“Federal employees are clearly focusing on improving their long-term finances,” said Scott Spiker, CEO of First Command Financial Services, Inc. “We saw this trend emerging in the fall, when federal employees dramatically increased their retirement savings at a time when the general population was pulling back. These families are responding to the recent economic turmoil by taking control of their personal finances and committing to a more financially responsible lifestyle.”
The substantial dollars allocated to long-term debt in the first quarter also helped federal employees outpace the general population in overall debt payments ($2,132 versus $2,033). However, federal employees trailed average Americans in overall savings activity. Average monthly payments for short-term and long-term savings and retirement accounts totaled $2,006 for federal employees compared to $2,292 for the general population.
Interestingly, federal employees with a financial plan put a higher amount, on average, into savings and investment accounts than those without a plan. During the first quarter, overall savings for those with a financial plan totaled $2,542 compared to $1,781 for those without. Federal employees with a financial plan have greater feelings of comfort with savings than those without a plan. In the first quarter, 20 percent of federal employees with a financial plan felt extremely or very comfortable with their current savings compared to only 11 percent of federal employees without a plan – a nine-point gap. A similar disparity of 11 points exists with respect to comfort with current debt levels—37 percent versus 26 percent.
“Federal employees with a financial plan also feel less financially stretched than those without a plan,” Spiker said. “Our research and half century of experience working with middle-class consumers continues to show that people who save more and cut debt feel less stressed and more optimistic about their personal finances.”
