Advisors claim new ground with surprising demographic

Advisors claim new ground with surprising demographic

Advisors claim new ground with surprising demographic Money isn’t everything. Increasingly it’s all about client receptiveness, with a new report pointing to the growing demand among military families for financial planning help.
 
The most recent findings from the First Command Financial Behaviors Index (FCFBI) suggests advisors who are working with military families or are thinking of networking with this niche demographic have reason to be optimistic about their prospects of success. Here’s why.
 
“At a time of widespread uncertainty about sequestration and Defense downsizing, many military families are conscientiously tracking their finances,” said Scott Spiker, CEO of First Command Financial Service, Inc. “Seventy percent of career service members feel anxious about cuts to defense spending. That’s about twice the rate we see in the general population.”
 
While the study is U.S.-based, the uncertainties faced by military personnel in this country due to downsizing, etc., are analogous. The financial constraints facing military personnel in both countries is real.
 
First Command Financial Services commissioned Sentient Decision Science Inc. to compile the survey results from approximately 530 U.S. consumers between the ages of 25 and 70 and earning more than $50,000 annually. The survey assesses the financial behaviours, attitudes and intentions of both military and non-military families.
 
One of the most interesting pieces of information gleaned from the FCFBI is that 45 percent of military families are frequently meeting with a financial advisor compared to just 7 per cent of the general population.
 
“Our men and women in uniform are responding to this heightened anxiety through a variety of proactive financial behaviors. By diligently monitoring their finances, they are preparing themselves for an uncertain future,” Spiker commented. “The frequent reliance on financial advisors underscores the important role a professional can play in helping military families get their finances squared away.”
 
The Canadian experience is slightly different.
 
“The veteran group is much smaller here in Canada [than in the U.S],” said Edmund Chien, a Toronto advisor with Sun Life and who himself is a veteran. “When you have the career soldier who’ve retired, were talking about the officer ranks and not the enlisted, so the guys with 20 years full pensioned. A lot of them don’t really have all that much of a financial plan because they’ve got their full-pension out. So, it’s almost like managing money for a teacher. They don’t really need a lot of retirement planning.”
So, what are the needs of military personnel here in Canada?
 
The senior ranks, as he describes above, are more likely looking for life insurance as a way to leave a legacy for their children. The junior ranks, meanwhile, might be looking to invest an injury award, etc., to supplement a partial- or full-pension.