U.S. Military Households More Likely in Better Financial Situation Than Non-Military Households

Military households are more likely to have higher assets and less likely to consider debt a problem compared with non-military households. That’s according to new research from the Employee Benefit Research Institute (EBRI) and Greenwald Research.

Also, military households with higher incomes are more likely to be confident about retirement prospects than non-military households.

The report, “Military Households and Retirement: Findings From the 2024 Retirement Confidence Survey,” examines the retirement prospects, knowledge, preparations and experiences in retirement for those who are from a military household compared with a non-military household. (Military households are defined as those individuals who have served in the U.S. armed forces or are currently active in the National Guard or Reserve, as well as those who are married or partnered to or widowed by such individuals. The vast majority of the military households have respondents who are veterans or have a spouse who is a veteran).

Key findings in the report include:

• Military households are more likely to have the highest levels of financial assets and less likely to consider debt to be a problem than non-military households. Forty-nine percent of military households report having $250,000 or more in financial assets compared with 40% of the non-military households having this amount. Fifty-five percent of military households consider debt to not be a problem, while 46% of non-military households consider debt to not be a problem.

• Military households are more likely to have done various tasks in preparing for retirement than non-military households. In particular, military households are more likely to have thought about how much money to withdraw from their retirement savings and investments in retirement (52% vs. 42%), thought about how they will occupy their time in retirement (68% vs. 58%), calculated how much money they would likely need to cover health expenses in retirement (50% vs. 41%), estimated how much income they would need each month in retirement (63% vs. 54%), and planned for how they would cover an emergency or big expense in retirement (56% vs. 47%) than non-military households.

• Military households in the higher two income groups ($35,000-$74,999 and $75,000 or more) are more likely to be confident in their retirement prospects than non-military households, but no difference in this confidence is observed among those in the lowest-income group (less than $35,000). Specifically, 89% of military households with incomes of $75,000 or more are confident that they will have enough money to live comfortably throughout their retirement compared with 81% of their non-military counterparts. For the middle-income group, 72% of military households vs. 61% of non-military households are confident in their retirement prospects.

• Approximately 9 in 10 respondents in military households disagree with the statement that their military service has prevented them from saving for retirement. Furthermore, 71% of respondents from veteran households said they separated from service before military retirement, while 24% retired from the military and 6% medically retired.

• Military-household respondents are less likely to express concern over various scenarios that could impact Americans’ retirement finances or retirement in general than are non-military households. The scenarios less likely to be of concern to military households include the potentials for rising housing costs, increasing cost of living making it harder for them to save as much money, or having to make substantial cuts to their spending because of inflation.

• The top four sources of information are consistent across military and non-military households: family and friends; a personal, professional financial advisor; online resources and research conducted on their own; and employer or information received at work. However, military households are significantly more likely than non-military households to say they use non-profit organizations that focus on serving a specific group or community as a source of information, while non-military households are more likely to say that family and friends are a source of information.

• Military-household retiree respondents are more likely to say that they retired when they planned than non-military household retiree respondents. Among those who retired earlier than planned, the top three reasons cited by both military and non-military household respondents are that they could afford to retire, had a health problem or disability, or there were changes at their company, such as downsizing, closure or reorganization.

• Military-household retirees are in general positive about their lifestyle. Specifically, 80% of military retirees say their lifestyle is what they expected or better before they retired and 71% say they are having the lifestyle they had envisioned. Non-military retirees have similar feelings about their lifestyle in retirement.

“Military households seem to be in better financial shape and are more likely to be confident in having enough money to last throughout retirement as well as various other aspects about retirement than non-military households. These households are more likely to have saved for retirement, to have done various other tasks to prepare for retirement and to be currently collaborating with a financial advisor. Finally, an overwhelming share of individuals agree that their military service did not prevent them from saving for retirement,” explained Craig Copeland, director, Wealth Benefits Research, EBRI.

The Retirement Confidence Survey is conducted annually by EBRI and Greenwald Research. The 2024 survey of 2,521 Americans was collected online from Jan. 2-31, 2024. All respondents were ages 25 or older. The survey included 1,255 workers, 1,266 retirees and an oversample of 829 respondents from military households (330 workers and 499 retirees). To view a 2024 RCS military households summary report, visit www.ebri.org/retirement/retirement-confidence-survey.

“While individuals in military households appear to be better prepared and more confident in their retirement prospects, many seem to navigate at least one significant change in their careers, as a very high share separate from service before military retirement. The transition requires knowing what to do with their retirement savings, past and future, as they switch careers. While career changes happen to many Americans, it’s certainly imaginable the change for military personnel is more complex and may include learning about a whole new set of retirement and financial wellbeing benefits. While military service can put individuals on a better track, they still face many of the same issues as those who have not served, such as determining when to retire, accumulating and preserving assets, and managing income sources for retirement,” said Lisa Greenwald, CEO, Greenwald Research.

The 2024 survey was made possible with support from American Funds / Capital Group, Ameriprise Financial (Columbia Threadneedle), Bank of America, Empower, Fidelity Investments, FINRA, Jackson National, JPMorgan Chase, Mercer, Mutual of America, Nationwide, National Endowment for Financial Education, PGIM, Principal Financial Group, T. Rowe Price, USAA and Voya Financial.

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