NORFOLK, Va. — Being a military spouse is tough, especially when you consider all the moves from one duty station to the another during a service member's career.
The Department of Defense's 2019 Active Duty Spouses Survey showed that even before the COVID-19 pandemic, the military spouse unemployment rate stood at a staggering 22%.
"We're ignoring the military spouses in all this," said Mark Steffe, President and CEO of First Command. Financial Planning, Inc. "And, as you well know, they play a critical role in military families."
And, that's just one of many challenges.
Career military families are trailing their civilian counterparts in basic money knowledge, underscoring long-term financial readiness issues that service members and their spouses face.
Commissioned officers and senior NCOs in pay grades E-5 and above with household incomes of at least $50,000, are less knowledgeable about managing household budgets and savings, according to a new survey from First Command.
Results of the company's 10th annual financial readiness test and survey revealed that middle-class military families earned an average grade of 57. That’s down from 71 last year and the lowest in the history of the test.
In contrast, people with similar household incomes who are in the general population earned an average grade of 69, which is unchanged from 2020.
Sixteen percent of military test takers correctly answered seven or more questions in the nine-question quiz, which is designed to measure basic money knowledge associated with financial readiness. That compares to 44% of civilian respondents. Perfect scores were earned by less than 1% of military respondents and 8% of the general population.
The military-general population gap is particularly noteworthy as military test takers are significantly more likely than their civilian counterparts to say they’ve completed a financial literacy or education program (56% versus 31%). Notably, the benefits of these programs are not fully reflected in test scores. Among those who completed a financial education program, perfect scores were earned by less than 1% of the military compared to 23% of the general population.
"Military members are scoring lower and the trend is down," said Steffe."And that, for us, was probably the most concerning thing."
Steffe said military families need greater access to financial education and face-to-face coaching.
"I do believe COVID has a hand in this," he said. "I think there are a lot of distractions, but I think a lot of training we're doing, when you look at these statistics, I just don't think it's hitting the mark. I think the training needs to be more robust. I think there's needs to be more competency-based training, and I think, like a lot training we go through in our careers, I think there needs to be follow-up training to make that training take rot and really help people develop sound financial behaviors."
Earlier this week, First Lady Dr. Jill Biden talked about the issue of assisting military families with financial challenges.
She discussed White House plans to work with employers to create more flexible, transferable, and remote job opportunities for military spouses.