A new analysis of more than 900,000 service members’ checking, savings and credit card accounts found troops’ accounts were more financially resilient in 2023 compared to pre-COVID-19 pandemic levels, but the findings also show signs of the effects of inflation.
The survey, conducted by USAA, analyzed the data of more than 900,000 currently serving members who had one or more USAA bank products — checking, savings or credit card accounts — at any point in time between 2019 and 2023, including active duty, Guard and Reserve members. USAA membership is open to all branches of service. Account owners were anonymous in the analysis of the aggregate data.
Overall, service members grew their savings account balances by an average of 19% in 2023 compared to 2019 and maintained an average of 23% more in checking accounts.
The average daily credit card balance for service members was 23% lower at the end of 2023 than in 2019. That’s in contrast to mounting credit card debt nationally for the average consumer since before the pandemic, according to data from the Federal Reserve Bank of New York.
However, in a sign of the potential effects of inflation, surveyed troops’ average checking and savings balances declined year over year between 2022 and 2023, with checking balances declining by about 12% and savings declining by about 10%. Further, service members were using their credit cards more for essentials such as food, pharmacy, fuel and utilities.
Though various groups have conducted surveys about troops’ finances over the years, USAA’s work is believed to be the first large-scale analysis of actual checking, savings and credit card data of currently serving troops.
The analysis “points to a military population that has taken meaningful steps to improve their financial health, even amid some tough economic circumstances,” said Michael Moran, interim president of USAA Federal Savings Bank, in an announcement of the findings. The study “goes beyond sentiment to put a real number behind the optimism and the challenges that our military members share with us on a daily basis.
“While it’s great to see service members in a better place than they were pre-pandemic, we can’t ignore the reversal in trends. With inflation continuing to pressure military households, we encourage service members to be vigilant with their personal finances and preserve some of these hard-earned gains.”
JJ Montanaro, a certified financial planner with USAA’s military advocacy group, said based on what he’s heard from his interactions with USAA members in 2024, “My guess is that if we do [the analysis] again at the end of this year, we’ll see further deterioration” in some of these financial aspects within the currently serving military.
USAA aims to conduct this analysis every year, according to USAA spokesman Daniel Diaz.
Diaz noted that employment for service members was relatively stable during the pandemic and service members also received federal COVID-19 stimulus checks while employed. There has also been a strong emphasis on financial readiness in the military over the last few years, he noted.
The 900,000 service members in the analysis had one or more USAA accounts during the five-year period. The population, like the overall military, is fluid, with members joining and leaving the military during that time frame. If the service member left the military but stayed with USAA as a veteran, their account as a veteran wasn’t included in the analysis, Diaz said.
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In other findings:
- 50% of service members paid their credit card bills on time and in full in 2023, compared to 40% in 2019.
- 37% of service members carried a revolving credit card balance for six months or longer in 2023, compared to 45% in 2019.
- As the pressures of inflation have mounted, service members are using credit cards more for some major essentials, the data showed. Credit card spending for grocery and pharmacy items increased by 32% in 2023, compared to 2019; by 36% for fuel; and by 13% for utilities.
Analysts didn’t didn’t delve further into the characteristics of the account owners, such as military rank, Diaz said, but they will pursue these additional characteristics in future analyses.
But they did conduct some comparisons by age, finding that Gen Z service members (ages 18-29) saw an average increase of 18% in savings balances over the five years, bigger than those of millennials, who saw a 6% average increase.
Meanwhile, millennials (ages 30-39) managed their credit more wisely. Their credit card balances were 23% lower than their pre-pandemic balances, compared to 11% lower for Gen Z troops.
One possible reason for the differences, the USAA analysts stated, is housing costs. They cited data from the National Association of Realtors noting that millennials are anywhere from five to seven times more likely to be a homebuyer in 2024 than Gen Zers.
This analysis sends a positive message about financial well-being in the military, Montanaro said. “From a financial perspective, there’s a positive link between financial wellness and military service.”
Karen has covered military families, quality of life and consumer issues for Military Times for more than 30 years, and is co-author of a chapter on media coverage of military families in the book "A Battle Plan for Supporting Military Families." She previously worked for newspapers in Guam, Norfolk, Jacksonville, Fla., and Athens, Ga.
