You likely already know that moving can require a lot of physical, mental, and financial stress. Sometimes things happen that you aren’t prepared for, especially when you can’t really start planning until you have PCS orders in hand. This means you have to do a lot of planning, usually with only a few months' notice of where you’re headed.
In the midst of this fast-paced planning, how do you ensure you maintain financial stability? AAFMAA is here to help with some PCS planning tips and insights to add to your peace of mind.
What Is PCS in the Military?
PCS stands for Permanent Change of Station. Unlike temporary duty assignments, permanent change of station orders are longer-term assignments, generally two to four years. Broadly speaking, your orders will tell you where you’ll be moving, which is either CONUS or OCONUS.
- CONUS: Inside the continental United States.
- OCONUS: Outside the continental U.S. Includes Alaska, Hawaii, and U.S. territories.
Your orders include important information related to your authorizations and entitlements. You’ll need a copy of your orders to coordinate your military move.
Can a Military Spouse Collect Unemployment Due to PCS?
Currently, every state but Idaho, Louisiana, Ohio, and North Dakota allow military spouses who leave their jobs due to a PCS move to collect unemployment. Each of the 46 states that offer unemployment to military spouses in this situation has its own eligibility requirements.
You’ll need to check the requirements of the state you’re leaving, not the state you’re moving to. This is because you’ll be filing the unemployment claim with the state you were working in. Even if you don’t think you’ll be eligible, check anyway. Finding a job in a new area after all the adjustments that come with moving can be time-consuming and tedious. Collecting unemployment could be a great safety net to have during your transition.
8 Considerations When Budgeting for a PCS Move
1. Selling Your Home
If you are planning to sell your home before a PCS move, you can expect a significant shift in your finances. If you choose to hire an agent, you will need to closely consider the cost of repairs, legal fees, a home inspection, marketing costs, and real estate fees.
Additionally, if the market is on your side and you expect to profit from selling your home, you should also consider what you should do with the extra profit. Consider things like expanding your savings, retirement planning, supplying your child’s college fund, or putting the money toward buying a home at your next duty station. This could also be an excellent opportunity to start building your customized investment portfolio with AAFMAA.
2. Renting Your Property
You may have the opportunity to make some extra money and improve your budget by renting out your property. Consider Basic Allowance for Housing (BAH), comparable listings, and the housing market in the area before you get started.
This information will help you determine what a fair asking price is for your property and help you determine how much you will profit from renting out your property after all other expenses, such as your mortgage, are paid.
3. Getting Your Deposit Back
If you rent your current home, you likely paid a security deposit before moving in. Thisdeposit is usually refundable when you move out, so you will likely see a full or partial deposit returned to you if you took good care of the property during your stay.
Be sure to document the condition of your home when you leave it in case your landlord claims you caused any damages. For this reason, it’s also a good idea to take photos at move-in and keep a record of communication between you and your landlord. This will help ensure that if eligible, you’ll receive your deposit back, which will be helpful to have for your moving fund.
4. Moving Allowances
Luckily, the military does provide you with a moving allowance in addition to other funds, advancements, and reimbursements for things related to your PCS move. These allowances include Dislocation Allowance, Temporary Lodging Expense, Per Diem, and mileage rates. There are a few more you might be entitled to when you move OCONUS.
When you receive PCS orders and file your move appropriately, these allowances become available. A portion of them may be given before your move. However, the majority is provided as a reimbursement after you arrive at your next duty station. As you budget for your PCS move, take these allowances into consideration. Since some purchases you make will be out of pocket initially, you’ll want to make sure you can afford the expense upfront.
5. Setting Up a Rental Home
When setting up a rental home, you will need to consider your budget for a security deposit, if you will need a pet deposit, and the cost to set up utilities. You will also need to know if you should have a certain amount of rent payments saved up.
Keep in mind that every state has different laws that regulate how much a landlord can require upfront for a rental property. Therefore, it is important to check your state’s laws before you move and adjust your budget accordingly.
6. Buying a Home
Buying a house is a considerable expense. If you decide that you want to buy at your next duty station, you need to consider what your new BAH is, what type of mortgage you want, and ultimately what you can afford.
If you own your current home and plan to rent it out, can you afford to pay two mortgages? Ideally, your tenants will help cover the cost of your rental home, but you need to think about whether you can afford for it to sit empty for a couple of months if there is a gap in tenancy.
7. Travel Expenses
While creating a budget for your move, you should anticipate the cost of lodging, gas, food, and other unexpected expenses. You will need to plan for allowances covered earlier but understand that some purchases you make will initially be out of pocket. Therefore you will want to be sure you can afford to pay for these expenses upfront.
8. Insurance Fluctuations
Insurance regulations fluctuate from state to state, so it is not uncommon to see car insurance rates change after PCS. Give your provider a call after you move to update your address, and they will provide you with your new monthly rate.
We’re Here to Help
Our team of Military Mortgage Advisors are dedicated to helping AAFMAA Members obtain the best mortgage possible. We’ll work with you to determine what the best course of action is during your PCS move. Get your free mortgage assessment today or give us a call at 844-422-3622!