Publication year
2014
Citation Title
The impact of financial resources on Soldiers’ well-being.
Journal Name
Journal of Financial Counseling and Planning
Journal Volume
25
Issue Number
1
Page Numbers
41-52
DOI
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2466556
Summary
Service members experience unique financial stressors and buffers. The study examined the effect of financial resources on Soldiers' well-being by having 715 Soldiers self-report their subjective well-being, financial asset, perceived financial knowledge, and constrains on resources. Results indicated negative associations between Soldiers' financial stress and subjective well-being.
Key Findings
Higher credit card debt and lower perceived net worth were associated with lower well-being of Soldiers.
Financial knowledge and the amount of emergency savings were positively associated with Soldiers' well-being.
Soldiers with higher amounts of credit card debt ($2,500 or more) and automobile debt ($10,001-$20,000) were more likely to experience low subjective well-being than Soldiers with a lower debt level.
Age and military rank were unrelated to Soldiers' financial behaviors and subjective well-being.
Implications for Program Leaders
Develop financial education classes and workshops for Service members and their spouses to increase their financial knowledge
Provide financial education through a variety of delivery methods (e.g., in person, phone-based, online, group, hybrid)
Offer financial counseling services for Service members who have a high amount of credit or automobile debt
Implications for Policy Makers
Continue to support the development of financial education programs for Service members
Encourage training for professionals who work with military families on methods to teach Service members financial management skills
Support research and programs that promote financial well-being in military families
Methods
The method of participant recruitment was not indicated; of over 1,000 Soldiers surveyed, 715 finished the study.
Measures included Soldiers' subjective well-being (e.g., levels of anxiety), financial assets (e.g., self-assessed net worth), perceived financial knowledge (e.g., interest rates), and constraints on resources (e.g., credit card debt).
Data were analyzed to examine the relationship between financial resources and Soldiers' well-being.
Participants
Participants included 715 Soldiers at a Midwestern Army installation; over half (65%) of participants held the rank of E1-E4, 27% of participants held the rank of E5-E6, and only 8% of participants held the rank of E7 and up.
The average age of participants was 26.14 years (SD = 5.74, age range = 19-46 years) and the majority (97%) of participants were male.
The race/ethnicity of participants was not reported.
Limitations
The sample was exclusively Soldiers; therefore, the results of the study may not apply to Service members of other military branches.
Only self-report data were collected in the study; therefore, the data may not fully reflect participants' true financial status.
Hundreds of surveyed Soldiers chose not to complete the survey or provided information that was invalid, so the sample was subject to self-selection bias (i.e., individuals select themselves into a study, causing nonprobability sampling).
Avenues for Future Research
Replicate the study design with other military service branches to get a comprehensive view of all Service members' financial status and well-being
Examine whether the association between financial resources and Soldiers' well-being is influenced by Soldiers' race/ethnicity background
Investigate the potential effect of marriage status on Soldiers' financial well-being
Focus
Army
Target Population
Population Focus
Military Branch
Military Component
Abstract
The present study examined the impact of financial resources on soldiers’ well-being. Using primary data gathered from a large Army installation in the Midwest, results suggested that soldiers with higher credit card debts and lower perceived net worth had lower levels of subjective well-being. Soldiers with greater perceived financial knowledge and larger emergency savings accounts had higher levels of subjective well-being. Results also indicated that automobile loan debt may play a small role in the subjective well-being of soldiers. Personal financial managers, financial planners, counselors, and other military service providers can use this knowledge to identify those whose subjective well-being might be or might become impaired by personal financial distress.
Abstract Document
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