MILITARY LIFE MONEY MOMENTS · STANDWATCH
Deployment Money Guide
A deployment changes your pay, your taxes, and your savings options, often in your favor, if you know what to look for. This guide lays out the programs and protections that apply, how each one works, and where to verify it. It is information, not advice. What fits your situation is your call, and your finance office has the final word.
At a glance
Your pre-deployment money checklist
The goal is simple: set things up before you leave so nothing slips while your attention is elsewhere.
- Set up allotments and autopay so every bill is covered on time while you are gone.
- Put a power of attorney in place so someone you trust can act on your accounts if needed.
- Review your SGLI coverage amount and confirm your beneficiaries are current.
- Build or top off an emergency fund you can reach from anywhere.
- Confirm who manages the household money, and that they can log in and reach the accounts.
- Check that direct deposit, your mailing address, and your myPay login all work before you go.
- Note your deployment start date. It drives several of the benefits below.
The DoD Savings Deposit Program (SDP): the 10% account
The SDP is a Department of Defense savings account that pays a guaranteed 10% annual interest, compounded quarterly, on up to $10,000, available while you are deployed to a designated combat zone. That rate is not available in a normal savings account.
Who can use it
Service members deployed to a designated combat zone or qualified hazardous duty area, receiving Hostile Fire or Imminent Danger Pay, for more than 30 consecutive days, or for at least one day in each of three consecutive months.
How it works
- Open the account through your finance office at your deployed location and deposit your unallotted pay, up to $10,000.
- Interest keeps accruing for up to 90 days after you leave the combat zone.
- The account pays out by direct deposit about 120 days after your deployment ends. You can request funds earlier through myPay.
- Amounts over $10,000 do not earn the 10%.
Whether SDP fits your plan, and how much to deposit, is your decision. This is how it works so you can weigh it.
Source: Defense Finance and Accounting Service, dfas.mil/MilitaryMembers/sdp, and Military OneSource. Verify current terms before you enroll.
The SCRA 6% interest cap
The Servicemembers Civil Relief Act can cap your interest rate at 6% on debt you took on before you entered active duty, including credit cards, auto loans, personal and student loans, and mortgages.
- It applies only to pre-service debt, not to anything you borrow after active duty begins.
- Interest above 6% is forgiven, not deferred. It cannot be added back later.
- To claim it, send each lender a written request with a copy of your orders. You can request while on active duty or up to 180 days after release.
- For mortgages, the cap continues for one year after active duty ends.
- It covers active duty and activated National Guard and Reserve members on qualifying federal orders. The SCRA also allows some leases to be ended without penalty when you deploy or receive PCS orders.
Source: U.S. Department of Justice, justice.gov/servicemembers, and the CFPB. A military legal assistance office can help with your specific debts.
The Combat Zone Tax Exclusion: your pay, tax-free in zone
For any month in which you spend even one qualifying day in a designated combat zone, your basic pay for that whole month can be excluded from federal income tax.
- Enlisted members and warrant officers: all basic pay for the month is excluded.
- Commissioned officers: the exclusion is capped at the highest enlisted basic pay plus imminent danger pay, which is $11,391.90 per month for 2026.
- It is automatic. DFAS stops withholding federal income tax for qualifying months and codes the excluded pay on your W-2. Check your LES to confirm it is being applied.
- Social Security and Medicare (FICA) are still withheld, and allowances like BAH and BAS are already tax-free.
Source: Internal Revenue Service, Tax exclusion for combat service and Publication 3, Armed Forces' Tax Guide.
Deployment pay changes to watch for
Several pays can start when you deploy, and they stack on top of each other. Confirm each one on your LES.
- Family Separation Allowance (FSA): $300 per month for 2026 (raised from $250, the first increase since 2002) when you are separated from your dependents for more than 30 days by orders. It is not always automatic, check your LES and, if needed, submit DD Form 1561.
- Hostile Fire / Imminent Danger Pay: up to $225 per month for 2026 in a designated area. Imminent Danger Pay is prorated at $7.50 per day up to the $225 monthly cap, while a full qualifying month is paid the full monthly rate. Confirm current figures with DFAS or your finance office.
- Hardship Duty Pay: varies by assignment and location.
Source: Defense Finance and Accounting Service and the FY2026 National Defense Authorization Act. Dollar figures change, confirm the current amount at DFAS and on your LES.
While you are deployed: a note from StandWatch
Rates and bills have a way of drifting while your attention is twelve time zones away. StandWatch can keep an eye on your VA mortgage rate, auto loan, or savings APY for free and let you know if something moves, so nothing important slips by while you are gone. No cold calls, and we never sell your information as a lead. Setting a Watch is optional, and the decision always stays yours.
Before you deploy: two free offices to visit
Two stops on your installation can save you real money and real stress while you are gone, and both are free.
- Legal assistance (JAG): get a will and a power of attorney before you leave, so someone you trust can handle your banking, bills, and paperwork while you are deployed. Legal assistance attorneys draft these at no cost, and you can use any branch's office. Find one with the Armed Forces Legal Assistance locator at legalassistance.law.af.mil.
- Your family support center: a certified personal financial counselor can help you set up the Savings Deposit Program and allotments, build a deployment budget, and plan around the extra pays. Army: Army Community Service (ACS). Air Force and Space Force: the Military and Family Readiness Center (M&FRC). Navy: Fleet and Family Support Center (FFSC). Marine Corps: Marine Corps Community Services (MCCS). Coast Guard: Health, Safety and Work-Life (HSWL). Or call Military OneSource at 800-342-9647.
If an emergency hits your family during the deployment, your branch aid society offers interest-free loans and grants: Army Emergency Relief, Navy-Marine Corps Relief Society, Air Force Aid Society (which also serves the Space Force), and Coast Guard Mutual Assistance.
Source: U.S. Armed Forces Legal Assistance, Military OneSource, and each service's family readiness program.
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Frequently asked questions
Is the Savings Deposit Program worth it?
The SDP pays a guaranteed 10% on up to $10,000 while you are deployed to a designated combat zone, a rate not available in normal savings accounts. Whether to use it, and how much to deposit, is your decision. Confirm current terms at DFAS.
Does Family Separation Allowance start automatically?
Not always. Check your LES in the first weeks of separation and follow up with finance if it has not started. The form is DD Form 1561, and the 2026 rate is $300 per month.
How do I get the SCRA 6% interest rate?
Send each lender a written request with a copy of your orders. You can request while on active duty or up to 180 days after release. It applies to debt taken on before active duty, and interest above 6% is forgiven.
Is my deployment pay really tax-free?
Basic pay earned in a designated combat zone is excluded from federal income tax for any month you spend a qualifying day there. Enlisted and warrant officers exclude all of it; officers are capped. It is automatic on your W-2, though FICA is still withheld. Confirm on your LES.
Do these apply to National Guard and Reserve?
Many apply to activated Guard and Reserve members on qualifying federal orders, though eligibility depends on your specific orders. Confirm your situation with your finance office or a military legal assistance office.
Sources
- Savings Deposit Program: DFAS and Military OneSource
- SCRA 6% interest cap: U.S. Department of Justice and CFPB
- Combat Zone Tax Exclusion: IRS (Publication 3, Armed Forces' Tax Guide)
- Deployment pays and Family Separation Allowance: DFAS
Figures verified July 10, 2026. Program terms and dollar amounts change over time. Always confirm the current figure at the official source and on your own LES. This guide is general information for the military community, not financial, tax, or legal advice.