Sound Off! What do You Think of the Proposed Overhaul of Military Retired Pay
Aug 12 2008
The Quadrennial Review of Military Compensation (QMRC) is again recommending a major overhaul of military retired pay…postponing receipt of full retired pay to as late as age 57 for an active duty retirement (along with raising TRICARE fees on pre-65 retirees and other changes).
Some of the major details can be found at MOAA Legislative Take of QMRC 2008 Recommendations
Clearly this would be a huge change to the current system and take much of the advantage to a 20-year career of sacrifice and family separation away…
Let us know what you think about these new proposals.
Hypothetically, if this were to pass, would it apply only to those individuals joining after that date, or would it be retroactively applied to everyone?
At 11 years time in service, one of the major factors in my decision to remain on active duty during these demanding times is the financial flexibility that the current retirement system provides.
That immediate paycheck upon retirement will allow me to get a job doing something I truly enjoy, even if it doesn’t pay that much. Having to wait until age 57 to draw benefits would severly restrict my choices of a second career.
Bottom line: Will current servicemembers receive what they were promised when they took the oath, regardless of any future retirement overhauls?
They have to be kidding!! This might work with Reserve or National Guard soldiers (baring multiple active duty tours), which I believe is current, but not for active duty troops. I would not have stayed for 30 if this had been the name of the game. How can one know they will transition to a comperable paying job when they leave the service?? Leave the serivce with no income……………….and little money saved. Between the 20th and 30th year is when most money is spent on kid’s education, and living expences, with little left in savings. Savings are accumulated when the chickens leave the roast!
I can’t imagine retention of career troops with that criteria!
This is only a panel’s recommendations so none of the implementation details have been thought out. We are concerned about these proposals so keep up to speed as we follow and counter any actions concurring with the ideas.
Once again the “powers that be” are trying to “muck” with an active duty retirement system which is fair and does a reasonably good job in retaining personnel. I believe the proposal will be highly detrimental to retention. What “might” work, using the present retirement system, is to modify it slightly. If an individual is “forced out” due to “manpower reductions”, he/she should receive a reduced retirement, either in lump-sum or monthly increments based on time in service, rank, and pay at time of separation. If that individual chooses to switch to inactive reserve status ornational guard, their active service military retirement entitlement should be transferred over to their new reserve/national guard retirement and should be deferred until their reserve/national guard retirement.
There are two incompatibilities here — Promotion Schedules and Pay and Retirement Schedules. From the top down Promotion appears to be more important and we will schedule Pay and Retirement to keep the Promotion intact. That is, as we used to say, bass-ackwards.
First, in terms of the needs of the service, qualified people come first. Back in the 1950s we in the Navy were told that enlisted people could be retained without being allowed to retire, for up to thirty years; officers, for up to forty years. That makes eminent sense.
Twenty years and out, failed promotion and out: both protect only the rank grabbers who fail to see the benefit of having competent but older people working for them. The military service is composed of people who become technically and intellectually more competent in their field as they age. There are certainly incompetents which have to be weeded out. They exist on civvy street as well.
The services have tried to conceal the failure of the system by creating contracts with civilian entities who hire at or before retirement age competent persons, opening the promotion field. The so called Beltway Bandits are paid retirement pay and get paid indirectly by the government the salary package handed them by the civilian contractors.
There is something radically wrong here. The military has not provided countless years of experience, education and training for the benefit of civilian contractors. That is not our mission. Within the armed services we find people who believe just that. They retire and use the embedded knowledge and their contacts in the active duty force on behalf of KKR or one of the others. They have become persons of mixed loyalty whether they are aware of it or not.
Now comes this new system which tests the loyalties of our people with sacks of cash. It leaves the promotion system intact. There are some who receive greater job satisfaction from the promotion system than from their professional expertise. Leadership does not automatically spring from rank. It comes from the demonstration of professional competence of the highest order and from the ability to find and motivate the most competent subordinates — regardless of their age or gender.
The services need to determine new ways to keep the services of these lower ranks not to find new ways to dispose of them. Serving in the armed forces is not a job. It is a way of life.
This topic, is like a diamond, and has – many facets. That should-not, and cannot, be overlooked.
Beginning with; how, where, and when – do we draw-the-line, on – FAIR & BALANCED, active duty, retirement and or disability benefits? Our COMPARABLE WORTH, Vs, that of the civilians, and federal/state employees.
The surest way to blow away, our benefits package(s), for Active, and Reserve, and Retirees. Is by making it, too expensive – up-front, for the American Public, and Congress. No matter how, we justify, our comparable worth.
And, once these new plans, are in place. They will be – next to impossible to change. They will often be – misinterpreted – just as they are now.
And, there will be another call – by Congress, and or the public, for overhaul – of they system.
Again, with the military member, taking the short-end, of the stick.
Historically, we already know that; the civilians, and Congress, quickly forgot/forget – the sacrifices, they asked – what they’re calling now – our Professional Military – to do. As well as; the promises, of future benefits/care, etc..
Which, with disdain, they discount, fritter away, dilute, and destroy.
As a now – former Disabled Veterans Employment, and Training Specialist, and case manager. I know that; we current, and past military members, need to look – outside-the-box. Taking into consideration, what will happen, as we select – our – and the future generations of military members – active, and or retirement – future life.
Some of whom, will be our children, and or – grandchildren.
Though many of us, may have found a way, – to make a great financial future for ourselves. And, have suffered, no major set-backs.
We need to look at, our comrades – who in the most time of need. Which is generally, at retirement, and old age – or at the time of receiving DISABILITY. Were unable to, or – LOST – their financial planning package. And, at that point, have had – NOTHING, to fall back on.
And, not necessarily because; they had – bad financial planning.
For some, it was because; they took the short – near future view. And, took incentives, or life’s planning packages, that didn’t fit, or work. Like the buy-outs, they used some years back.
For others, like all of us. There was/is no – CRISTAL BALL, to tell them/us – of the impending disaster, that may be, just around the corner.
We need to consider then, things like annuties. That will be long term viable, and have – a low – up-front cost, for the government, and or, for which we can – pay into, while, we’re serving, actively, on active duty, or while in the reserves.
The MOST IMPORTANT – of which, will be – all -the medical needs, of ourselves, and spouses – at retirement, and beyond.
Additionally, consider re-instating things like; the – old – commissary/PX system, of – post WW-II, the 50′s/60′s, which wasnt’ considered as, competing with, the civilian sector. And, gave us truly good prices.
Other things like; utilizing old/closed quarters on – old, or semi-closed bases.
Allowing the disabled, and other qualified retirees, to take a quarters allowance, out of – their disability, and or retirment pay, to pay for housing. The government residual cost, over – all facets of government spending – on the disabled, and or retirees. Should be minimal, and could be considered like; an annuity.
Let’s not – cut off our nose, to spite our face.
From an infantry perspective, I would have to recommend my son (and any other American son) find a different line of work if this comes to pass. Ground combat is far to hard on the body (even when not injured by enemy fire) to recieve a hardy pat on the back and a government promise of benefits in 15-20 years from the day you retire (assuming a 20 year commitment). I’m in year 12 of my career, and I would not stick around for this plan. The immediate payout upon retirement is a huge incentive for dedicating mind and body to military service. This new recommendation holds no such incentive for a reasonable person. The computer models will not adequately predict what will happen in 15-20 years under this plan. Funny thing about computer models, if they were so accurate, every gambler in Vegas would be rich, and we’d all have won a couple of lotteries. Not to mention the fact that those who designed those computer models will be long gone by the time it implodes. Your best and brightest will be gone at 10 years and one day – we don’t call them bright for no reason. Corporate America will love this plan, all the best and brightest they couldn’t get before will flock to them in droves. The US military will become the principal supplier for corporate executives and managers all over the world. The “brain drain” at the 10 year mark will ensure a lack of talent at the higher ranks – and/or – a lack of higher ranks period – and/or – extreme expenditure of crisis action money to repair the damage and provide monetary incentives within 10-12 years of initiating this awful plan. Let’s assume we implement anyway, whose going to deal with the lawsuits and bad publicity of a military that gave it’s veterans a whole lot less money knowing full well that only people who are ignorant of math and compound interest would take it or accept military service under this plan. The implementers of this plan didn’t just account for ignorance, they counted on it! By the time their ignorance becomes the raison d’etre of future trial lawyers, the original implementers will be long gone from public office and outcry. Like every other historical bad idea in this country (income tax, social security, medicare…) this one preys on the ignorant masses and provides plenty of time for the implementers to escape responsibility.
Having been retired 33 years ago at the age of 51 with 32 years of service, I can verify that the present system of retirement is marvelous. It works just fine and should not be fooled with.
I cannot imagine how anyone could survive under a system that would not start pay until age 60 or so. What would the retiree live on in the intervening years, when his children are in college, buying a home, etc? It is a real shock and can be a difficult transition and adjustment when first retired.
I tried to write my Master’s Independent Research Studon revising retirement. It was rejected my professors at the time told me I was crazy, why fool with a system that is working, the year was 1967. The Air Force was paying for my Master’s degree under the Minuteman Education Program at Minot Air Force Base. I had prior Air Guard duty credit but only from 1955 to 1958, after 1958 the credit was changed to points rather than whole years. So I was ableto retire with 21years 5months but with the Air Guard credit I retired with 24 years for credit. That gave me 60% at age 43 I could have stayed as a permanent Lt.Col but that would have given me only 15% for 5.5 additional years of service.I retired at 43 and went to work for a defense contractor, unfortunately was laid off at age 53, early retirment gave me $332.75 a month for 11 years of service with an ending salary of $62,000 a year. if I did have my military retirement I would be homeless. Leave the system alone. Give the guard and the reserve full year credit for their service, it will increase retention.
The current system works just fine for me, having retired in 1975 with 32 years of continuous service at age 51.
In my opinion, the proposed changes would not
Sucks. Quite frankly, though I disagree with former Sen Phil Gramm on many things, he is right about the whiners. We have gotten so use to having things and not paying for them that we are now trying to do less with less. this is a formula for eventual failure and decline of the country. If we want roads, we have to pay for them, if we want defense we have to pay for it, if we want retirement we have to pay for it. All of this points at higher taxes for somebody. there are lots of debates going on about how to do it but no one has had the guts to step up and make a proposal. If we want to prolong war, we have to pay the troops. the alternative is to go back to the draft but make it completely fair – no exemptions for the privileged. I have my retirement so I am not complaining for me. I do have grandchildren that may suffer under the results of the present system. In Texas we have a gasoline (used to be for roads) tax that the legislature now puts into the general revenue (to avoid tax increases) and we do not have enough to build or repair roads so the state has now contracted with foreign firms and borrowed money to build tollways. Maybe were are not whiners, just a bunch of numbskulls.
Had this system been in effect I would never had stayed a reserve offier for 29 years. I doubt I would have ever entered ROTC. Furthermore, the offer cash now for reduced benifits later simply takes advantage of someone’s lack of understanding of the economics of money. If someone were to perform this same trick on Monroe Street in Key West he would be arrested for a shell game. Dont take advantageof those who have served the best years of their lives in this way. To do so would simply dishonor the best.
If the projected cost savings is based on the computer modelling, then there are many “hidden” costs that have not been factored. A computer model is only as accurate as the data entered, and where radical changes to the current system are proposed, the modellers can’t possibly know all of the factors that will bear on future costs. I can’t help but think that this proposal will be more expensive than the current retirement system and if there are any savings realized they will be more than used up by increased costs through VA programs that will be needed to support the aging retirees who have not managed their “improved” benefits adequately. At the very least there should be a test period, but a test period of less than twenty years will only provide partial impact information, and what do you do at that point for all of the people whose careers have been sidetracked. I forsee serious retention problems if this program is implemented.
The current system has retained many fine people. It continues to work. If the proposed system had been in operation during my service, I would have sought other employment after 10 years. At 32, I would have gone for my CPA and started a more lucrative career. I enjoyed my service because I thought it was important and was being rewarded in a fair manner. I agree with one of the others that if this system is implemented, I would recommend to my grandchildern to serve their country for a two year period and then seek their career elsewhere.
It is important that people be educated as to the real cost of taking the cash and running. Too many see only the short term benefits. MOAA can help in spreading the word.
During my career in the Air Force, the key benefit I felt I had was the 20 year retirement system. That always made me feel I had a special contract with the American people and I tried my best to fulfill that contract. I felt it was a good deal for the country as well as for the military services as they could muster the best men and women in the country to serve during what most consider to be their must productive and resouceful years. This always seemed to be proven true as the American fighting force has been historically known throughout the world to rise to every challenge no matter where, when or what the challenge presents itself to be. Take the 20 year retirement system from our men and women in uniform and you take away that American contract proven beyond a doubt!
My Thought: It isn’t really broke, so lets fix it? I have a young cousin who professes great respect for my military career and his father-in-laws military career. But every now and then the resentment he feels about the military retirement package bubbles through. Why? Because he won’t receive it. Of course he is making far more money as a civilian with less responsiblity than I had even in the middle of my career. He makes ads for cars and all I did was sit nuc alert, fight in a war, move every few years and so on. If he was on a task force to redo retirement, his underlying agenda would be to treat the military retirement like what he expects as a civilian. Most firemen and policemen are eligible for retirement at 55 in my state. But every now and then some whiz kid thinks that age should be raised to save money from their overly generous retirement age. Just like I don’t want a 60 year old fireman trying to get me out of a buiding, I don’t want a 50 year old platoon sergeant trying to storm a machine gun. Before the up or out program was instituted, we had 50 year old Captains and 40 year old Lieutenants. Not good. Eisenhower was a very smart Lt. Col. and for the times very high in rank. He was expecting to retire at that rank before WW2 came along. I do agree that as a nation we seems to expect more and more entitlements, but without increased costs. Folks don’t seem to realize we can’t get there that way. Well, I guess it helps if you mess with the military program and cut those cost so you can start giving it to someone else.
Changing the retirement system and every other family support or benefits system that can be changed every few years is plenty of reason for anyone trying to make a career of the military a losing situation. The families of these career people are the losers. Most of the decision-makers do not know what the end results often can or will be. Many of the children are often deeply scarred by having to spend most of their lives associated with the military. It is my opinion that if a military person is required to be away from his home and family and possibly killed or badly maimed, then there should be no question that he should receive the best pension that DOD and congress can give him or her. A good start would be to take the best features of congressional retirement and the best features of government civilians and wrap them up into a package for the military. Some will say this is impossible or just plain crazy but I ask you to think why not? What about those 4000 guys we lost in Iraq? What were they worth?
In two words: IT STINKS!
- I would suggest a big reason many of the officers stick around until 20 years, despite the hardships of multiple deployments, PCS moves, despite watching our college peers work 1/2 as hard and get paid twice as much in the civilian world, and despite jepordizing our marriages and families is we get to start drawing retirement pay immediately and then can pursue a job we like on our terms as a part of the reward for faithful service to our nation.
- I hope the folks who drew up this plan also have a plan to double military pay at the same time, otherwise the plan will never get off the ground. Think about it, there is a reason a contractor gets paid 2 as much to do the same job as a serviceman does, or even more when he is in a combat zone.
- If you use a longer stick for the carrot in front of a mule, at what point will he fail to see it?
- A better answer to retain both enlisted and officer talent past twenty is the same thing we do to get them past 8, 10, and 12 years… bonuses, which can be added and removed as needed to shape the force as desired, in the fields needed.
I think it is another way for the civilian leaders at the Pentagon to screw the serviceman out of promises again. They keep say that it is our fault they don’t have enough money to spend for new weapon.. my take is, “How are those new weapons going to operate with reliable servicemen to operate them.” Beside we all know that with all the technology, we still new the ground pounder to in and finish the job on foot. I really gets my goat that they keep trying to find away to take more benefits away when their benefits are better than ours.
So I say we need to fight to keep it the way that it is and the civilian leadership needs some education on who they are really working for… I found out a long time ago that the reason they have a job in the first place is because soldier, sailors, airmen, marines and coast guard came first. It is not the other as if it was not for them there would not be servicemen.
All the promise they make they turn around and want to take them back.
They need to turn their thinking our around and start looking out for the Services.
Thomas W. Quinn, CSM Ret
Once again, another proposal that is as foolish as the Redux Retirement plan which turned out being a failure. I would never dedicate the 27 years of a Marine Corps career with the risks and personal freedom limitations imposed by remaining on active duty in anticipation of receiving a promised military retirement benefit effective on my date of retirement. I know several reserve military personnel who are not pleased with waiting until they are 60 to receive retirement benefits. This is further compounded by those reservists who are frequently called to active duty and put in harms harm more often than they anticipated for a retirement compensation that begins at 60.
Those of us who chose to remain on active duty for 20 plus years did so for many reasons. The primary reason for me was a 20 year retirement system that included immediate retirement pay and medical care on my retirement date. The proposed system is a pentagon economists dream and a career military individual’s worst nightmare. At a time when the services are having extreme difficulty in recruiting and retaining personnel, now is not the time to experiment with anything. There is nothing wrong with the current retirement system. It has proven its worth to retain the best and brightest of our population. It should not be experimented with or changed – PERIOD!
Since retirement pay is an issue for the QRC, guess what – what is to say our medical benefits are next! It would be reasonable that if a retired military person cannot draw retirement pay until 57 or 60, does that also mean that TRICARE medical benefits don’t start until 57 or 60 also??? This is another major impact considering that most retired military have mature families who are not able to take major reductions in pay and benefits at the time that they retire from the military. Many of our military careerists do not have highly technical backgrounds that lead to high paying jobs. How many people need an infantry E-6 to E-9 whose only experence is telling people what do, when to do, and how to assault an objective? Bottom line: Don’t muck with a system that retains people the military needs!
Here again is a group of “experts” trying to justify their positions by fiddling with a tried and true system. I entered the USAF at age 34, retired at age 61 because of medical problems–all service connected. The old adage applies, “If it ain’t broke, don’t try to fix it”. From a medical perspective the “proposed cure” will make the disease worse! I earned every penny of my retirement, and the VA disability I collect, and no civilian job ever could match the working conditions many of us endured. Think of MOPP 4 for a week, every 2 months, during a 3 year tour. The 12 hour day was routine for many years. No bonuses, delayed promotions, involintary tour extensions, shortages during the Carter “peanut years”, Clintons cuts, etc. I have a son coming up on 26 years in–presently deployed. He asks me what to do. I say get out PDQ before they change the rules!!!
Leave the retirement system alone.What the Military needs is a good demotion system where everyone has a chance to show the qualities that are essential for a continuing career.That way the Military is not subjugated to the down-sizing that takes place when administrations change parties or conflicts end.Too many individuals get stuck in a command/assignment where they don’t have the opportunity to advance.The up or out system results in the loss of many good and qualified people that were on the back side of the “power curve”–end of a war etc.Regarding lump-sum payments, early retirements,etc.;these ideas open up a new”can of worms”.Who is going to stay in if he/she can get a great job on the outside and only have to put in ten years for a limited retirement.?Because of the frequent deployments of all military,active;guard ;reserves; the divorce frequency has soared and any Military ex-spouse knows what its like to be “Blind sided” by “The Uniform Services Former Spouses Protection Act”At last count—400,000 and rising. So, take the lump-sum and run.
I have just one question. If the current military retirement system is so good, why do retired military members have to forfeit one half of their retired pay to former spouses. No other profession public or private are required to do so. Maybe congress realized that the life was so hard on the family that they deserved compensation as well as the member. The Pentagon is not looking out for the service member they are looking for ways to reduce the personnel cost.
Want to stop the fooling around with military retired pay? Form a committee of active duty senior officers and enlisted to review all the pay of all DOD employees as well as Congress. Not only will it stop all this nonsense every few years, but I’ll bet we can save a ton of money to boot.
Senator John McCain has expressed opposition to the ‘Enhanced GI Bill’ as it would encourage military members to leave ‘active duty’. This proposed military retirement plan encourages the early departure of active duty members.
So, what is the truth? Is ‘force stability’ less critical than decreasing the ever increasing national debt?
Many of our servicemen enter the service (such as I did) when they were barely 17 years old. To await 23 years after having accumlated 20 years serve to get that first retired pay check is cruel and unusual punishment. Unless you have been 37 years old trying to get a job (especially in recessive markets), you don’t know what that delay can mean. Many servicemen would happily stay beyond 20 years but they are forced out due to passovers or rating quotas. There must be a way to porotect them.
I think it is a travesty the way Congress misbehaves. They have a far better health insurance program than anyone else in the world. They have a retirement system that pays them their current salary for life when they retire. And their survivors continue to collect the same pay until they die. And they are exempted from social security.
Then they do everything they can to bite the hand that is protecting their very lives and freedom! They are shameless and are the very epitome of what we don’t want our children to grow up to become as adults. Power corrupts, and absolute power corrupts absolutely, as demonstrated by our elected officials.
And to top it all off, they blame it all on the President.
In the early 70s the Hubble Pay Plan was put forth where all allowances were to be put into the regular pay system by pay grade so the singles would make out since they would receive the same BAQ, Meals and all other allowances as marrieds, but the kicker was that the entire amount was taxable; however at 20 or beyond it was 2.5% times then number of years from 50% to 75%. It proposed to collect a ton of taxes on the front end to subsidize retirement on the back end but it was voted down for some stupid reason if I am remembering correctly. Ever since then with the High 3 and other schemes eventually it always went back to the regular retirement it has always been. Now this new idea where effectively when combined with a voluntary 401K type of deal people could affect the total take home at time of retirement. Well somebody needs to climb to the top of the highest mast and scream BOHICA for all they are worth. If you don’t know what BOHICA stands for ask an old timer.
Reservists spend just as much time in combat as active duty and receive a much reduced retirement after waiting to age 60. Even if we spend 22-30 years in the reserves with the possibility of activation, our retirement is calculated using only the days we serve. We do not get retirement credit for the 52 Saturdays, 52 Sundays and 30 days of days off. We do not get the 2.5% increase for every year beyond 20.
If a reserve unit is closed, a reservists has to find another position somewhere else or lose the chance at any retirement. This past couple of years due to force reductions the USAF sent active duty Captains out the door with $125k or more.
As someone who does not collect a retirement until age 60 this program does have merit. At least on the surface. I need MOAA to look at this through the eyes of a traditional reservist and explain why or why not we should not support these proposed changes to the retirement system.
Also, in civilian industry one can roll-over their retirement from job to job. Why shouldn’t a troop from any service be able earn money for retirement and then be able to roll it over if the only serve one enlistment?
Not good. One of the BIG attractions of a twenty [or more]-year length of service is the immediate retirement check thereafter. Having to wait for a dozen or more years would effectively negate its marketing value.
But my most emphatic statement would be to repeal the Retired Servicemen’s Former Spouse Protection Act (RSFSPA). It arbitrarily places the blame for dissolution of a marriage on the member’s shoulders and for that he or she must pay, from earned retirement compensation, “alimony” UNTIL DEATH. No other event will alter his or her obligation to forfeit as much as half of his or her retirement pay to a previous spouse, even if the spouse has remarried. No retirement plan for service persons is safe as long as that law is extant, and heroic efforts to get it repealed have met with strong resistance EVEN FROM THE SERVICES THEMSELVES. It’s disgraceful, cavalier disregard of basic rights.
Does this fall under the Quote if it ain’t broke lets fix it??
Will this apply to all “Federal Retirees”??
So much for the all volunteer Force. Reimplement the Draft! !
Thanks to everyone for their comments and concerns. We are passing your thoughts on to our legislative team to help provide them with an active duty perspective on this new “trial balloon”.
Please keep your thoughts and ideas coming and we will continue to work to maintain the current retirement system.
Phil