An overhaul of the U.S. military’s retirement system is gaining momentum and seems likely to eventually clear the House and Senate.
The details of the overhaul can be read here; but the proposal centers around a shift to a 401(k)-style system.
But if the overhaul passes, it could force career troops to make some tough decisions.
From the Military Times:
Some critics question the commission’s analysis that everyone would do better under its proposal — that young troops would get a retirement benefit for the first time, career troops would get a better long-term benefit and the whole package still would save the government billions of dollars each year.
[…]
Everyone in today’s force would soon face a choice: Opt into the new system and start accruing money in their own retirement savings account, or exercise a “grandfather clause” that would allow them to remain under the traditional retirement system and its promise of a more robust pension.
[…]
“I have not seen figures that make me comfortable to say that this new system will be the equivalent or better for what a service member who serves 20 or more years gets under the current benefit,” said Deirdre Holleman, the executive director of the Retired Enlisted Association.
“As of now, it looks like the new benefit for people who serve less than 20 is being paid for by cuts in the benefit for those who have served 20 or more.”
Read the Military Times’ detailed analysis here.
Photo by Brian Schlumbohm/Fort Wainwright PAO
