid your debts on time.

Good credit keeps your interest rates low, allowing you access to things like a new car or a well-maintained used car. Low interest rates can save you hundreds of dollars in payments each month - money that can be used for savings for your military retirement or to enrich your military family life today.

For instance, with good credit, you may have access to a $20,000 car at 3.5 percent interest for five years; you pay only $364 per month. After five years, you have paid only $1,830 in interest. With weaker credit, perhaps you can only get a loan at 10 percent for five years, and your monthly payment is now $425 per month, and you pay $5,500 in interest during the length of the loan. With truly bad credit, you may pay interest as high as 25 percent, which would be a monthly payment of $587 and more than $15,000 in interest. Ouch.

Active military with good credit have lenders competing for their loans. They'll offer the best deals - which sometimes means the smallest down payments. Military personnel with bad credit typically are required to pay 20 percent down or more . Home buyers with outstanding credit may pay only three percent down on a new home and still receive an excellent interest rate. (Veterans and military personnel with good credit may even get deals of 0% down with a VA home loan.)

So, enjoy the perks of military life, and when you're spending, think like a lender. Protect your credit rating. Don't max out your credit cards. Live well, and within your means. It's more important to know you can pay your bills easily, whether you're home or on military deployment, than to overextend your military salary and live with financial anxiety.