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Yo_Mama_Been_Loggin

(108,192 posts)
Wed Dec 27, 2017, 02:50 PM Dec 2017

Military retirement is about to get a lot more complex

More than 1 million members of the military will start 2018 needing to make an important financial decision, as the government rolls out the biggest change to military retirement since World War II.

Members of the US Army, Marines, Navy, Air Force and Coast Guard with fewer than 12 years of service will have to choose whether to stay on an all-or-nothing path toward a traditional pension after 20 years of service or to opt for a new "blended" retirement system that Congress approved as part of the 2016 National Defense Authorization Act.

The new system combines a 401(k)-style plan with a continuation bonus after 12 years of service and a traditional pension (albeit less generous than before) after 20 years. The upshot: Those who don't reach the 20-year milestone required to qualify for a pension -- which amounts to more than 80 percent of those who serve -- will no longer leave with nothing saved for retirement.

Under the new plan, those who do stay for 20 or more years will see a 20 percent cut in their pension payouts, though the difference should be offset in part by the contributions to the plan's 401(k)-style component. The changes, which amount to a test case for entitlement reform in the civilian world, are expected to save taxpayers billions and also boost recruitment efforts for millennials, who tend to change jobs more often but are reluctant about putting off saving for retirement.

https://www.msn.com/en-us/money/retirement/military-retirement-is-about-to-get-a-lot-more-complex/ar-BBHjt5a?li=BBnb7Kz&ocid=edgsp

Sorry but a cut is a cut. Saying that your 401k contributions will make up for it is garbage.

I grew up a military brat. We pretty much lived hand to mouth. I wonder were my dad would have gotten the money to contribute to a 401k.

The full retirement after 20 years is the benefit one gets for working for less and putting one's life on the line.

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Military retirement is about to get a lot more complex (Original Post) Yo_Mama_Been_Loggin Dec 2017 OP
Many Military Families Rely on Food Stamps While Many Military Contractors Are as Rich as Sultans dlk Dec 2017 #1
Not much longer, though Eliot Rosewater Dec 2017 #4
So glad my husband retired before they made the changes..nt helpisontheway Dec 2017 #2
I wish I could tell WHY this is happening, is it being done because of Trump and his team Eliot Rosewater Dec 2017 #3
Here is hint: "part of the 2016 National Defense Authorization Act" Lurks Often Dec 2017 #7
But since all bills originate in Congress,that means that this bill was designed by the GOP Congress politicaljunkie41910 Dec 2017 #11
Designed by GOP and passed with Democratic votes in both the House & Senate Lurks Often Dec 2017 #12
And its corollary, "taken as a whole, this is a detriment to those who make it to twenty years, LanternWaste Dec 2017 #22
Too many people leaving the military with nothing hack89 Dec 2017 #13
And yet, don't the majority of Military vote Republican ? OnDoutside Dec 2017 #5
No, it's about half and half. haele Dec 2017 #16
Thanks, that's a great post. I appreciate it. OnDoutside Dec 2017 #20
Thank you for spelling "oafkeepers" correctly! FSogol Dec 2017 #21
Trump screws Service Members Turbineguy Dec 2017 #6
Wrong, President Obama signed this into law Lurks Often Dec 2017 #8
Thanks for the correction. Turbineguy Dec 2017 #14
Trump can't, only Congress can repeal/replace what was signed into law Lurks Often Dec 2017 #15
FERS for the military DeminPennswoods Dec 2017 #9
"The full retirement after 20 years is the benefit one gets for Hortensis Dec 2017 #10
I see it as "This is the deal the govt made with the person Ilsa Dec 2017 #17
I signed up under the delayed entry program so I'd get the old GI Bill Kaleva Dec 2017 #18
I remember that. Was too young to sign up delayed entry, so I was offered "VEEP" haele Dec 2017 #23
Those on duty in 2017 have a choice between new and old retirement system. New personnel don't. Angleae Dec 2017 #19

Eliot Rosewater

(31,121 posts)
4. Not much longer, though
Wed Dec 27, 2017, 03:19 PM
Dec 2017

I just read that both ryan and mcconnell now admit they do want to end food stamps.

Look, they are going to kill some of us, that much is sure. When do the people REACT? Dont know.

Eliot Rosewater

(31,121 posts)
3. I wish I could tell WHY this is happening, is it being done because of Trump and his team
Wed Dec 27, 2017, 03:17 PM
Dec 2017

of traitors?

Was it in the works before trump?

politicaljunkie41910

(3,335 posts)
11. But since all bills originate in Congress,that means that this bill was designed by the GOP Congress
Wed Dec 27, 2017, 04:45 PM
Dec 2017

Also as the OP states, prior to this bill those who served but did not reach 20 years, got no pension at all. So this law was designed to make sure that those who serve, but left before they were retirement eligible, get something. As someone who did serve, but didn't stay long enough to retire, I think something is better than nothing.

 

Lurks Often

(5,455 posts)
12. Designed by GOP and passed with Democratic votes in both the House & Senate
Wed Dec 27, 2017, 05:18 PM
Dec 2017

and signed into law by President Obama.
Passed the House 370-58 on Nov 5, 2015; Passed the Senate 91-3 Nov 10, 2015
So while the initial bill may have been written by a Republican, given the vote totals, in the end it appears to have been an actual bipartisan effort.

Link: https://www.govtrack.us/congress/bills/114/s1356

As to the merit of the changes made to the military retirement system, taken as a whole this is an improvement for those who make it to 12 years, but do not make to 20 years.

 

LanternWaste

(37,748 posts)
22. And its corollary, "taken as a whole, this is a detriment to those who make it to twenty years,
Thu Dec 28, 2017, 05:01 PM
Dec 2017

"taken as a whole this is an improvement for those who make it to 12 years, but do not make to 20 years..."

And its corollary, "taken as a whole, this is a detriment to those who make it to twenty years, and make it past twelve years..."

But I get your narrative. It's damned consistent, so to speak.

hack89

(39,171 posts)
13. Too many people leaving the military with nothing
Wed Dec 27, 2017, 05:46 PM
Dec 2017

Because they don't do 20 years. The military can't promise every person who enlists thst they can dtay in for 20 years. With today's small force they don't need as many senior people. I'm the past they would have been forced out with no retirement savings.

haele

(12,676 posts)
16. No, it's about half and half.
Wed Dec 27, 2017, 07:59 PM
Dec 2017

You'd be surprised how many progressives there are serving in the military. There's just as large a contingent of Greenpeace and Sierra Club supporters as there are militia-loving Dominionist Oafkeepers. The progressives are just a lot quieter and actually get their work done.

For 3/4th of the people serving, the Military was pretty much way to get the education or training they couldn't afford either in time or money- and later to support themselves or family through the benefits they could get.
If forced between working three full time minimum wage jobs and still not being able to get ahead, or signing up and getting paid a living wage (for a single person, at least) while you get training, full benefits, unlimited sick and 30 days paid leave - and with the option to access paid college up to graduate level if you stuck with it for a few enlistments, what would you do?
That's why most people joined. Not because they were particularly patriotic or rah-rah-kill-them-all types.

Haele

 

Lurks Often

(5,455 posts)
8. Wrong, President Obama signed this into law
Wed Dec 27, 2017, 04:17 PM
Dec 2017

Here is hint: "part of the 2016 National Defense Authorization Act"

It was signed into law by President Obama on Nov 25, 2015

Link: https://en.wikipedia.org/wiki/National_Defense_Authorization_Act_for_Fiscal_Year_2016

Turbineguy

(37,365 posts)
14. Thanks for the correction.
Wed Dec 27, 2017, 05:58 PM
Dec 2017

Still, if it was an Obama thing, why didn't trump overturn it? I thought everything Obama = bad.

DeminPennswoods

(15,290 posts)
9. FERS for the military
Wed Dec 27, 2017, 04:29 PM
Dec 2017

This is essentially the same pension benefit package civilian federal civil servants have been getting since 1984. Smaller basic pension and "save on your own" via 401k (I'd bet there's a govt match to savings) and investment (I'd bet Thrift Savings Plan).

Hortensis

(58,785 posts)
10. "The full retirement after 20 years is the benefit one gets for
Wed Dec 27, 2017, 04:37 PM
Dec 2017

working for less and putting one's life on the line."

Basically yes, though I have problems with both the "working for less" (just plain very, very wrong) and the pretense that everyone puts his life on the line (a conceit those who never worried about that are welcome to as long as I don't pay for it). Those who do, or could realistically be called on to and know it, or just those who are given no choice but to work in 110 degree summers and more, are a different matter.

In any case, we owe our military people (enlisted anyway, officers do just fine) more, not less. And that's one basic reason I've never voted for a tax decrease in nearly 50 years. We have big debts we haven't paid.

Ilsa

(61,698 posts)
17. I see it as "This is the deal the govt made with the person
Wed Dec 27, 2017, 10:19 PM
Dec 2017

who signed up." This is the contract they made, and the govt needs to honor it. Changing the terms mid-stream for people is wrong. Changes should only apply to new recruits so they know what they are signing up for.

Kaleva

(36,341 posts)
18. I signed up under the delayed entry program so I'd get the old GI Bill
Wed Dec 27, 2017, 10:28 PM
Dec 2017

Some years later Congress changed the rules so that I, and many others, who didn't use the old GI Bill by a certain date, because we were still on active duty, lost those benefits.

So when I did get out and went to college, I ended up paying out of pocket for all expenses.

haele

(12,676 posts)
23. I remember that. Was too young to sign up delayed entry, so I was offered "VEEP"
Thu Dec 28, 2017, 05:16 PM
Dec 2017

What a crap program that was for people who got deployed a lot. I started it, but cashed out when it was clear that the limitations for its use made it nothing more than a tax-deferred CD for most people - if you couldn't take the time for those college/university courses when you were in, it was worth about as much as an IRA once the fees (because you didn't use it at an approved learning facility) were taken out because you only had five years to use it after you got out - and if you couldn't afford to put aside the money in the first place, why put into it.

The Montgomery GI Bill was better, but it still retained that old "if you didn't use it within 10 years, you lost it." IME, most people spent those first 10 years after their enlistment trying to get another career up and running, and didn't have time to take a couple years off to get a BS or BA. I didn't have time to get back to serious university coursework myself to attempt to get a degree until I had been out for 12 years.
I know people who are just starting up on finishing their degree and it's been over 20 years - with that GI bill they thought they had access to now taken from them.

Haele

Angleae

(4,493 posts)
19. Those on duty in 2017 have a choice between new and old retirement system. New personnel don't.
Wed Dec 27, 2017, 11:56 PM
Dec 2017
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