First Command Reports: Military Spouses Feel Ill-Equipped for BRS Decision

Military wives and husbands expect to share in key decisions this year under the new Blended Retirement System, but they report feeling less prepared to make those choices than service members.

The First Command Financial Behaviors Index reveals that 84 percent of spouses in career military families (commissioned officers and NCOs in pay grades E-5 and above with household incomes of at least $50,000) expect to be extremely or very involved in the process of deciding between opting into the Blended Retirement System (BRS) and sticking with their traditional guaranteed pension. But only 25 percent say they feel extremely or very prepared to participate effectively in that decision.

Most military spouses are confident and secure in handling their family finances, but their confidence fades in the face of the BRS, said Scott Spiker, chairman/CEO of First Command Financial Services, Inc. Wives and husbands receive limited access to the BRS education and training that is required for eligible service members. That may be the primary reason that service members are considerably more likely to feel ready for the BRS-opt-in decision.

The Index reveals that 50 percent of career service members say they feel extremely or very prepared to participate effectively in the opt-in decision. Thats 25 points higher than reported by spouses.

The BRS represents a major shift in military retirement planning, one that features a 20 percent cut in the traditional guaranteed pension. That cut pays for a new defined contribution program that includes automatic and matching Thrift Savings Plan contributions, mid-career continuation pay and a lump sum buyout option. The program applies to all new service members who started since Jan. 1, 2018, but military members with 12 years or less of service on Dec. 31, 2017, are eligible to opt in to the new program during 2018. The deadline is Dec. 31.


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As of November, 39 percent of eligible career military families said they have chosen to opt into the BRS.

While the new benefits may appear appealing at first glance, a 20 percent reduction in guaranteed lifetime income is a matter of serious concern. For that reason BRS regulations include mandatory education for service members in advance of the decision to opt into the new system or stick with the guaranteed income from the legacy pension.

Ninety-two percent of service members said they found the opt-in training course to be extremely or very useful. Almost all of the spouses in the survey said they also would find education and training to be a valuable tool in helping them understand the BRS opt-in decision.

Leaving wives and husbands out of the BRS opt-in training is a troubling oversight, Spiker said. Military spouses want to be part of the decision making. They understand that retirement decisions can significantly affect the long-term financial security of their families. Our survey results reveal that one in three spouses think they should have an equal voice in the opt-in decision.

Financial coaching can play a key role in helping service members and spouses work together to successfully navigate the BRS and prepare for their financial future. The Index consistently reveals that career military families who work with a financial advisor are more likely to save more and feel more confident about their finances than their colleagues who do not work with an advisor.

Coaching helps service members and their spouses make the most of their government pay and benefits, Spiker said. Working with a financial coach gives military spouses an equal voice in retirement and other financial decisions and supports military families in their continuing pursuit of long-term financial security.

About the First Command Financial Behaviors Index

Compiled by Sentient Decision Science, Inc., the First Command Financial Behaviors Index assesses trends among the American publics 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.

About Sentient Decision Science, Inc.

Sentient Decision Science was commissioned by First Command to compile the Financial Behaviors Index. SDS is a behavioral science and consumer psychology consulting firm with special vertical expertise within the financial services industry. SDS specializes in advanced research methods and statistical analysis of behavioral and attitudinal data.

About First Command

First Command Financial Services and its subsidiaries, including First Command Financial Planning and First Command Bank, coach our Nations military families in their pursuit of financial security. Since 1958, First Command Financial Advisors have been shaping positive financial behaviors through face-to-face coaching with hundreds of thousands of client families.

First Command Financial Services, Inc., is the parent of First Command Financial Planning, Inc. (Member SIPC, FINRA), First Command Advisory Services, Inc., First Command Insurance Services, Inc. and First Command Bank. Financial planning services and investment products, including securities, are offered by First Command Financial Planning, Inc., a broker-dealer. Financial planning and investment advisory services are offered by First Command Advisory Services, Inc., an investment adviser. Insurance products and services are offered by First Command Insurance Services, Inc., in all states except Montana, where as required by law, insurance products and services are offered by First Command Financial Services, Inc. (a separate Montana domestic corporation). Banking products and services are offered by First Command Bank. In certain states, as required by law, First Command Insurance Services, Inc. does business as a separate domestic corporation. Securities products are not FDIC insured, have no bank guarantee and may lose value. A financial plan, by itself, cannot assure that retirement or other financial goals will be met. First Command Financial Services, Inc. and its related entities are not affiliated with, authorized to sell or represent on behalf of or otherwise endorsed by any federal employee benefits programs referenced, by the U.S. government, or the U.S. armed forces.

Mark Leach
Media Relations
[email protected]