Many military families are all too familiar with Temporary Duty Assignments. For those of you who are not familiar, Temporary Duty Assignments can be viewed as a “business trip” or “mini-deployment” for service members. The duration of a Temporary Duty Assignments typically ranges between a couple of days to a couple of months.
All branches of the military have slightly different acronyms (TDY, TAD) for Temporary Duty Assignments. Also, regulations and per diem rates are going to vary based on the military personnel’s branch of duty, occupation, and location.
Although there are going to be differences in your Temporary Duty Assignment, chances are you will be able to budget for your TDA using one of the three techniques (or a combination of the three) described in this article.
Financial Expenses to Consider for Temporary Duty
- Entertainment/Miscellaneous Expenses
Finances at Home
Your family’s finances will be different when the service member is on temporary duty. You will need to take these difference under consideration when budgeting for a Temporary Duty Assignment.
Possible Extra Expenses
- Child Care- if the service member typically cares for the children while the other spouse works.
- Food Expenses- the spouse left at home to look after everything will probably be a little… exhausted, and may buy more convenience foods or restaurant meals.
- Car Expenses- the service member will not be driving his/her car and therefore the family’s gasoline and car maintenance expenses should decrease.
- Food/Utilities- with one less person living in the house, food and utility expenses may decrease slightly.
Three Strategies to Budget for a Temporary Duty
Finance Now, Pay Later
This strategy has you placing all Temporary Duty Assignment expenses on your GTC or personal credit card. Once you are reimbursed for your expenses, then you pay off the credit card.
- Requires Minimal Planning
- Your Savings/Checking Accounts are not immediately impacted
- Some expenses (typically airline tickets, lodging, rental car) are required to be placed on your GTC, so you will be using it anyway.
- Possibility of your expenses being greater than your reimbursement. If you spend more than your per diem, you will end up with a lower reimbursement than your credit card bill.
- If you do not have a GTC and put it on a personal credit card, you will be dealing with interest rate charges while you wait for your reimbursement
- Makes it difficult to be aware of your exact expenses
- With the ever-changing rules and regulations of what can and cannot go on the GTC and what is and is not reimbursed, you need to be fully aware of all rules and regulations.
Temporary Duty Fund/Savings Account
This strategy has you using your money out of a fund you specifically saved for your temporary duty or out of your general savings account. Once you are reimbursed, that money is yours to replenish your savings or spend as you see fit.
- You can budget before even leaving for your TDY with the amount in your bank account.
- You can withdraw cash from your bank account to give yourself a daily or weekly “allowance” to keep track of your spending.
- You may have very little notice of an upcoming temporary duty and it may not be possible to save the extra money in a short amount of time.
- Your family may need your savings for another expense, such as an emergency car or house repair while you are on temporary duty.
Cash Flow Expenses
This strategy has you include the temporary duty expenses with your monthly budget and you pay them out-of-pocket, just as if it was another monthly expense. Once you are reimbursed, that money is yours to spend as you see fit.
- Does not impact your savings account
- Your reimbursement will seem like a “bonus” because all of your expenses have already been paid .
- You may not have enough “wiggle room” in your monthly budget to allow for the extra expenses.
- For most families, it wouldn’t be practical to pay for airfare and 30 nights in a hotel with your monthly budget.
How Do We Budget For a Temporary Duty?
We use ALL three methods! Talk about confusing!
My husband has a Government-issued Travel Card (GTC) and regulations force him to place airline tickets, lodging, and rental cars on it. Therefore, we are forced to use the “Finance Now, Pay it Later” method. Fortunately, with the GTC we don’t have to worry about interest rate or making minimum payments because none of it is due until he receives his reimbursement.
We use the Savings Account method for larger expenses we know for certain will be reimbursed, but we do not have much control over the price. For example, on my husband’s current TDY we knew ahead of time the taxis to/from the airport would not take credit cards, but would be $50+ each way. So we took it from our savings account and once we are reimbursed it will be refunded back into our savings.
We use the Cash Flow method for all expenses that we have more control over how much is spent. Read: Food and Entertainment. These are the expenses during your temporary duty assignment that is either going to break you or can leave you with a nice little profit.
We budget my husband’s food and entertainment expenses in our monthly budget. Based on my husband’s temporary duty location, we determine an appropriate “weekly budget.” Typically we will overestimate food expenses to allow some room for entertainment.
Current TDY Budget
My husband’s current temporary duty is on a fully functioning overseas military installation. Therefore, we knew he would have access to a commissary, dining facility and most likely his lodging would have a mini-fridge and coffee maker (he lucked out with a full kitchen). We figured his expenses would be $100/week with an additional $100/month cushion for incidentals.
Our monthly budget can easily absorb an extra $500 expense and really it wasn’t a full $500, because my expenses at home were $300 less with him absent (food and his commuting to work expenses).
My husband simply withdraws $100 from the ATM every week to cover his expenses. This keeps it easy to track his expenses and keeps us on the same page. So if for some reason we are not in communication with each other for a few days or weeks, we know there should not be any “surprise” ATM withdrawals.
Why Do We Budget for Temporary Duty Assignments?
We budget this way for several reasons. First the regulations of the GTC seem to always be changing. Therefore, we do not want to run the risk of making an incorrect charge on it. Also, the GTC is in my husband’s name. Therefore, it is debt in his name and we do NOT want debt. This is why we only use it when it is required to do so.
We also know by using cash we are aware of every single dollar that is spent. Plus, cash makes us more mindful of our purchases, so we use cash to limit expenses.
By budgeting my husband’s temporary duty this way, we know the full per diem pay will be going to pay down our mortgage! It should be an extra $2000! YAY! Takes a little bit of the sting away from him being gone for so long.
Tips to Reduce Temporary Duty Expenses
- Use Cash
- Give Yourself a Weekly or Daily Budget
- Eat Where it is Free and Cheap
- Free Breakfast at your hotel?
- Pick up breakfast, snacks, and beverages at the commissary
- Eat at the dining facility
- Pick up a pre-made sandwich or salad from the commissary (cheaper than fast food)
- Personal Supplies
- Laundry: If your temporary duty is less than a couple of weeks, include a couple of All-in-One laundry detergent/dryer sheets in your luggage.
- Pack pain relievers or other over the counter medications you use frequently.
- Pack small bottles of shampoo, soap, shaving cream, sun block, etc.
- Look into discounted trips offered by MWR/ITT/Outdoor Rec, etc.
- Bring a book and a few movies with you
Financially preparing for a temporary duty will not only avoid extra financial stress but will also allow you to minimize your expenses. By limiting your expenses through budgeting, you will create “extra” money from your per diem rate, to be put towards your financial goals. Wouldn’t it be great to put an extra $200 or $1000 towards your financial goal?
How does your family budget for Temporary Duty Assignments (or business trips)?
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