Posted on 07/26/2011 2:40:00 AM PDT by markomalley
A sweeping new plan to overhaul the Pentagon’s retirement system would give some benefits to all troops and phase out the 20-year cliff vesting system that has defined military careers for generations, the Military Times newspapers reported.
The plan calls for a corporate-style benefits program that would contribute money to troops’ retirement savings account rather than the promise of a future monthly pension, according to a new proposal from an influential Pentagon advisory board.
The move would save the Pentagon money -- at a time when it's being asked to cut at least $400 billion -- and benefit troops who leave with less than 20 years of service.
The yearly contributions might amount to about 16.5 percent of a member’s annual pay and would be deposited into a mandatory version of the Thrift Savings Plan, the military’s existing 401(k)-style account that now does not include government matching contributions, according to the Times.
Proponents said the plan would allow more flexibility for servicemembers, who could decide how they want to invest their retirement savings, and for the military, which would be allowed to offer higher contributions to troops who deploy frequently or take hardship assignments.
The Military Times has more on the proposed overhaul, including a summary of how servicemembers would be affected, depending on their length of service.
Yeah, I remember that “free health care for life” ploy. One of the reasons I joined. Now I hear complaints that the retired military don’t pay their fair share with Tricare (prime or for life).
No one ever mentions, though thatunlike their civvy job, Uncle Sam can yank yoou up at a moments notice and move you around the globe with nary a care for your loved ones. Lots of times, they plunk yoou down where someone is taking potshots at you!
I signed up for the total package, not a Bait and Switch!!!
Looks like Obama wants to change the Marine Corps into the Marine Corpse!
Oh, and thanks for your service! :)
I “retired” after 10 years...
Who wants to spend 4 or more tours in Afghanistan and Iraq or months away from contact with the family on a submarine because the employer offers a 401K plan
Wives will vote on this plan, too!
Let’s see how the TSP is “owning your own money”?
Timmy Geithner has been running the US govt since June on over $200 Billion confiscated from the TSP, which is why our natioonal debt already is over the so-called debt ceiling. ($14.5 Trillion, not $14.3 Trillion)
I can just see govt choosing where folks get to invest their TSP money...maybe in govt securities...and having even more money to raid as a slush fund.
Yes, Ask anyone whose retirement savings were in TSP and who retired at the end of 2008.
I assume Federal employees will also be giving up their pensions?
{Insert hysterical laughter here}
Ditto. Bailing on that promise was, and remains, a dishonest and dishonorable bait-and-switch.
Count me among those who retired at 20 years to-the-day. I'd have left sooner if it weren't for the retirement.
There is no doubt the present system needs revamping when todays salaries and benefits are weighed against what the draftee earned. We could begin by drastically reducing the number of senior officers and enlisted serving in slots once served very well by two pay grades lower. Why do you have to be an officer to drive an airplane? What the heck are ex airplane drivers doing commanding a surface ship? Why does a highly trained seal, nuke or you name it have the same base pay as a snuffy serving mid rats? We might want to consider doing something for retired folks tax burden. I for one, paid more in taxes than I earned in retirement for too many years before I finally hung it up.
It’s a good start. Having a portable retirement account would give servicemen more options at every stage of their career.
Now they can:
- do away with the “with dependents” bonus for BAQ. Why should someone get extra pay just because they have a spouse/children. There are already lots of fake marriages to glom this extra pay; imagine how much easier it will be to get this bonus with pretend gay relationships?
- Tie congressional pay (and staff pay) to the military pay scale.
1. Congresscritters receive basic E5 pay.
2. president, cabinet, house speaker would draw E7 pay.
3. After 10 years in “government service”, pay is permanently reduced to E4 level.
No one’s money is safe when you have thieves and thugs running the system. I hadn’t heard they were borrowing against TSP, but if they are, they deserve prison. TSP is taken from pay. It’s not their money.
You're right. When you reach the point where you have over ten years in, you set a goal to reach 20 and collect your retirement. Without that 20 year goal, a lot of good people will leave the service at the 10 year mark.
The military is underpaid already. Forcing them to set aside 16% of their income when they're already having trouble making ends meet is going to push a lot of them out.
We ask the military to separate from their families for a year or more at a time. Live in plywood shacks or tents in the middle of deserts. Get shot at and risk their lives. They're underpaid and over committed. Now the politicians want to give them a significant pay cut because they're an easy target.
How about cutting foreign aid to the muslim countries that are supporting our enemies? How about cutting some pork barrel projects. How about cutting some of the welfare payments. Quit spending money on illegal aliens. Get rid of the government agencies that haven't fixed the problems they were created to fix. Quit playing partisan politics with the defense spending bills and forcing the military to buy systems they don't want or need.
I have a grave issue with any “retirement account” that is controlled by the government directly. It reeks of social security - and the money will not be there any more than it is in the lockbox.
The laws about retirement accounts also mean that there will be no income after 20 years - the service member will have to wait until 57, like joe citizen.
It may be a cost saving measure, but I fail to see what good this will do for the military.
One more thing. I wouldn’t doubt that this will become another social security-type piggy bank for congress to spend freely and replace with IOUs.
Ahhhhh...another plan to shore up the stock market so that all those good GS employee Democrat voters can maintain their retirements.
>>I don’t know about anybody else, but there’s no way I would have stayed in 20 if the retirement system didn’t exist.
Unbelievable! Twenty years in the military is harder than 40 years in most careers. You’d think that the Pentagon would know that! I wonder if, as part of the “corporate retirement” plan, they’ll also start paying overtime for all hours worked over 40 in a week? If they did that, the military wouldn’t need a retirement plan!
This is just another part of the conversion to a Soviet-style economy and way of life. In this case, they will create a military full of professional officers and conscript enlisted.
True, but that's not the real issue. Being in the military, particularly as an enlisted, is a form of voluntary servitude. When you are signed on, you're signed on.
In any civilian job (to my knowledge), if you have a situation that you do not want to deal with (idiot boss, immoral policies, being ordered to do dangerous tasks, family problems, not being paid on time, etc.), you can say "f-u" and walk. Sure, your pay stops. Sure, you might get blackballed. But you have the option to do that.
In the military, if you do that, you are called a "deserter" and a "coward." You can get court martialed for that. If you leave, you will not only have your work looking for you, in order to arrest you, but you'll also get your picture in the post office and have the full weight of the federal government with the full cooperation of the state governments and, possibly, friendly foreign governments looking for you.
And that is the way it should be.
But that right there is the biggest difference between any civilian job and the military. And that right there is the reason, IMHO, that the retirement system should be retained.
"REDUX", the 40% plan, was implemented in 1986 [link] under Reagan. The first eligible REDUX retiree would have retired in 2006.
In 1999 (under Clinton), REDUX was withdrawn as the only plan for those entering the military in 1986 or later. Those military members have the choice at the 15 year point of either taking a $30,000 bonus and getting the 40% REDUX plan at 20 years, or forgoing the $30,000 bonus and getting the old 50% plan at 20 years [link].
Every government employee (including military and politicians) should be paid their full compensation up front at wages effectively set by taxpayers. Let the employees fund their own savings, benefits, and retirement.
Government employee pensions that are not currently funded are merely deficit spending, and taxing future unrepresented generations.
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