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In the Military and in Money Trouble? How Bankruptcy Can Save Your Security Clearance and Your Job

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Security clearances are mission critical in the military

Protect your security clearance by managing your money carefully

Image source: The National Guard via Flickr Creative Commons

If you're in the military, a security clearance can be the key to getting an assignment you want, keep you on track for promotions and offer opportunities in the private sector once you separate from the Armed Forces. Losing your clearance can cause your career to crash and burn and money troubles are one issue that can put it at risk. If you are one of the many military members serving in North Carolina and are experiencing financial stress, we offer tips today to protect your clearance and your livelihood.

If you're not yet in the Armed Forces, but are considering a career in the military, any credit problems can derail your hopes of getting a position that requires a clearance. Even many basic positions require a low-level security clearance. Any position that requires (or permits) access to sensitive information can require an enhanced top secret clearance – including Army Special Forces, Navy Seals and positions as translators or in intelligence. Defense contractor and civilian contractor positions routinely require these types of clearances as well.

If you are already in the military, your clearance will be reviewed periodically and, in either case, money problems can derail your chances at getting (or keeping) the job you want. So why do financial issues matter so much to the government? In a word: vulnerability. If you're struggling with money matters, you may be open to corruption or bribery. Even if you would never, ever consider taking money for secrets, the mere presence of excessive debt is enough to cast doubt and the military just can't take that risk. If you have a clearance and want to keep it, here are some steps you should take:

#1 Monitor your credit report – Two or three times a year, pull your credit report from all three agencies - or sign up for a low-cost monitoring service – and make sure you have any inaccuracies corrected and any incidences of identity theft cleaned up. Get any unauthorized credit checks cleared off because too many inquiries can hurt your credit rating.

#2 Get credit counseling – If you're struggling to stay on track financially and are behind on some of your bills or getting close to maxing out credit cards, consider signing up for credit counseling. There are a number of organizations that offer free or low-cost credit counseling services to military members.

Military serving in Afghanistan

Protect your security clearance by keeping your credit report clear

Image source: isafmedia via Flickr Creative Commons

#3 Set up payment plans – If you're behind on credit cards or medical bills, making payment arrangements with your creditor is one way to get a grip on past-due balances so your credit won't continue to take a hit. And if there are any questions about your accounts, you can demonstrate that you have made arrangements and are addressing your debt dilemma. This will count for a lot.

#4 Bankruptcy can save your job – For a significant amount of debt that modest military pay won't allow you to service, bankruptcy may be your best option. Members of the Armed Forces don't serve for the money, so if you get in over your head with bills, you may struggle to recover and taking a second job isn't an option. If a major life event caused your money woes, such as divorce or an accident or illness of you or a loved one, a bankruptcy to clear out your back debts will not reflect poorly on you and will likely allow you to preserve your clearance.

The bottom line is that extreme debt doesn't have to wreck your clearance and career. However, if you have lost control of your spending habits and continue to make poor money management choices, in the long run, you could end up in trouble and out of the military. Don't let it get to that point. Call now for a free consultation at the law offices of John T Orcutt about getting your debts under control once and for all.

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