Military Families Financially Better Off Than Civilians
There is no question that many Americans feel the effects of the recession in their everyday lives. But new research shows that military families are uniquely poised to weather the current downturn.
The latest findings of the First Command Financial Behaviors Index reveal military families with household incomes of at least $50,000 display specific behaviors that are associated with financial hope and optimism. First quarter survey results indicate that military families are half as likely to feel financially stretched than average Americans, and they are also less likely to feel stressed about the current economic situation.
The Index reveals striking differences in military families with a financial plan versus those without a plan. Over half of respondents with a plan feel confident about their ability to retire comfortably. Conversely, only 33 percent of those without a plan are confident. What's more, families who have a financial strategy are more likely to be comfortable with their current level of debt than those without a plan.Families who use a financial advisor are less worried about retirement and debt because they're not in it alone. Having a coach through the process provides a valuable outside perspective and may help families avoid knee-jerk financial decisions.
Having a financial plan also appears to have a positive effect on savings behaviors for military families. Financially savvy military families report an increase in short-term savings in March of $1,183 -- up 38 percent from the Index's previous military family survey in September 2008. Additionally, they contribute 71 percent more towards long-term savings. Families without a plan actually decreased short-term savings by 6 percent to $707, and barely contributed any funds to long-term savings.
More families are focusing on retirement. Families with a financial plan contribute $988 in retirement savings monthly, about 40 percent more than those without a plan.
These proactive savings and debt-reduction behaviors are great news. During good times and bad, those families that continue to boost savings and reduce debt are less likely to feel stressed and better able to withstand the ups and downs of the economy.
For more tips or articles about surving the economic downturn, visit Military.com's Finance Channel.