First Command Reports: Military Families Feeling Upbeat About 2023 Economy
January 31, 2023
FORT WORTH, Texas – At a time when many Americans are concerned about a possible economic downturn in 2023, career military families are feeling upbeat about their financial futures.
November survey results of the First Command Financial Behaviors Index® reveal that 73% of career military families (commissioned officers and senior NCOs in pay grades E-5 and above with household incomes of at least $50,000) report feeling extremely or very confident their financial situation will improve over the next year. That compares to just 33% of the general population.
Notably, confidence has risen in military families (up seven points from November 2021) and fallen in civilian families (down six points from November 2021).
Military families are feeling significantly more confident in their long-term finances, too. The Index reports that 75% feel extremely or very confident in their ability to retire comfortably. That compares to just 29% of the general population.
Military families have good reason to feel optimistic about their finances. They are putting away more dollars for the future than the broader U.S. population. That’s particularly true for military families who receive financial coaching from a professional advisor. During the third quarter their average monthly contributions to savings and retirement accounts totaled $3,290 per month versus $1,395 for their colleagues without an advisor. In the general population, average monthly contributions were $1,360 for those with an advisor versus $1,136 for those who go it alone.
These savings behaviors are also reflected in net worth. During the third quarter, military families who worked with an advisor reported average long-term savings and retirement holdings of $242,403, almost $36,000 more than those without an advisor. The general population showed a similar trend.
“Compared to their civilian counterparts, career military families are well positioned to deal with the financial uncertainties of 2023,” said First Command President/CEO Mark Steffe. “Through strong savings and investing behaviors, these families are growing their net worth. And those who work with a financial advisor are feeling particularly optimistic. Eighty-one percent say they feel extremely or very confident their financial situation will improve in the next year. That compares to just 66% for those who are not working with an advisor. Families who partner with a coach are saving more and feeling more confident in the future than those who go it alone.”
Concerns about the economy are notably higher in families who are not working with a financial advisor. The third quarter Index report shows that more than half of military families without an advisor (59%) said the state of the economy was a top concern. That compares to just 36% of those who receive financial coaching and guidance from a professional advisor. The Index identified similar differences between the two groups for the:
- Cost of gas (54% of those without an advisor versus 29% of those who work with an advisor).
- Cost of everyday goods (44% versus 32%).
- Ability to retire comfortably (33% versus 29%).
The general population showed a similar trend.
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 and debt payments. These positive intentions helped drive the latest quarterly Index score to 203 for those with an advisor versus 140 for those without an advisor. The overall score is 193, up 12 points from the previous quarter.
The Index is set to a benchmark of 100, which was assigned when the Index launched in 2008.
About First Command
First Command Financial Services and its subsidiaries, including First Command Brokerage Services, First Command Advisory Services 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.