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Department of Defense Financial Readiness Update CDR Dave Julian Director OSD Office of Personal Finance Milit

Topics. Economic Environment (

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Department of Defense Financial Readiness Update CDR Dave Julian Director OSD Office of Personal Finance Milit

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    1. Department of Defense Financial Readiness Update CDR Dave Julian Director OSD Office of Personal Finance Military Community and Family Policy

    2. Topics Economic Environment (“VUCA”) Financial Readiness Campaign “Roadshow” Events FINRA Military Retirement Confidence Survey Questions

    6. Good news……? Our Service members and their families are not immune from the storm, but they do have some shelter: Guaranteed paycheck Spousal employment programs Low-cost child care programs Medical/dental benefits Commissary/Exchange privileges & other installation support Special pays & moving allowances Tax-free housing and subsistence allowances Only 25-30% own homes as primary residence

    7. Started in 2003 to reduce the stressors associated with financial issues on Service members and families Education, resources, protections Federal, state, local/non-profit outreach and programs Platform represented by 8 “Financial Pillars” The DoD Financial Readiness Campaign

    8. The Pillars of Personal Financial Readiness

    9. Military Saves 2009 22 February – 1 March 2009 Events planned at installations world-wide Incentivized savings programs at banks & credit unions Saver Pledge Quarterly themes: 1st quarter: Save and Invest 2nd quarter: Youth Financial Readiness 3rd quarter: Debt Reduction 4th quarter: Retirement

    11. Military OneSource Military One Source (www.militaryonesource.com) 24/7 world-wide assistance, on-line and by phone “Money” Section Telephonic financial counseling or face-to-face upon request Effective 17 Nov: Partnership with NFCC Mortgage/foreclosure assistance Referrals, connections to key helping agencies

    12. Installation/Unit Financial Managers/Specialists Military One Source Telephonic counseling Military Family Life Consultants “Personal Financial Counselors” (PFC) AFC/CFP-certified On-demand assignments upon installation request Briefings, one-on-one counseling, education & training Financial Readiness Partners

    13. FINRA initiative in partnership with AFCPE & NMFA Program: Personal Finance and Financial Counseling & Debt Management Study group webinars Examinations Practicum hours (scaled) 200 selectees from 2000 applicants 172 active participants (11% drop rate) All Services, components Status: 31 AFC-certified, 7 finalizing cert process Practicum hours Employment opportunities following certification

    14. Financial “Roadshows” Purpose: to assist installation commanders in providing financial education and resources to help their troops and families Available to installation commanders by request at no cost Tailored to the needs of the installation* Roadshows feature: Financial/Motivational Keynote speakers General session presentations & breakout workshops Exhibit Hall/Display booths One-on-one financial counseling (PFC) “Leave behind” teams Practicum/employment support for Spouse Fellows pursuing AFC certification Installations encouraged to utilize all installation resources Family Centers, Commissary/Exchange, MWR, Legal Services, Chaplains, Child Development/Youth Centers, Schools, Banks and Credit Unions

    16. Take Five: What I Wish I Had Known About Personal Finance Better Than a Budget: Develop a Spending Plan That Will Keep You On Track The Perils of Plastic: Avoid Drowning in Debt... Charge Wisely! Dream Big - Plan Now! Make Your Ideal Retirement a Reality Pay Yourself First: Why You Should Sign Up for the Thrift Savings Plan Today Have You Fed Your Pig Today? Simple Tips for Saving & Investing Ready for Everything? Insurance Essentials for the Service Member With or Without a Family The Wheels You Want: Successful Car-Buying Strategies Home, Sweet Home: Strategies for Home-Buying and Protecting Against Foreclosure You’ve Earned It! Making the Most of Your Military Benefits Before You Take Off: Financial Planning for Deployment Don’t Lose It! How to Protect Yourself Against Identity Theft

    18. FINRA Military Financial Confidence Survey Released 19 February 09 Purpose: capture military’s attitudes/perceptions about retirement/finances Most pressing financial issues:

    19. FINRA Military Financial Confidence Survey

    20. Great News! Military Money magazine Fall 2007 Americans Well-Informed on Automobile Retailing Economics (AWARE) reports: “America’s military personnel are particularly prepared for this major financial event in their lives, more so than Americans in general….they are more likely than the average consumer to understand the process of buying and financing a vehicle, and to spend time researching their options”

    21. How Defense Credit Unions Can Help Continue to provide innovative, low cost products & services Incentivized Savings programs (Military Saves?), loan products, ATM fees; SHORT TERM LOANS (to replace payday lending alternatives) Be accessible Be proactive in providing educational services Step up financial educational opportunities Meet with installation/unit leadership Know your installation Personal Financial Manager Attend events, clinics, picnics (Ask about Financial Roadshows at your base) Make appropriate referrals Military One Source, other DoD financial partner resources Know, understand Service members and families Local demands, stresses of deployment Unique challenges

    22. Join us to help Service members and Families make sound financial decisions. Thank you for your 46 years of service to our Military!

    23. Questions? CDR Dave Julian Director, Office of Personal Finance David.julian@osd.mil 703-908-6236

    24. Financial Readiness Partners

    25. Talent Amendment Predatory Lending Law Regulation went into effect October 2007 Report due to Congress April 2008 Implementation status Recommendations for statutory, legislative changes Regulation capped at 36% Payday loans Vehicle Title Loans Refund Anticipation Loans SASC concerns: installment loans & state enforcement

    26. Report Findings Regulation has had desired impact Limited access to storefront payday and vehicle title loans Very few cases of “morphing” products to work around law\ Serrvice members did not appear to be left without options Sources of high cost installment loans are much more limited around military installations Internet is problematic Remaining source for covered loans Source for high cost installment loans Alternative loans are available and in use Available in excess of 135 installations through banks/CU’s

    27. Report Conclusions & Recommendations Implementation has been successful No further legislation or regulation necessary at this time Recommendation: change definition of covered borrower to align with DMDC definition of “dependent”

    28. Report Recommendation Revise the definition of the covered borrower to coincide with the definition used to populate the DEERS database Current definition in the regulation reads the same except for an individual who receives 50% of income from a Service member for 180 days prior to receiving the loan Cannot include this individual in any database DEERS definition: father, mother, father-in-law, mother-in-law who receive 50% of income from a Service member for 180 days Change will allow for lenders to verify covered borrowers through a database rather than through a “safe harbor” statement

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