The latest findings from the First Command Financial Behaviors Index reveal that 62% of middle-class military families (commissioned officers and NCOs in pay grades E-5 and above with household incomes of at least $50,000) who work with a financial adviser report owning a retirement account.
As the report lays out, this figure is 16 points higher than those who do not use an adviser. Furthermore, the group of military members using a financial adviser is contributing far more to savings accounts on an ongoing basis. They report contributing $995 per month to savings accounts versus $410 for those without an adviser. And they are more likely to maintain long-term savings accounts (49% versus 28%) and contribute more dollars to those accounts ($544 per month versus $319).
Scott Spiker, chairman and CEO of First Command Financial Services, Inc., observes that saving for retirement is a particularly important issue this year as military families deal with uncertainties related to the new Blended Retirement System.
“Our survey findings continue to reveal that those who work with a financial adviser are more likely to save, and put away more dollars, than those who save and invest on their own,” Spiker says. “By coaching their clients to build strong money behaviors, financial advisers help families deal with the uncertainties of the new system and put money away for the future.”
According to First Command, two out of five survey respondents say they are increasing the amount they are saving and cutting back on everyday spending. And 14% say they have started to work with a financial adviser.
“One of the fundamental ways a trusted financial professional can help boost savings is by coaching their clients to set goals and make plans that are built on a pay-yourself-first strategy of automatic savings,” Spiker said. “At a time when so many military families feel anxiety about the future, it is worth noting that those who save more feel greater financial security and confidence.”
Seventy-eight percent of families who work with a financial adviser are extremely or very confident that their financial situation will improve in the next year. In contrast, just 38% of families without an advisor report the same feelings of confidence.