Don’t Forget the Federal Budget Can Impact Pay

Once again, our federal government is reaching the start of the new fiscal year and there is no indication that a federal budget will be passed before the start of the year.  This situation is not new (it’s happened in every year since 1997, and all but three years since 1977.)  Typically, Congress handles the lack of spending bills by passing continuing resolutions that funded the government until the paperwork side of the budget could be settled.  However, the last few years have included heated battles about funding, and legitimate threats that the government would shut down due to a lack of continuing resolution or spending bills.  Government shutdowns are not terribly unusual, with the last shutdown occurring in October 2013.

If our legislators fail to pass a spending bill by 1 October 2015, and it is nearly certain that they won’t, AND they do not pass a continuous resolution, then the government will shut down.    What does this mean for military families?  Unfortunately, it means that there is the possibility that military pay could be delayed.  The Pay Our Military Act of 2013, which protected military pay during the last government shutdown, was only valid for that fiscal year and does not provide any protection for this year.  The important thing to know is that if the federal government shuts down, and a new military pay protection act is not passed, then the 15 October 2015 military pay deposits could be delayed until the government reopens, and then perhaps a few days longer until the systems can be run.

When I have written about potential government shutdowns in the past, some readers have criticized me for being alarmist and creating unnecessary worries.  I think that is unrealistic, because the threat is real.  Just because it hasn’t happened recently doesn’t mean that military pay has never been delayed due to a government shutdown, and people need to be aware of the possibilities.  As I often say, “Prepare for the worst and hope for the best.

I will write more about this subject if it becomes more clear that a government shutdown is likely.  In the meantime, start thinking about how you will plan your finances if your pay is delayed.  And, please, ask questions!  The more you know, the better you can handle a crazy situation.

About the Author

Kate Horrell
Kate Horrell is a military financial coach, mom of four teens, and Navy spouse. She has a background in taxes and mortgage banking, and a trove of experience helping other military families with their money. Follow her on twitter @realKateHorrell.
  • 4M

    How does this affect privatized housing? The LES isn’t clear as to if housing gets half at mid-month and half at end of month, or all at end of month.

    If it’s half and half do they just wait until we get paid? What if it takes more than a month? Do we pay our own SGLI, Dental, and Housing obligations?

    What happens to people with allotments for repayment of military aid group loans? Do they accept a grace period for such events?

    • USFSPA Killer

      A smart troop will have at least one month’s pay deposit set aside for these annual legislative partisan battles that don’t affect such “holders of the Eagle droppings” !

      • 4M

        Well, one months pay deposit would still be shy all of those allotments, but if you meant one months gross pay then I’m in full agreement.

        I think most readers here could go six months without sweating a paycheck, but I still haven’t the faintest idea of how I’d pay rent to privatized housing, or if I’d even have to pay rent to privatized housing. Same with dental. If I don’t get paid will I have to scramble to make a payment to tricare dental before the 15th?

        I think housing could take a check, and I’ve got the number to tricare dental in my phone book for bill pay, but I’m clueless on SGLI payments.

        What about the CDC? Since its income based, and I’ll have no income, could I get s break ;)

  • Kate

    Hi friends! I apologize for the delay in responding – I’ve been trying to find some definitive answers for you. Unfortunately, even gathering my brain trust has not resulted in anything conclusive. There isn’t a lot of precedent as the last time the military wasn’t paid was decades ago.

    I’m getting ready to throw up a post that goes into what we suspect might happen, but it is all conjecture at this point. Sorry!

  • Well, one months pay deposit would still be shy all of those allotments, but if you meant one months gross pay then I’m in full agreement.