Wednesday, December 4, 2013

FINRA Foundation Releases Military Financial Capability Survey

By Tim Dulaney, PhD, FRM and Tim Husson, PhD

Yesterday, the Financial Industry Regulatory Authority (FINRA) Investor Education Foundation announced the release of their National Financial Capability Study's Military Survey.  The interactive results of the survey can be accessed here.  According to the foundation's president, the study finds that "most servicemembers are taking control of their finances. Three quarters have a retirement account, nearly 80 percent are living within their means, and many have participated in financial education offered by the military."  These results are relatively good news, as servicemembers are often considered uniquely vulnerable to financial fraud.

The study found that servicemembers on the whole typically have more solid finances than the general US population with a little medical debt and infrequent use of predatory non-bank borrowing (such as payday loans or auto title loans).  In addition, nearly half of those surveyed paid their credit cards in full each month.  At the same time, the survey points out that, while servicemembers may be able to appropriately budget, their financial literacy may need some improving.

The study surveyed 1,301 servicemembers between July and October 2012.  The results from this sample are then used to make general statements about the population of servicemembers using the Department of Defense's 2010 Demographics Report (PDF).

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