WASHINGTON (Army News Service, Sept. 10, 2015) — Army Emergency Relief, or AER, has just made it easier for junior Soldiers to request interest-free loans and grants.
Effective Sept. 9, many junior Soldiers will be able to apply for emergency financial assistance without involving their chain of command.
The new policy pertains to privates through corporals and specialists, who have completed Initial Entry Training and have a minimum of 12 months service or have completed Advanced Individual Training – whichever comes first. They will no longer be required to request an AER loan or grant by going through their chain of command.
Charles Durr, who serves as assistance chief for AER, said the change was brought on because AER feels that first year of service is essential in establishing trust between leader and a service members, and it’s a kind of integration period where good financial fitness is being developed.
Another reason for the policy shift is because AER has seen about a 35-percent decline over the last six years in the number of active-duty Soldiers seeking assistance, Durr said.
During calendar year 2014, AER had 35,000 requests for assistance and disbursed nearly $46 million to help active-duty Soldiers set up homes, repair autos and take care of expenditures that were unforeseen, he said.
“We attributed the decline in asking for help to what was an intimidating, time-consuming process in that Soldiers would have to go to the squad leader, the squad leader to the platoon sergeant, the platoon sergeant to the first sergeant and so on,” Durr said. “We think our Soldiers deserve to be afforded a streamlined process for resolving any of their short-term financial issues.”
Durr said that no-interest loan requests and grants were down for fear of a perceived stigma that’s associated with asking for help and being labeled as “bad Soldiers” because they had financial issues. Some Soldiers felt their need for financial help would threaten future promotion and selection for leadership positions or that they might lose their security clearances.
Direct access to AER has been gradual. In 2013, sergeants first class were given direct access to AER without going through their chain of command. After a further worldwide assessment, Jan. 1, 2014, AER extended direct access to sergeants and above, so it’s been an incremental change over time, Durr said.
The retired command sergeant major said when Soldiers had to move through the laborious and embarrassing process of the chain of command, they would seek out alternatives like payday lenders for emergency financial assistance. Then they’d be stuck with high-interest loans.
Ways in which AER has assisted Soldiers and their Families in the past include initial deposits for utilities needed for establishing a new household, Durr said. He added that AER can also assist with the purchase of washers, dryers, beds and other furniture instead of renting-to-own.
“We can help with auto replacement, when it’s not financially sound for a Soldier to continue to dump money into auto repairs that cost more than a vehicle is worth,” he said.
In mid-July, AER opened a new category of assistance – minor home repair for those Soldiers, who choose to buy homes rather than rent. This new category is designed to cover repairs on interior, exterior wiring and the like which aren’t covered by basic home-owners’ insurance.
“We have a significant investment portfolio – so we’re postured for disasters, payless paydays, things of that nature… and this is the Soldiers’ fund, so they should be able to draw from it as needed,” Durr said. “We continue to look for ways to meet the emergency financial needs of our Soldiers and their Families, so we have to be an organization that evolves as the Army changes.”
AER was established in 1942 with $1.5 million in seed money from the American Red Cross and $12 million from Irving Berlin’s musical, “This is the Army.” It was incorporated as a non-profit organization to meet the emergency financial needs of a rapidly expanding Army.
The secretary of war and the Army chief of staff established AER on Feb. 5, 1942, in Washington, D.C. AER was placed under the Army service commands with more than 600 sections worldwide at the height of World War II.