Being a soldier is hard, no question. Managing a military family's finances is no picnic either. But just in time for Veterans Day, efforts are underway to expand financial protections for service members.
The Military Lending Act, which took effect in 2007, places some limits on small-dollar, short-term lending practices, but lenders have found many ways around the law. The Defense Department has proposed beefing up the act, known as the MLA, so that it applies to "all forms of payday loans, vehicle title loans, refund anticipation loans, deposit advance loans, installment loans, unsecured open-end lines of credit, and credit cards," the announcement said.
Read MoreObama administration seeks more protection for military borrowers
The signs of stress on military families are abundant. Many service members are anxious about the possible effects of sequestration (or spending cuts) and defense downsizing, with 55 percent of military families worried about job security, compared with 6 percent of the general population, according to a survey released in September by First Command Financial Services.
Unemployment among military spouses is also well above the national average, with 30 percent joblessness among spouses aged 18 to 24, further stretching military families' budgets. Partly that's because military families relocate much more than the average family. Holly Petraeus, former wife of retired Gen. David Petraeus, said in congressional testimony that their family moved 24 times in 37 years.
Members of the military are also preyed upon by fraudsters using their own military connections to establish trust. The Securities and Exchange Commission said last year it halted an alleged scheme created by a former Marine whom it accused of investing only a fraction of the money he received from would-be clients, spending the rest on fancy cars, a Hollywood mansion and more.
Not surprisingly, service members, particularly those who are younger or more junior, are more likely than the general population to take out high-cost, short-term loans and credit lines, especially since payday lenders, pawn shops, and used car dealers often line the streets outside military installations.
In a Defense Department survey, 41 percent of enlisted service members said they or their significant others had used small-dollar lending in the previous 12 months, including payday loans, loans from pawn shops, advances on bank deposits and cash advances on credit cards. Among all members of the military, 35 percent used those products, versus 30 percent of the general population, according to the Financial Industry Regulatory Authority. Millennials in the military were more likely to go that route than their older counterparts.
"Sometimes it's easier for those service members as they taxi off post to run into the payday lender and find their financing that way. They just don't have the information to know what's available to them," said Jerry Quinn, manager of Wells Fargo's Military Affairs Program and an Army reservist. The military does offer financial education at certain times, like when a unit mobilizes, he said, but at that point, soldiers have many other things on their minds. "Worrying about their car payments might not be their top priority when they are counting rounds and making sure their protective vest is set up right," he said.