Twenty-seven percent of middle-class military families sought out the help of a financial adviser in July as a result of sequestration, up from 16% in June, according to the First Command Financial Behaviors Index. This is the highest level since First Command added the question to its monthly survey in January 2013.
Ninety percent of the military family members surveyed said they are taking action in their financial lives because of defense spending cuts. In addition to those who have started working with an adviser, 46% are saving more, 38% are cutting back on everyday spending, 24% are moving investments to cash, and 23% are decreasing the aggressiveness of their investments. Eleven percent say they are doing nothing as a result of sequestration, down from 19% in June and a record low.
“This growing interest in working with financial advisers is
a notable development, as it comes at a time of continued sequestration anxiety
in middle-class military families,” says Scott Spiker, CEO of First Command
Financial Services. “Concerns over cuts to defense spending and military pay
and benefits are motivating career service members to seek out professional help
in their efforts to make positive changes to their family finances.”
First Command’s report on the impact of sequestration comes on the heels of its second-quarter report that found two-thirds of military members who work with an adviser believe they will be able to retire comfortably.
Compiled by Sentient Decision Sciences, the First Command Financial Behaviors Index is based on a survey of 530 service members.