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Federal Employees Are Out-Saving Average Americans, Report Reveals

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December 1, 2009

Federal employees have pulled ahead of the general population in personal savings, bumping up their monthly contributions at a time when other middle-class Americans have stumbled, according to the First Command Financial Behaviors Index.

Results of the index's semi-annual federal employee survey indicate that these families dramatically improved their savings situation during the six-month period ending in September. Federal employees saw their average monthly contributions to short-term, long-term and retirement savings accounts rise 56 percent to $2,289. At the same time, other middle-class Americans saw their monthly total fall 11 percent to $1,923.

"Federal employees are setting the pace for positive savings behaviors," said Scott Spiker, CEO of First Command. "During a period when savings activity slowed among many middle-class consumers, the families of federal employees have significantly increased the dollars they are putting away for the future."

The most striking contrast between federal employees and average Americans can be seen in their retirement accounts. Average monthly contributions by federal employees surged 85 percent to $1,388. Average retirement savings for the general population plunged 25 percent to $765.

Federal employees also have increased the monthly dollars they put away for short- and long-term needs. Their average short-term savings totaled $705, up 11 percent from $633. The general population experienced a drop in short-term savings -- $860, down 3 percent from $885. Average long-term savings for families of federal employees totaled $196, up 145 percent from $80. The general population also experienced an increase in long-term savings, though considerably smaller in dollars and percentage change. Their average was $298, up 11 percent from $268.

This upward movement in savings behaviors by federal employees was mirrored in the military population, which also pulled ahead of the general population during the third quarter. Their average monthly contributions to short-term, long-term and retirement savings accounts rose 23 percent to $2,385.

"Federal employees and military professionals share many of the same attributes and qualities that we associate with diligent savings behaviors," Spiker said. "And both groups enjoy the positive feelings that come with these behaviors. They feel less stressed and better able to withstand the ups and downs of the economy than the rank and file of American consumers."

Federal employees with a financial plan developed by a financial advisor feel better about their savings than those without a plan. According to First Command's research, 19 percent of those with a financial plan feel extremely or very comfortable about their savings versus 9 percent of those without a plan.

More information about First Command and the First Command Financial Behaviors Index is at: First Command Financial Services and Research in Financial Planning and Behavior: First Command Financial Services

Posted with Permission from: MyFederalRetirement.com



Federal Employees Are Out-Saving Average Americans, Report Reveals
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