Career military families are bullish on their economic futures despite lingering concerns about the pandemic.
Nearly eight in 10 commissioned officers and senior NCOs in pay grades E-5 and above with household incomes of at least $50,000 expect their financial situations will improve in coming year, according to the first-quarter First Command Financial Behaviors Index. Although 64 percent of military families report feeling affected by the pandemic, they have responded by remaining focused on securing and improving their household finances.
Families that work with a financial advisor report better results than those who do not:
Military families that work with a financial coach have amassed almost twice the savings and retirement assets of their do-it-yourself colleagues. Families who work with a financial advisor report average savings and retirement holdings of $207,422, about $98,000 more than those without an advisor.
Eighty-one percent of families that work with an advisor report feeling extremely or very confident in their ability to retire comfortably, according to the index. Only 42 percent of military families without an advisor report experiencing similar confidence levels.
The alignment of positive behaviors and confidence also is true for the near term. Families with an advisor contribute more to short-term savings than those without an advisor — $710 per month vs. $415. And 83 percent believe their financial situation will improve over the next year. That compares to 44 percent of those who do not work with an advisor.
Military families that work with a financial advisor are more prepared for emergency expenses related to the pandemic. The index reveals that 62 percent report having three months or more of savings to fall back on to cover household monthly expenses. That compares to 53 percent of military families without an advisor.
Looking ahead, military families who work with an advisor are more likely than their DIY counterparts to say they intend to increase their monthly contributions to savings and investments.
“Military families who work with a financial advisor are better prepared for the financial impacts of the pandemic and feeling more confident in their financial future than their do-it-yourself colleagues,” said Mark Steffe, president and CEO of First Command.
“Their positive savings and investing behaviors are helping them enjoy feelings of financial confidence today and pursue retirement and other long-term goals they set for tomorrow.”