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29 Aug, 2015

Costs Forcing U.S. Military Families To Scale Back Summer Vacations

FORT WORTH, Texas–(BUSINESS WIRE)–August 06, 2015 — Sequestration and economic worries are prodding America’s career military families to scale back their rest and relaxation plans again this summer.

The First Command Financial Behaviors Index® reveals that 47 percent of middle-class military families (commissioned officers and senior NCOs in pay grades E-6 and above with household incomes of at least $50,000) expect to spend less money this year on summer vacations, continuing a frugal trend that emerged during the economic downturn and has continued with widespread concerns over defense downsizing. Just 22 percent say they will spend more money this year.

The Index reveals that sequestration and economic concerns are affecting the summer vacation plans of military families at a significantly greater rate than in the general population. Popular cost-cutting approaches related to sequestration include:

  • Taking shorter vacations (29 percent of military families versus 12 percent of civilian families)
  • Staying closer to home (21 percent versus 12 percent)
  • Taking “staycations” (21 percent versus 8 percent)
  • Cooking rather than eating out (21 percent versus 6 percent)
  • Driving rather than flying (20 percent versus 11 percent)
  • Visiting family (20 percent versus 7 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.

These frugal plans come at a time when many servicemembers are worried about their family finances. The Index reveals that 70 percent of military respondents feel anxious about cuts to defense spending and more than half are concerned about their job security in the coming months.

“Persistent financial worries are causing some military families to lose confidence in their near-term finances,” said Scott Spiker, CEO of First Command Financial Services, Inc. “Frugality represents a way that these families can take some level of control over these largely uncontrollable issues. Cutting back on vacation spending is a reasonable 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. www.firstcommand.com/research