Uncertainty is stressful — especially when it comes to your paycheck. With the threat of a government shutdown, for many servicemembers, military families, and federal employees the big question is: What does this mean for our pay and benefits? Here are some insights on what you can expect and how you can manage your finances if your pay or benefits are delayed.
What Happens to Military Pay and Benefits During a Government Shutdown?
Household finances could be a worry, if you haven't prepared ahead of time for financial hurdles. Planning can make a big difference in how you are able to handle any challenges you might face when the income, programs, benefits, and resources you count on are at risk. Here are some of the situations you may experience during a government shutdown:
- Active Duty Pay: Servicemembers are still required to report for duty, but paychecks may be delayed until Congress approves funding. Coast Guard servicemembers, who fall under the Department of Homeland Security rather than the Department of Defense, may face longer delays in receiving back pay.
- Guard & Reserve Drill Pay: Drills and training could be canceled or postponed, which may impact pay.
- Civilian DoD Employees: Many workers may be furloughed without pay until funding resumes. Some “essential” employees may still be required to work but won’t be paid until the shutdown ends.
- Military Benefits: Programs such as TRICARE and VA Health Care will continue, though some services may be limited or delayed. Military retired pay, Survivor Benefit Plan (SBP) payments, and VA benefits — including compensation, pension, education, and housing — will not be affected.
- Life Insurance Coverage (SGLI & VGLI): SGLI coverage continues as usual, and VGLI has a 60-day grace period before any lapse in coverage. If a death claim needs to be submitted during a shutdown, processing may take longer due to limited staffing, but benefits will still be paid.
- Family Services: PCS moves, tuition assistance, and certain base services may be put on hold. However, commissaries, exchanges, and many MWR programs typically remain open. DODEA schools are expected to continue classes, though extracurricular activities and sports may be limited. Child care is generally handled on a case-by-case basis, with mission-essential care prioritized.
- Social Security Benefits: Payments for eligible beneficiaries will continue. Applications for new benefits and other administrative functions may be delayed due to reduced staffing.
Having savings available to get you through this period is essential to maintaining your financial equilibrium. It can also be a relief to know that you don’t have to stress over finding money to make payments that are due, such as bills, your mortgage, and food shopping.
How Can Military Families Prepare Financially?
Here are steps you can take now to prepare for a government shutdown, along with resources that may help you weather it.
If Your Pay Stops, Do This
Don’t let your bills pile up. Make one or two quick calls to the businesses you use can help buy you time and reduce stress. They may even offer suggestions that will help you save money on your accounts or services.
- Prioritize Monthly Bills: Cover your housing, utilities, food, and transportation first. Let less critical expenses wait (i.e., subscriptions and non-essentials).
- Check with Your Financial Institution: Many military-focused banks and credit unions are offering temporary relief programs during the shutdown, such as early pay options, zero-interest loans, or payment deferrals. Contact your bank or credit union directly to learn more about eligibility. Common programs include:
- Contact Creditors Early: Many landlords, lenders, and utility companies have hardship or forbearance programs, but you need to ask before payments are missed.
- The Servicemembers Civil Relief Act (SCRA) provides legal and financial protections for active-duty servicemembers and their families. These include interest rate reductions on certain debts, eviction protection, foreclosure postponement, and more. If you’re experiencing financial hardship due to the shutdown, let your creditors know that you qualify for SCRA protections. Learn more through Military OneSource.
- Tap Into Relief Organizations: These organizations may provide emergency grants or loans:
- Lean on Your Community: Food banks, installation spouse networks, and local nonprofits often step in with groceries, childcare, or household support during times of need. Commissaries, Exchanges, and installation programs also sometimes extend credit or discounts during shutdowns.
- Need help right now? Dial 2-1-1 to be connected with local community and government assistance programs in your area. You can also visit Feeding America to find nearby food banks and pantries.
- Look for Short-Term Income: Babysitting, pet care, tutoring, or part-time work can help fill small financial gaps quickly.
- Consider Getting a $5,000 CAP Loan: If your paycheck is delayed, the Armed Forces Mutual $5,000 CAP Loan can give you breathing room. Available exclusively to E4-O5 and recently separated Veterans, this personal loan can be used for whatever you need most — whether that’s rent, groceries, car repairs, or simply keeping your family on track until your regular pay resumes.
Preparing for the Unexpected Going Forward
Once your pay resumes, as you’re getting back to life as usual, use what you learned during the shutdown to start planning for the future so the next shutdown (or emergency) feels less overwhelming:
- Start an Emergency Fund (Even Small): $20 a paycheck adds up faster than you think.
- Build a “Bare-Bones” Budget: Know the minimum you need to cover essentials, so you can switch to it quickly if needed.
- Create a Financial Safety Net: Explore tools like allotments, savings accounts, or insurance coverage that can cushion you in future disruptions.
- Revisit Your Support Options: Get familiar with where to go for help — relief societies, spouse networks, installation services.
We Can Help
Shutdowns are unpredictable, but not new. Building savings, trimming expenses, and knowing where to turn for support can make your family more financially resilient, no matter what happens in the government.
Remember: You’re not alone. Armed Forces Mutual provides financial guidance to help military families stay secure through every stage of service. Subscribe now for access to the premium content in our Learning Hub, and check out our resources, such as our Financial Readiness and Building Budgets guides.