WASHINGTON (6/27/12)--Educating servicemembers on their financial services options, and communicating basic financial literacy concepts, can be a challenging process. Witnesses at a Tuesday Senate Banking Committee hearing detailed their own work to improve financial literacy in the military and help shield members of the military from future financial issues.
Consumer Financial Protection Bureau (CFPB) Office of Servicemember Affairs leader Holly Petraeus during the hearing said her office is working hard to fulfill its mission to work on consumer financial education and consumer-protection measures for military personnel and their families. One obstacle to financial literacy efforts, she said, is the spread out nature of the military, which has facilities across the nation and the world.
New military recruits at one Air Force base had an average of $10,000 in debt when they arrived at their post, Petraeus noted.
Petraeus said she hopes the CFPB and others can reach incoming servicemembers before they attend initial boot camps, to give them "'just-enough and just-in-time' financial lessons that could be very helpful before they get that first military paycheck and start thinking of ways to spend it." Her office has developed a short financial-education curriculum that can be delivered via smartphone or computer after an individual has signed up for the military, but before they have begun their training. Petraeus said the Pentagon and senior military officials are enthusiastic about the planned education efforts, and have signaled their intent to help the CFPB field the program.
She also said she wants to enhance the CFPB's ongoing educational efforts through online and electronic means, such as websites and mobile apps, and hopes that these efforts would help increase the financial literacy of servicemembers' spouses as well.
Overall, Petraeus said, the CFPB's efforts seek to make financial education less of a lecture and more of a cooperative effort.
Delaware Attorney General and Delaware Army National Guard Major Beau Biden said the National Guard has stepped up its own financial literacy efforts, and noted that he has heard of many commanding officers that have stepped in, at times, to help their subordinates navigate financial issues.
Credit unions provide financial education and resources to servicemembers and their families in a variety of formats, including deployment briefings and guides to help soldiers prepare before they are deployed abroad. These financial efforts address steps servicemembers can take before, during and after they are deployed to achieve various financial goals.
Servicemembers and their families are members of more than 330 credit unions with military or defense-related charters that serve over 18 million memberships. Many credit union products that are provided through both on- and off-post credit union branches are specifically designed for servicemembers, veterans and their families, and address issues like active deployments, military relocations, and other circumstances.
The Defense Credit Union Council also represents the interests of credit unions that operate on military installations, and works closely with the Pentagon and member credit unions to coordinate policy, procedures and legislation impacting morale and welfare, financial readiness, and the delivery of quality financial products and services to Department of Defense personnel and their families. The council comprises 235 credit unions serving more than 14 million members.
For more on the hearing, use the resource link.