FORT WORTH, Texas--(BUSINESS WIRE)--A budget-cutting proposal to close military commissaries threatens to further complicate the financial lives of active-duty servicemembers as they prepare for the impact of defense downsizing on their family finances.
“The threat of higher food costs complicates their ongoing efforts to spend less, save more and cut debt in preparation for the coming wave of military budget cuts.”
Recent results of the First Command Financial Behaviors Index® reveal that many military families are concerned that grocery bills will consume a larger portion of their monthly household budget should lawmakers enact a plan to shutter taxpayer-subsidized commissaries and instead give servicemembers a food allowance.
The Index reveals that 72 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) believe grocery prices are better in commissaries than off-installation stores. Roughly two out of five (39 percent) say that eliminating this lower-cost source of groceries would drive up their food costs, and 28 percent expect they would need to allocate a larger portion of their monthly budget to cover the added expense.
“Roughly four out of ten military families consider commissaries to be an important part of their current compensation as well as future retirement benefits,” said Scott Spiker, CEO of First Command Financial Services, Inc. “The threat of higher food costs complicates their ongoing efforts to spend less, save more and cut debt in preparation for the coming wave of military budget cuts.”
Despite these concerns, many servicemembers are taking an optimistic view of the cost-cutting proposal. Survey respondents say that replacing the taxpayer-supported stores with a monthly food allowance would give military families the added convenience of shopping anywhere and give the nation another way to cut government spending (44 percent and 43 percent, respectively). Eliminating commissaries would save the federal government about $1.3 billion a year, according to the nonpartisan Congressional Budget Office, which has long recommended this cost-saving move.
“As lawmakers look for ways to cut federal spending, our men and women in uniform are sizing up how those cuts might impact their near- and long-term finances,” Spiker said. “They are committed to pursuing frugal money behaviors, and they are focusing on the positive ways these changes may impact their families and the nation.”
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.