First Command News & Media
FOR IMMEDIATE RELEASE — Aug. 8, 2016
First Command Reports: Career military families cutting back on summer vacations
First Command Financial Behaviors Index® reveals top cost-cutting plans of men and women in uniform
FORT WORTH, Texas – America’s career military families are dialing back their vacation plans again this summer, continuing a long-term trend driven by persistent concerns about defense downsizing.
First Command’s annual survey on summer vacation spending reveals that 73 percent of middle-class military families (commissioned officers and senior NCOs in pay grades E-5 and above with household incomes of at least $50,000) say their summer vacation plans have changed as a result of the across-the-board cuts to defense and other federal spending called sequestration. This compares to just 40 percent of general population families, whose members are less likely to feel personally affected by military spending cuts.
“This 33-point gap reflects a long-term trend linked to heightened financial worries expressed by many career service member families,” said Scott Spiker, CEO of First Command Financial Services, Inc. “Our men and women in uniform feel anxious about sequestration and cuts to defense spending at a rate almost twice that seen in the general population. Recently-approved changes to the military retirement system, including a 20 percent cut to the traditional lifetime pension, are further intensifying anxiety levels and concerns in service member families. Frugal spending strategies represent a practical approach to exerting some level of control over these largely uncontrollable issues.”
Service member households have identified a variety of techniques for spending less this year on summer vacations, and they are more likely to say they will pursue these techniques than their civilian counterparts. Popular cost-cutting approaches related to defense cuts include:
- Taking shorter vacations (28 percent of military families versus 10 percent of civilian families)
- Cooking rather than eating out (21 percent versus 9 percent)
- Staying closer to home (19 percent versus 10 percent)
- Taking “staycations” (18 percent versus 7 percent)
- Visiting family (18 percent versus 8 percent)
- Driving rather than flying (17 percent versus 10 percent)
Similar savings strategies were reported by military and civilian respondents who are cutting back due to economic concerns. As with sequestration, military households are more likely to respond to economic worries by implementing cost-cutting measures than their general population counterparts.
“Career military families have made spending less and saving more a permanent part of their financial behaviors,” Spiker said. “Cutting back on vacation spending is a reasonable and frugal response to an uncertain financial future.”
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. http://www.firstcommand.com/fbi/
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.