Economy Prompts Military Families To Reduce Financial Risks
Three out of five middle-class military consumers are cutting back on everyday spending, according to the First Command Financial Behavior Index.
Editor's note: The following analysis comes from a First Command Financial Behaviors Index release.
Active-duty service members are responding to the ongoing economic turmoil by shifting to a less risky approach to family finances.
The First Command Financial Behaviors Index reveals that 52 percent of middle-class military families (senior NCOs and commissioned officers in pay grades E-6 and above with household incomes of at least $50,000) are taking a more conservative attitude toward money as a result of the economy. Top fiscal strategies reported by middle-class military families include:
- Cutting back on everyday spending (58 percent).
- Increasing savings (28 percent).
- Decreasing the aggressiveness of investments (24 percent).
- Moving investments to cash (15 percent).
- Working with a financial planner (6 percent).
This more conservative approach to spending and investing comes at a time with many middle-class military families are reporting strong feelings of financial security month to month. The Index reveals that 52 percent of survey respondents do not feel financially stretched and 41 percent feel extremely or very secure financially.
“Amid continuing news reports of a global economic crisis and defense downsizing, military families are taking control of their own financial well being,” said Scott Spiker, CEO of First Command. “We are seeing a focus on the kinds of conservative spending, saving and investing behaviors that can help active-duty families lower their monetary risks. And as a result they are feeling better about their monthly finances.”