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Thread: Question for retirees and the future of military retirement

  1. #21
    Moderator MSG Glenn's Avatar
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    I get mine once a month. Direct deposit of course. I can't remember if I ever had a choice of twice monthly. I don't think so.
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  • #22
    Short Timer CWO Sharkey's Avatar
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    are the taxes great?
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  • #23
    Moderator MSG Glenn's Avatar
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    I wouldn't think any taxes are "great", Chief. But otherwise it all depends on the state tax combined with the federal. Our state taxes are by no means low in any way, shape or form, a regular tax hell here.
    Proud Dad of a US Army Airborne Ranger SFC
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    Former USN - Submarines, USS Chopper (SS 342) & Navy Diver, UDT 21
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  • #24
    Short Timer CWO Sharkey's Avatar
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    THIS IS RIDICULOUS!!

    Advisory Panels Say Military Benefits Unsustainable

    Advisory Panels Say Military Benefits Unsustainable
    Tom Philpott | August 05, 2010


    Advisory Panels Say Military Benefits Unsustainable
    A consensus is building among current and former military leaders and defense industry executives that rising military personnel costs threaten the viability of the all-volunteer force.
    In July, two separate advisory groups reached the same general conclusions regarding what needs to be done to sustain the force. In the nearer term, they say, one step that must be taken is to make military retirees pay more out of pocket for their health care benefit.
    "Unless retirees contribute more for their TRICARE insurance, medical costs will not be brought under control and the national defense they served, and for which they fought and sacrificed, will be harmed," says the final report of the Quadrennial Defense Review Independent Panel.
    The panel is co-chaired by former Defense Secretary William J. Perry from the Clinton administration and Stephen J. Hadley who was national security advisor through President George W. Bush's second term.
    Longer term, and for the future force, panelists say, work must begin on designing new retirement, compensation and promotion systems to replace inefficient and rigid systems adopted after World War II. The situation is so critical that the Hadley-Perry panel asks Congress to establish a new National Commission on Military Personnel to lead the reform effort.
    Arnold Punaro, a defense industry executive and retired Marine Corps Reserve major general, chairs a task force for the Defense Business Board that will deliver its final report to Defense Secretary Robert Gates in October.
    Task force "initial observations" for cutting defense costs through best business practices, briefed to the board July 22, reinforces the notion that personnel accounts must be brought under control by modernizing retirement, pay, health benefits and the "up-or-out" promotion systems.
    Both studies deal with a far wider range of initiatives to restructure forces and streamline organizations. The Hadley-Perry report can be read online at http://www.usip.org/files/qdr/qdrreport.pdf, and task force observations are at Defense Business Board | Meetings.
    What both conclude on the need to control health costs and modernize compensation systems, Punaro said, is consistent with findings of the 10th Quadrennial Review of Military Compensation and the 2006 Defense Advisory Commission on Military Compensation. But now, with Defense Secretary Gates' leadership and a new awareness among military leaders to the burden of mounting personnel costs, there's a fresh groundswell for change, he said.
    "I've heard a four-star military leader comment that DoD is turning into a benefits company that will occasionally kill a terrorist," Punaro said in a phone interview Tuesday. The remark plays off a popular critique of General Motors before its recent bail out, that union contracts had transformed it into a health care company that occasionally built a car.
    Both the business board task force and the Hadley-Perry panel agree that the current force must be protected from the changes to retirement, pay or promotion policies needed to create a more efficient future force.
    "Updating military compensation and redesigning some benefits does not necessitate cuts in pay or benefits for current service members," said the Hadley-Perry report.
    "These are areas where any adjustment you make will take decades to change," Punaro said. "With something like military retirement, you are not going to break faith with people who joined expecting a certain benefit, even though only 20 percent stay long enough to earn a retirement."
    But rapid expansion of military entitlements has become part of "the nation's mandatory spending problems," the task force found. Among "significant unsustainable trends" that the task force listed is paying military retirees and their families "for 60 years after they have served only 20."
    Another task force slide give details of how military entitlements have expanded "rapidly" over the last decade with Congress passing TRICARE for Life, a more robust pharmacy benefit, concurrent receipt for disabled retirees, extra-size active duty pay raises, an improved survivor benefit plan, sharp growth in housing allowances, a bigger death gratuity and more.
    Punaro declined to criticize any specific initiative. But, he said, "nobody ever sat down and said, 'What's the cumulative effect of all this?'"
    The effect, says the Hadley-Perry report, is personnel costs "have grown drastically on a per capita basis."
    As the economy recovers and the job market rebounds, Punaro said, the cost of sustaining the military will accelerate even more.
    Punaro, who served as staff director of the Senate Armed Services Committee for eight years, noted that much of the recent entitlement growth has helped only retirees and their families, a population that now outnumbers the active duty community.
    "TRICARE for Life, the largest new benefit ever passed, was not subject to any kind of serious review or debate, as best as I can tell. Is that the way to pass something like that? And, okay, just because you passed it, does it have to be in existence for 100 years? Bob Gates makes a pretty compelling argument that 'health care costs are eating us alive'."
    Punaro criticized military associations that, he said, push continually for benefits with little heed to more pressing defense priorities. Military leaders and lawmakers this decade have been complicit, he suggested.
    "It doesn't take a profile in courage to stand up and be for every benefit that anybody has ever dreamed up. That's easy. It takes a lot of courage to be responsible...It looks to some of us that we've changed the slogan 'Praise the Lord and pass the ammunition' to 'Praise the Lord and pass the benefit.' I remember working with military associations when their number one goal was a strong national defense, not more benefits."
    To comment, e-mail milupdate@aol.com, write to Military Update, P.O. Box 231111, Centreville, VA, 20120-1111 or visit: www.militaryupdate.com.




    Advisory Panels Say Military Benefits Unsustainable - Topic Powered by Social Strata Panels Say Military Benefits Unsustainable&x_dpp=Y&x_link=http://www.military.com/features/0,15240,218378,00.html

  • #25
    Senior Member Grunt Medic TXARNG's Avatar
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    That's correct. Healthcare is a right for all Americans - but you gotta pay for it, even if you were promised it for free as part of your retirement benefits. Remember that when the President's "Universal Health Care" plan is implemented.
    68W4P, 31B4P, 0341, 0844
    24 years and DONE!!!

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  • #26
    Short Timer CWO Sharkey's Avatar
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    This weeks Army Times article on what is being proposed as the future for military retirement (this is the latest on the same ole). To change to a corporate type of plan and hold that to military expectations is unfair. This is simply screwing the new generation of military members. 401K fluctuates and you cannot get the same returns as serving 20 years and getting a lifetime pension starting in your late 30s/early 40s.

    Chief

    A plan that replans your retirement

    Defense panel would phase out 20-year pensions, bring in TSPs




    By Andrew Tilghman

    atilghman@militarytimes.com

    A sweeping new plan to overhaul the military retirement system would give some benefits to all troops and phase out the traditional 20-year cliff vesting system.

    The plan drafted by an influential Pentagon advisory board, which could affect today’s troops, calls for a corporate-style program that would contribute money to retirement sav­ings accounts rather than promis­ing a monthly pension.

    All troops would receive the yearly retirement contributions, regardless of whether they stay for 20 years. Those 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.

    A critical new feature would adjust those contributions to give more money to troops who deploy frequently, accept hardship assignments or serve in high­demand jobs. It would also give the services a new tool to entice troops to leave or stay longer.

    The new proposal was unveiled July 21 by the Defense Business Board, the wellspring for many cost-saving initiatives adopted by the Defense Department in recent years. The plan would mark the biggest change in military retire­ment in more than 60 years and require approval from Congress.

    “The current system is unfair, unaffordable and inflexible,” said Richard Spencer, a former finance executive and Marine pilot who led the board’s eight-month retire­ment study.

    This alternative would “enhance the ability of the service member to build a meaningful retirement asset [with] complete flexibility for their lifestyle or desires,” he said.

    It’s unclear whether troops would have immediate access to all the retirement money or whether it would be partially or completely withheld until a tradi­tional retirement age, such as 65. Under the current TSP, troops cannot withdraw money until age 59½ without incurring a signifi­cant penalty, except in certain specified circumstances.

    Fairness is a key factor, Spencer said. Along with saving money, the new plan offers significant retire­ment benefits to the roughly 83 percent of troops who leave service before reaching 20 years.

    Pressure is mounting

    The far-reaching proposal comes at a time of immense pressure on the military to cut spending. Pres­ident Obama has talked of cutting $400 billion over 12 years, while some proposals in play on Capitol Hill call for cutting $800 billion or more over the same period.

    Military retirement costs have soared in recent years because of rising life expectancy. If not con­tained, they will eventually “undermine future war-fighting capabilities,” Spencer said.

    A new system may allow the mil­itary to make rapid changes in the size and structure of the force. For example, troops with 15 years of experience are likely targets for downsizing, and this plan would provide them with a significant retirement benefit, Spencer said.

    The proposed change would have no effect on retirees or disabled veterans.

    Most private-sector companies contribute 4 percent to 12 percent of base pay into an employee’s retirement savings account. The current military retirement bene­fit — for those who ultimately get it — equals a 75 percent contribu­tion each year, the board said.

    The board considered keeping the current system with some major changes but concluded that those changes would not save enough money or fix the fairness and flexibility issues.

    Those changes included with­holding pension payments until a traditional retirement age; reduc­ing pensions to 40 percent of basic pay rather than the current 50 percent; or calculating retirement pay based on average basic pay over a member’s last five years in uniform rather than the current three years. The changes would save about $254 billion over 20 years, the board said. □
    Iraq/Afghanistan Veteran (OIF V & OEF X & XIII)
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  • #27
    Short Timer CWO Sharkey's Avatar
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    Another article

    DoD panel calls for radical retirement overhaul - Army News | News from Afghanistan & Iraq - Army Times

    DoD panel calls for radical retirement overhaul




    By Andrew Tilghman - Staff writer
    Posted : Monday Jul 25, 2011 13:24:26 EDT

    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.
    In a massive change that could affect today’s troops, 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.
    All troops would receive the yearly retirement contributions, regardless of whether they stay for 20 years. Those 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.
    FEEDBACK

    Tell us what you think. Email retirement@militarytimes.com


    A critical new feature would adjust those contributions to give more money to troops who deploy frequently, accept hardship assignments or serve in high-demand jobs. It would also give the services a new lever to incentivize some troops to leave or stay on active duty longer.
    The new proposal was unveiled July 21 by the Defense Business Board, the wellspring for many cost-saving initiatives adopted by the Defense Department in recent years. The new retirement plan would mark the biggest change in military retirement in more than 60 years and require approval from Congress.
    “The current system is unfair, unaffordable and inflexible,” said Richard Spencer, a former finance executive and Marine Corps pilot who led the board’s eight-month retirement study.
    This alternative plan would “enhance the ability of the service member to build a meaningful retirement asset [with] complete flexibility for their lifestyle or desires,” Spencer said.
    It’s unclear whether troops would have immediate access to all the retirement money or whether it would be partially or completely withheld until a traditional retirement age, such as 65. Under the current TSP, troops cannot withdraw money until age 59½ without incurring a significant penalty, except in certain specified circumstances.
    Fairness is a key factor, Spencer said. Along with saving the Pentagon money, the new plan offer significant retirement benefits to the roughly 83 percent of troops who leave service before reaching 20 years.
    Unlike other proposals to overhaul military retirement that would grandfather current troops, the board suggests that DoD could make an “immediate” transition to the new system, which would affect current troops quite differently depending on their years of service:
    • Recruits. The newest troops out of boot camp after the proposed change would have no direct incentive to stay for 20 years and would not get a fixed-benefit pension. Instead, they would receive annual contributions to a Thrift Savings Plan account and could leave service with that money at any time — although under current rules, they can’t withdraw the money until age 59½ without paying a penalty, except in certain specified circumstances.
    • Five years of service. Troops would immediately begin accruing new benefits in a TSP account. If they remained in service until the “old vesting date” — the 20-year mark — they also would get one-fourth of the “old plan benefit,” or about 12 percent of their pay at retirement, as an annuity. If they separated, for example, after 10 years, they would walk away with no fixed-pension benefit but would have a TSP account with five years of contributions.
    • 10 years of service. Troops would immediately begin accruing new benefits in a TSP account. If they remained in service for 10 more years, they would receive half of the “old plan benefit,” about 25 percent of their pay at retirement, as an annuity. If they separated after 15 years, they would walk away with no fixed-pension benefit but would have a TSP account with five years of contributions.
    • 15 years of service. Troops would immediately begin accruing new benefits in a TSP account. If they remained in service for five more years, they would receive three-fourths of the “old plan benefit,” about 37.5 percent of their pay at retirement, as an annuity.
    • 20 years and beyond. Troops who stayed in past 20 years would continue to receive annual TSP contributions.
    The far-reaching proposal comes at a time of immense pressure on the military to cut spending and help reduce the national debt. President Obama has talked about cutting $400 billion over the next 12 years, while some proposals gaining support on Capitol Hill would call for cutting more than $800 billion over the same period.
    Military retirement costs have soared in recent years because of rising life expectancy. If not contained, they will eventually “undermine future war-fighting capabilities,” Spencer said.
    A new system may allow the military to make rapid changes in the size and structure of the force. For example, troops with 15 years of experience are likely targets for downsizing, and this plan would provide them with a significant retirement benefit, Spencer said.
    The proposed change would have no affect on current retirees or disabled veterans.
    Most private-sector companies contribute 4 percent to 12 percent of base pay into an employee’s retirement savings account. By comparison, the current military retirement benefit, for those who ultimately get it, amounts to a 75 percent contribution each year, the board said.
    The board considered keeping the current system with some major changes, but concluded that those changes would not save enough money or fix the fairness and flexibility issues.
    Those changes included withholding pension payments until a traditional retirement age; reducing pensions to 40 percent of regular pay rather than the current 50 percent; or calculating retirement pay based on the average pay over a member’s last five years in uniform, rather than the three years under the current system. Those changes would save about $254 billion over 20 years, the board said.
    Iraq/Afghanistan Veteran (OIF V & OEF X & XIII)
    101st Airborne Division & 4th Infantry Division combat vet
    Serving overseas

  • #28
    Senior Member Angriff's Avatar
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    Would this affect only recruits coming into the Army after (if) this takes effect?
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  • #29
    Short Timer CWO Sharkey's Avatar
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    We do not know who will be grandfathers if these changes are approved.
    Iraq/Afghanistan Veteran (OIF V & OEF X & XIII)
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  • #30
    Senior Member Angriff's Avatar
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    If current members of the military get forced into this new retirement package involuntarily it's complete BS. We joined under the assumption we would receive a monthly pension immediately after a 20 retirement.
    TANKER - That dusty, crusty, grease-covered, dirty, sweaty, bright-eyed, fuzzie-faced,
    haircut-needing, beer-drinking, underrated, over-worked, underpaid,
    oversexed, little shit, who can take a tank and do more battlefield damage in
    ten minutes than a Grunt squad can do all day.

    If you ain't Armor, you ain't shit.

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