Military Deployments: Extra Money Through Savings Deposit Program

Service members deployed under hostile fire conditions may earn extra money from a high interest savings deposit program which is specifically made available because of their deployment. Executive Order 11298 was first issued in 1966 and establishes the authority for a high interest savings account for deployed service members. The Executive order specifies that deployed military members may contribute to a savings program which accrues the high interest rate of 10% per annum, compounded quarterly.

The Savings Deposit Program (SDP) is covered in DOD regulation 7000.14-R, Volume 7A, Chapter 51. The extra money from savings deposit program is not new to the military. It provided Vietnam soldiers the ability to earn extra cash through the high interest savings account when they were deployed in Southeast Asia. It was reopened during Desert Storm and offered to deployed military members. In 1996 military members deployed to Bosnia were given the opportunity to earn extra money through the Savings Deposit Program also. Deployed Military members in Iraq and Afghanistan have been offered the opportunity to deposit into the high interest savings account also.

Military deployment extra money is often important to the military family, especially the lower ranking members. While this is not actual extra money in the paycheck program, if the deployed military member can afford to add funds to this high interest savings account, there will be extra funds available when the deployment ends.

In order to be eligible to make deposits to the high interest savings account (Savings Deposit Program), service members must be receiving Hostile Fire/Imminent Danger Pay and be serving in a combat zone for more than 30 consecutive days. Service members can begin receiving the extra money through the high interest savings account by beginning their deposits on the 31st day they are in the qualifying area. Service members deployed to one of these areas can set up a special power of attorney for someone to set up an allotment to deposit the funds in the high interest savings account. The 10% interest rate only applies to $10,000 and eligibility ends on the day of departure from the eligible combat zone. Interest can continue to accrue for up to 90 days after the deployed military member leaves the zone if they choose to leave the money in the high interest savings account. Unlike other military pay earned in a combat zone, the interest earned from the Savings Deposit Program as extra money by the deployed military member is taxable.

Deployed military members or family members looking for more information on the extra money available as a result of the Savings Deposit Program can view the governing regulation at http://www.defenselink.mil/comptroller/fmr/07a/07a_51.pdf