The changing terrain: Sequestration and shutdown
Exactly three-quarters of military families surveyed in the latest First Command Financial Behaviors Index® are anxious about cuts to defense spending. A slightly smaller amount (72 percent) anticipate being financially affected by cuts. These anxiety levels have remained unchanged throughout 2016, and even played a part in military families’ presidential election picks. Seventy-three percent said sequestration was an extremely or very important issue in making their presidential selection.
The area of primary concern when it comes to DoD budget cuts is a reduction in annual pay increases, expected by 40 percent of families surveyed, increased responsibility for healthcare costs at 31 percent and reduction in retirement benefits at 30 percent. These issues also affected presidential selections, with 79 percent saying defense spending and the cost of healthcare were extremely/very important in choosing a president, and 78 percent said changes to military retirement and other benefits were extremely/very important.
Military families are addressing their concerns through financial readiness, with 84 percent taking some type of action, including increasing savings, selected by 44 percent, and cutting back on everyday spending, selected by 31 percent. Nearly 60 percent are confident that Congress will void sequestration and the automatic budget cuts that would come with it in 2018. Forty-three percent feel that Congress should repeal the caps on military and domestic spending.
Finally, the threat of a government shutdown is still a concern, with less than half of families (41 percent) feeling extremely/very confident that Congress will avoid a shutdown before the end of the year. Twenty-eight percent are extremely/very anxious that there will be a shutdown.
Leave a Reply