Can anyone explain how this budget affects pensions for military personnel who may be approaching their 20 years. Is it true that it reduces their pension until they are 62 yo. Promise Broken??
Can anyone explain how this budget affects pensions for military personnel who may be approaching their 20 years. Is it true that it reduces their pension until they are 62 yo. Promise Broken??
i don't doubt that this will hurt people. And i don't doubt that cutting social security coverage ore delaying the retirement age would hurt people. Actually i think the only reason social security hasn't been attacked (but should have been long ago) is the fear of a backlash from old people (who vote).
It will definitely hurt.... But it kind of has to. It's hard to avoid that now.
On the other side of that, the military's retirement system is just messed up. You could serve 20 years, leave at age 40, collect retirement and work? And correct me if i'm wrong, but continue to collect military retirement while working in a federal civilian position?
I love it. I'm 52, so I lose up to 1%/year for 10 years. I must have missed that briefing at Fort Know back in 1979. I am not employed and 100% VA disabled, but I'm working age. Yee Haa Still a great retirement, but not what I was sold. Next will be the 200% increase in my Tricare.
Well at age ~42 he would "retire" with 50% of basic pay, ~$50k/yr in todays dollars. So in that 10 year period between 10 and 20 year he would collect $500k in retirement benefits. A 401k only allows a max deferment of $17,500/yr so even if a company matched 100% and I am not aware of any that are currently being that generous but I am sure there are some, he would only receive $175,000 in retirement benefits in the private sector. This is definitely a simplified analysis that isn't including rate of return, inflation, opportunity costs, etc but $500k to $175k is a pretty big difference and the differerence will continue to grow after the 20 year point but at a slower rate.Why would someone with 10 yrs in, has a Masters in hand thanks to TA, stay for another 10 yrs, or 3-4 moves at least while enjoying only a 1-2% annual pay raise, and watching their retirement bennies erode?
Why would someone with 10 yrs in, has a Masters in hand thanks to TA, stay for another 10 yrs, or 3-4 moves at least while enjoying only a 1-2% annual pay raise, and watching their retirement bennies erode?
They could go corporate with a company that matches their investment via a 401K program at 32, at a comparable salary, never move again, and never have to do a no-notice deployment of 6-12 months. Nor do they have to worry that upon their death, the surviving spouse will need to have another financial investment (i.e. insurance) to pick up the financial loss. If Bullet dies tomorrow, come Jan. I will not get a penny from the AF regarding that retirement pay. In a way it is a financial crap shoot.
~~~ Most retirees know this and during their career plan accordingly, using companies like 1st Command and USAA for investment purposes.
Again, I don't begrudge our 20 year vets a retirement benefit. After all, let's remember they EARNED this. Not only for their sacrifices, but that of military families. From my own youth...
* I remember us moving 13 times in one 6 year period; including 3 different kindergartens
* Countless missed holidays and family events/firsts
* The constant worry for health and safety of a parent
* The phone calls at odd hours where he simply had to go, and bringing clothes/food because he was working straight through for days on end
* Being transferred to places so rough and crime ridden that my mom actually bought a carried a gun because she was so afraid for our safety
* Selling both family cars on short notice (at a loss) to buy a single one because govt would only ship one to Hawaii, then orders changed again at 11th hour and not go afterall.
* Having our phones tapped and FBI coming to my school and outside our home
* And on and on and on....
Sometimes we forget that sevice members and their families face hardships that civillians simply do not endure. So again I say they've EARNED this "benefit"; especially given that the AD pay is simply on-par (at best) with the civillian world.
My point is that we shouldn't cry over the 05s impacted by cuts. Yes it will hurt, but they will be just fine. Instead, think about the broader military and what these cuts mean to those families.
Why would someone with 10 yrs in, has a Masters in hand thanks to TA, stay for another 10 yrs, or 3-4 moves at least while enjoying only a 1-2% annual pay raise, and watching their retirement bennies erode?
I would content, they haven't EARNED this.... they've just been promised it (the two are not the same.)