Advisors: The Military Wants You



Serving in the military has rewards beyond financial recompense: the emotional reward of serving one’s country, the camaraderie that one feels when serving with others, and the many opportunities to make the lives of other people better through social or protective services.

But the financial rewards are also extensive, and include a good salary, tax-free income and investment opportunities, college tuition benefits, and a well-managed retirement program called Thrift Savings Program, which is equivalent to an employee-sponsored 401(k) program.

With all of the rewards and benefits which come from military service, many service personnel and their family members become financially stable as a result. And, according to Spectrem research, military personnel and their families welcome the opportunity to work with financial advisors and providers.

Spectrem’s study How Involvement in the Military Impacts Financial Lives shows how investors who have either served in the military or have family members who have served in the military approach financial matters differently than investors with no military service in their background or family relations.

For advisors and providers, one of the most significant takeaways from the study is that investors with a military presence in their family are much more likely than those without to use a professional advisor.

Based on a survey of investors with a net worth between $100,000 and $25 million, not including the value of their primary residence, almost 60 percent of investors with military service in their family use a financial advisor. That percentage climbs to 63 percent of investors who have a child in the military.

The reasons military personnel and their families might be more likely to use a financial advisor come from the situation they find themselves when the military service is completed. While many veterans suffer from a lack of direction upon leaving the service, with no employment history behind them other than their time in the military, those who have assets to invest want to protect them in case of future employment or health issues, and using a financial advisor is the best way to create those protections.

Asked to list their primary financial provider, 15.9 percent of those with a child in the military use Fidelity, and 6.7 percent use Vanguard or Merrill Lynch. More than 5 percent of investors with children in the military use Charles Schwab and Wells Fargo.

Investors who themselves have served or currently serve in the military lean even more toward Fidelity (16.9 percent), and Vanguard (9.0).

There is also a lean among investors with a military background toward advisor dependency. More than 20 percent of investors with a child in the military self-describe as completely advisor-dependent, notably above the 17 percent among those with no family member in military service.

Finding potential clients with military backgrounds should not be difficult. There are dozens of organizations aligned with veterans, and many of them have offices near Veteran’s Administration buildings or hospitals. Marketing your services through those types of organizations could be beneficial.   



©2020 Spectrem Group



Keywords: military, advisors, investor, Spectrem, benefits, army, navy, air force