VIENNA, Va.--(BUSINESS WIRE)--Navy Federal Credit Union today released a new report on the financial impact of the COVID-19 pandemic on military families. The survey of more than 1,100 active duty servicemembers, veterans and military spouses illustrates the new financial habits military families picked up, their financial plans for the coming months, differences in saving and spending across generations, and the disparate impact of the pandemic on military spouses.
Household Expenses and New Financial Habits
As a result of the pandemic, Navy Federal found that the majority of military households cut expenses and adopted new financial habits in 2020, with 89 percent of respondents indicating that they spent less on an expense in 2020. The most common expenses cut include:
- Vacation travel (63 percent)
- Eating out (58 percent)
- Entertainment (57 percent)
- Self-care (41 percent)
- Clothing (40 percent)
Military families did more than just cut back on their spending though, with 77 percent indicating that the upheaval of 2020 caused them to embrace at least one new financial habit. The most common new financial habits reported were:
- 43 percent cut back on daily spending
- 36 percent kept track of finances more closely
- 27 percent established or added to an emergency savings fund
- 26 percent paid off credit card bill monthly
- 25 percent used digital/contactless payment
- 23 percent maintained a monthly budget
- 20 percent set up autopay for bills or recurring payments
“The COVID-19 pandemic disrupted every facet of our lives, and our members have taken this turmoil in stride and adapted their financial habits to face this new challenge,” said Clay Stackhouse, a retired Marine Corps colonel and regional outreach manager at Navy Federal. “At Navy Federal, we’re passionate about supporting military communities and dedicating resources to ensure they have financial tools and knowledge needed to meet their financial goals. Our proactive approach and ongoing dedication to our members allowed us to support military families during this challenging time.”
Military Families Re-emerge: Summer Spending and Travel
As more Americans are vaccinated and it becomes safe to travel; dine out at restaurants, shop or visit entertainment venues; and see family and friends, most military families plan to re-emerge this summer and start spending again. Overall, 69 percent of military families report they plan to do more or just as much in summer 2021 as they did in past summers. Similarly, 64 percent report they will spend either more money or just as much money as usual this summer. Still, a significant portion of military households plan to maintain their pandemic spending habits, with 35 percent indicating they will spend less than in past summers. Other key findings regarding summer include:
- Military families report they plan to travel more frequently (43 percent), go out to restaurants and bars (31 percent) and shop in-person at stores (25 percent).
- More active duty servicemembers (34 percent) plan to go out and do more things this summer than in the past than veterans (21 percent) and military spouses (23 percent).
- Most military families plan to bring back vacation travel (60 percent).
Differences Across Generations and the Impact on Spouses
When looking at different age groups of servicemembers, veterans and spouses, differences begin to emerge across generations when it comes to pandemic spending, new financial habits and post-pandemic outlook. Navy Federal found that:
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The younger you are, the more likely you were to pick up a new financial habit
- 18-34 (86 percent)
- 35-54 (76 percent)
- 55+ (66 percent)
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Younger people in the military community are more likely to have increased the amount of food they have ordered for delivery or pickup
- 18-34 (46 percent)
- 35-54 (33 percent)
- 55+ (36 percent)
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Younger people report feeling high levels of uncertainty or feeling stuck more so than older generations
- 18-34 (26 percent)
- 35-54 (21 percent)
- 55+ (12 percent)
Additionally, the research study showed that military spouses experienced a greater impact from the pandemic, and its effects will likely last, even as the pandemic wanes:
- Of households who reported they cut childcare expenses in 2020, 55 percent indicate they plan on delaying or not bringing back this expense.
- 46 percent of active duty spouses report cutting back on self-care during COVID compared to just 31 percent of servicemembers.
- 81 percent of active duty spouses reported a higher level of uncertainty about post-pandemic life.
Navy Federal uses the data and insights it gleans from this research to provide timely and relevant financial tools in support of its members’ financial journeys. Navy Federal has been continually recognized for its dedication in delivering exceptional service for its members, ensuring members are educated and can achieve their financial goals though all life stages.
About Navy Federal Credit Union: Established in 1933 with only seven members, Navy Federal now has the distinct honor of serving over 10.5 million members globally and is the world’s largest credit union. As a member-owned and not-for-profit organization, Navy Federal always puts the financial needs of its members first. Membership is open to all branches of the armed forces and their families. Dedicated to its mission of service, Navy Federal employs a workforce of over 23,000 and has a global network of 345 branches. For more information about Navy Federal Credit Union, visit navyfederal.org.
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Methodology: These are the results of a survey of more than 1,100 active duty servicemembers (n=255), veterans (n=543) and military spouses (n=334). Current and former military household interviews were conducted online among Navy Federal Members as well as a general population component through Maru/Blue. Data were aggregated and weighted on age and military affiliation status. The survey was fielded March 24 – April 6, 2021.