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Net Worth Strongest in Military Families

November 16th, 2018

FORT WORTH, Texas – Career military families who work with a financial advisor are amassing financial assets that are significantly larger than those accumulated by their do-it-yourself counterparts, according to the First Command Financial Behaviors Index®.

Second quarter 2018 results of the First Command Financial Behaviors Index® reveal that these middle-class military families (commissioned officers and NCOs in pay grades E-5 and above with household incomes of at least $50,000) report average current holdings in retirement and savings accounts of $262,710. That compares to just $82,708 for military families without an advisor.

Survey respondents with financial advisors are more likely than their DIY counterparts to own a retirement savings account (66 percent versus 52 percent) and a long-term savings vehicle (56 percent versus 30 percent). They are also putting more dollars into these accounts. They report average monthly investments of:

  •  $995 for retirement savings. That compares to $545 per month for those without an advisor.
  • $889 for long-term savings. Those without an advisor report $378 per month.

Retirement confidence is also higher among those who work with an advisor. Forty-seven percent of those with a financial coach are extremely or very confident in their ability to retire comfortably. That compares to just 24 percent of military families without an advisor.

“Our research has consistently revealed that saving for retirement and other long-term needs can bolster feelings of financial confidence and security,” said Scott Spiker, chairman/CEO of First Command Financial Services, Inc. “Military families who have a financial plan with a financial advisor typically feel more certain in the pursuit of their long-term goals. Confidence often aligns with a strong net worth position, which is reinforced by savings and other positive financial behaviors.” 

Military families with financial advisors are also feeling more positive about their near-term finances. Forty-seven percent of them say they feel extremely or very confident their financial situation will improve in the next year. That compares to just 33 percent of those without an advisor. These families are putting more dollars per month towards short-term savings and paying down debt. They report average monthly contributions of:

  • $673 for short-term savings. That compares to $379 for those without an advisor
  • $2,165 to pay down short- and long-term debt. Those without an advisor report $1,769 per month.

Strong savings behaviors during the second quarter helped generate an overall Index score of 156. (The Index is set to a benchmark of 100, which was assigned when the Index was launched in 2008.) The Index score for families who work with a financial advisor is 163. For those without an advisor, the score is 121.

“Personal financial coaching is a time-tested way to improve outcomes,” Spiker said. “Career military families who work with a financial advisor are more likely to save more and feel more confident about their finances than their colleagues who do not work with an advisor. Working with a financial coach is an ideal way for military families – and military spouses who often play a lead role in managing their household finances – to make the most of their pay and benefits in their continuing pursuit of long-term financial security.”

About the First Command Financial Behaviors Index®

Compiled by Sentient Decision Science, Inc., the First Command Financial Behaviors Index® assesses trends among the American public’s financial behaviors, attitudes and intentions through a monthly survey of approximately 530 U.S. consumers aged 25 to 70 with annual household incomes of at least $50,000. Results are reported quarterly. The margin of error is +/- 4.3 percent with a 95 percent level of confidence. http://www.firstcommand.com/fbi/

About Sentient Decision Science, Inc.

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

First Command Financial Services and its subsidiaries, including First Command Financial Planning and First Command Bank, coach our Nation’s military families in their pursuit of financial security. Since 1958, First Command Financial Advisors have been shaping positive financial behaviors through face-to-face coaching with hundreds of thousands of client families.

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