The First Command Financial Behaviors Index® reveals that more than half of middle-class military families feel confident their financial situation will improve in the next year
The First Command Financial Behaviors Index® reveals that several key measures of confidence have been improving. Third-quarter results show that more than half of middle-class military families (commissioned officers and senior NCOs in pay grades E-6 and above with household incomes of at least
These upticks in confidence helped propel the Index’s attitudes sub-index ahead 8 points to 136 and push the overall Index score to a record-high of 132 for the third quarter. The Index is set to a benchmark of 100, which was assigned when the Index was launched in 2008.
While overall financial confidence is growing, military families continue to worry about sequestration. September survey results reveal that 76 percent of military respondents feel anxious about cuts to defense spending. That’s up 14 points from the end of the first quarter. In contrast, concern remains muted in the general population with about two out of five civilian respondents expressing anxiety.
Roughly four out of five military families expect to be financially impacted by sequestration, and they are continuing to take action through a variety of positive behaviors. Half of September survey respondents say they are increasing the amount they are saving.
Monthly savings rates are being positively impacted by the support of a financial advisor. During the third quarter, military families working with a financial advisor were considerably more likely to save – and put away more dollars – than their do-it-yourself counterparts. Their monthly savings rates are:
- 91 percent for short-term savings. This compares to 68 percent for those without an advisor. Monthly median contributions for savers in the two groups are
$500and $490, respectively.
- 84 percent for retirement savings. This compares to 66 percent for those without an advisor. Monthly median contributions for savers in the two groups are
$458and $350, respectively.
- 79 percent for long-term savings. This compares to 34 percent for those without an advisor. Monthly median contributions for savers in the two groups are
$499and $250, respectively.
Looking ahead, most military members expect to continue their savings behaviors in the coming months. However, servicemembers with a financial advisor are more likely than those without to anticipate increasing their monthly savings amounts (39 percent versus 28 percent).
“As military families navigate the uncertainties of sequestration and defense downsizing, they are taking actions that help them feel more optimistic about their financial security,” said
About the First Command Financial Behaviors Index®
Sentient Decision Science was commissioned by First Command to compile the Financial Behaviors Index®. SDS is a behavioral science and consumer psychology consulting firm with special vertical expertise within the financial services industry. SDS specializes in advanced research methods and statistical analysis of behavioral and attitudinal data.
About First Command