First Command Financial Services released new results from its quarterly Financial Behaviors Index that shows 71% of middle-class military families have suffered some kind of health issue in the last year commonly related to financial anxiety.
However, the firm announced in June that financial confidence among military members was at a record high. According to the quarterly index, 72% of respondents believe their financial situation will improve in the next year, and 69% are more confident about their ability to retire, a 23 percentage point improvement over January.
Short-term confidence was up as well, with 53% of respondents saying they feel more financially comfortable month to month.
The newest release shows that 87% of respondents who reported high levels of anxiety also reported having some kind of health problem associated with that: 43% said they had difficulty sleeping, 27% said they had more frequent headaches, including migraines; and 19% said they were more irritable or that there was a strain in their relationships.
According to First Command, that doesn’t represent a disconnect between financial confidence and finance-related health problems, but are two parts of a “multifaceted story.”
“The uncertainties of sequestration and anticipated cuts to defense spending create anxiety. We see that anxiety reflected in some mental and physical health issues. We also see that many servicemembers respond to their feelings of anxiety through proactive consumer behaviors (such as saving more and spending less). Those behaviors tend to drive feelings of confidence,” according to the firm.
In an email to ThinkAdvisor, First Command illustrated it like this: “I am a career servicemember who feels anxious and worried about my family finances due to uncertainties about sequestration and defense spending. These feelings of anxiety and worry are showing up in some finance-related health issues, such as difficulty falling asleep. I do not have the ability to stop sequestration, but I can respond to it by taking positive actions, such as saving more and spending less. As I take these actions, I can see in my savings account balance and household budget numbers that I am becoming more prepared for the future, which makes me feel more confident about my own financial future.”
The First Command Financial Behaviors Index surveys approximately 530 American consumers every month and reports the results quarterly. Military respondents are senior NCOs and commissioned officers with household incomes of at least $50,000.
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