Defense Cutbacks Prompt Career Concerns In Military Families, First Command Reports
First Command Financial Behaviors Index® reveals that one third of servicemembers are worried about their future in the armed forces
FORT WORTH, Texas – Plans to cut billions in federal defense spending and a proposed overhaul of the military retirement system are fueling worries among active-duty servicemembers about the future of their careers in the armed forces.
Recent survey findings from the First Command Financial Behaviors Index® reveal that 37 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 concerned about their future in the military. Top worries cited by servicemembers or their families are:
- Effects of downsizing forces/personnel (29 percent)
- Effects of budget cutbacks on pay, benefits, etc. (21 percent)
- Changes to benefits after retirement (19 percent)
- Being prevented from serving in the military by being forced out or not permitted to enlist (12 percent)
- Job security (11 percent)
Many servicemembers are experiencing a crisis in career confidence. Given anticipated cuts to defense spending, one in four respondents say they are “not at all confident” or “not very confident” about their career in the military. When asked to consider the effect of proposed cuts to military retirement benefits, career confidence falls even lower. Roughly one third of respondents say they are not at all confident or not very confident about their military career. Roughly two out of five respondents say they expect to continue serving in the military for five years or less.
Survey respondents expect to be financially impacted by these changes. Almost one in five say they expect to be extremely or very affected by anticipated cuts in defense spending. And three out of ten say they expect to be extremely or very affected by proposed cuts to military retirement benefits.
“Military families recognize the changes that are coming their way, and they are justifiably worried,” said Scott Spiker, CEO of First Command Financial Services, Inc. “ It is worth noting that when asked about their future in the military, just 9 percent of respondents cited concerns about personal safety related to deployment. Certainly the risk of combat injury or death remains a real concern for our men and women in uniform, but it is now being overshadowed by vast financial and career uncertainties related to a shrinking defense budget. At a time when economic concerns continue to weigh heavily on many middle-class families, servicemembers and their families are facing the added worries of how their lives will be affected by a broad reshaping of the U.S. military.”
About the First Command Financial Behaviors Index®
Compiled by Sentient Decision Science, Inc., the First Command Financial Behaviors Index® assesses trends among the American public’s financial behaviors, attitudes and intentions through a monthly survey of approximately 530 U.S. consumers aged 25 to 70 with annual household incomes of at least $50,000. Results are reported quarterly. The margin of error is +/- 4.3 percent with a 95 percent level of confidence. www.firstcommand.com/research
About Sentient Decision Science, Inc.
Sentient Decision Science was commissioned by First Command to compile the Financial Behaviors Index®. SDS is a behavioral science and consumer psychology consulting firm with special vertical expertise within the financial services industry. SDS specializes in advanced research methods and statistical analysis of behavioral and attitudinal data.
About First Command
First Command Financial Services and its subsidiaries, including First Command Bank and First Command Financial Planning, assist American families in their efforts to build wealth, reduce debt and pursue their lifetime financial goals and dreams—focusing on consumer behavior as the first and most powerful determinant of results. Through knowledgeable advice and coaching of the financial behaviors conducive to success, First Command Financial Advisors have built trustworthy, lasting relationships with hundreds of thousands of client families since 1958.
First Command Financial Services, Inc., is the parent of First Command Financial Planning, Inc. (Member SIPC, FINRA), First Command Insurance Services, Inc. and First Command Bank. Financial planning services and investment products, including securities, are offered by First Command Financial Planning, Inc. Insurance products and services are offered by First Command Insurance Services, Inc. in all states except Montana, where as required by law, insurance products and services are offered by First Command Financial Services, Inc. (a separate Montana domestic corporation). Banking products and services are offered by First Command Bank. In certain states, as required by law, First Command Insurance Services, Inc. does business as a separate domestic corporation. Securities products are not FDIC insured, have no bank guarantee and may lose value. A financial plan, by itself, cannot assure that retirement or other financial goals will be met.
Posted: January 27, 2012