New Research: Financial Well-Being of U.S. Military Veterans Improving, Surpassing Non-Veterans

Veterans who are female, younger, married, divorced or separated, or who have children are faring worse than their veteran peers

WASHINGTON — The financial well-being of U.S. military veterans has improved in recent years, outpacing the gains of non-veterans, according to new research by the FINRA Investor Education Foundation. Veterans, overall, reported having less difficulty covering their expenses and bills, had a lower likelihood of experiencing an income drop and were more likely to have an emergency fund, according to the survey of more than 3,000 veterans and more than 20,000 non-veterans.

Even as FINRA Foundation research shows that many Americans struggle to make ends meet, veterans are expressing higher financial well-being, lower levels of financial anxiety and a higher likelihood of having a will, the new survey shows. Veterans were also 33 percent more likely to participate in the gig economy and were 12 percent more likely to use financial technology for planning. Further, veterans were more likely to have a retirement plan, in addition to an employer plan.

The study examined the financial capability of veterans over time and compared these gains relative to civilians in 2018. Researchers also analyzed differences among demographic subgroups of veterans.

“The financial well-being of U.S. military veterans is a critical issue that has been largely understudied,” said FINRA Foundation President Gerri Walsh. “These research findings provide new insights to inform additional research and policy development to help service providers, advocates, policymakers and others develop better resources, tools and information to improve the financial and health outcomes of veterans.”

As researchers benchmarked key measures of financial capability from 2015 to 2018, veterans demonstrated that over time, they were:

• 23 percent less likely to be underwater on their home (among those who owned a home);
• 15 percent less likely to have difficulty covering bills and expenses;
• 15 percent less likely to have experienced a drop in income in the past 12 months;
• 5 percent more likely to have an emergency fund;
• 7 percent more likely to have retirement savings outside an employer plan; and
• 5 percent more likely to have savings in non-retirement accounts.

However, in spite of veterans’ apparent gains over a three-year period, survey findings also showed that veterans in 2018 were:

• 28 percent less likely to be attending a four-year college or university (among those attending schools);
• 11 percent more likely to report having foregone medical treatment; and
• 11 percent more likely to report high-cost credit card behaviors such as late fees.

Researchers also found that relative to male veterans, female veterans in 2018 had:

• 4 percent lower financial self-efficacy;
• 16 percent higher financial anxiety; and
• 25 percent higher financial stress.

“We’re fortunate in that our study relies on the most comprehensive collection of data chronicling veterans’ financial well-being over time, comparative data with civilians and detailed evidence on key differences within important veteran subgroups,” said Dr. William Skimmyhorn, one of the study’s authors and an Assistant Professor of Economics and Finance at William & Mary. “While our findings do not enable causal conclusions, they document how our military veterans are doing financially in several important areas.

“We hope our research will draw and maintain public attention to the financial well-being of our nation’s veterans, so that we might serve them as they have so ably served us,” added Dr. Skimmyhorn, a retired Lieutenant Colonel in the U.S. Army.

To access the full report, data sets, survey instrument and methodology, visit USFinancialCapability.org. Test how you fare on the Financial Literacy Quiz.

About the FINRA Investor Education Foundation

The FINRA Foundation supports innovative research and educational projects that empower underserved Americans with the knowledge, skills and tools to make sound financial decisions throughout life. For more information about FINRA Foundation initiatives, visit www.finrafoundation.org.