Military Is Overhauling Its Retirement Systems
- 7 years ago
Military Is Overhauling Its Retirement Systems
The new system still offers a monthly pension, but one calculated using a formula
that reduces it by 20 percent, said Michael Meese, a retired Army brigadier general and chief operating officer of the American Armed Forces Mutual Aid Association, a nonprofit group that provides insurance and other financial services to military members.
The system needed updating, the commission said, because the military’s current pension system leaves
the vast majority of service members with no retirement savings when they leave the military.
Both Mr. Andrews and Mr. Meese suggested that people who knew for sure
that they did not want to stay in the military for 20 years would probably benefit from switching to the blended system.
Service members with less than 12 years of service, however, must decide whether to move to the new system or remain in the old one.
“If someone is at the 10-year point,” he said, “it’s much less risky to stay in the old system than if you’re one to two years in.”
Those who are unsure of their plans, Mr. Meese said, have some hard thinking to do.
The new system still offers a monthly pension, but one calculated using a formula
that reduces it by 20 percent, said Michael Meese, a retired Army brigadier general and chief operating officer of the American Armed Forces Mutual Aid Association, a nonprofit group that provides insurance and other financial services to military members.
The system needed updating, the commission said, because the military’s current pension system leaves
the vast majority of service members with no retirement savings when they leave the military.
Both Mr. Andrews and Mr. Meese suggested that people who knew for sure
that they did not want to stay in the military for 20 years would probably benefit from switching to the blended system.
Service members with less than 12 years of service, however, must decide whether to move to the new system or remain in the old one.
“If someone is at the 10-year point,” he said, “it’s much less risky to stay in the old system than if you’re one to two years in.”
Those who are unsure of their plans, Mr. Meese said, have some hard thinking to do.