1.If a COLA is, let’s say, 2% of base pay then 1% of that is chump change.
2.The example given was $3700 a year. Again; if the COLA was 2% that means base pay was $185,000
3.It appears you don’t understand the difference between a percent and a percentage point either.
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Sorry my friend, you’re having a mental block on this and not understanding it. The below quoted text is extracted from the article:
“...The average cut in pension payouts, INCLUDING COMPOUNDING INTEREST, for a retiring Army Sergeant first class, would be about $3,700 each year, according to the Military Officers Association of America. Over 20 years, the total losses could balloon to more than $80,000....”
I capitalized three words which mean that, in the article’s example, the $3,700 is the amount that this change in the law will have reduced the retired sergeant’s ANNUAL pension after a period of years compared to what it would have been in the absence of Ryan’s “Screw Military Retirees Act”.
$3,700 a year may be “chump change” to you, but to many of us it is not.
You do know there exists a statutory provision for NO negative COLA, for anyone, including the military, right?
There have been several years when COLA was 0.
There were a few years it was as high 10-14%.
If you did not retire at exactly 20 years, you worked each year thereafter, needlessly, for 50% of the income you were already fully entitled to receive.
Before you castigate me for my differing views of this “outrage”, you should know I am a USAF veteran, with two honorable DD214s.(I had a break in service, and volunteered for a total of two 4 year enlistments)
That said, if you are as smart as you think you are, you already knew Uncle Sugar was going to break up with you as soon as possible.
Pity the poor civilians who are still working now, and seeing negative results in their actual working wage incomes,(No COLAs for us) and still they(we) are forced to keep paying for Uncle Sugars schemes.
I'm older, and now qualify for the over 55 senior discount rates.
As a member of the “baby boomer” generation, albeit the tail end...I can tell you the reckoning is coming, on schedule.
And you complain about a 1% reduction in an unearned and a never guaranteed annual retirement pay raise formula?Are you sure you are a conservative?
You just can’t see that the article is in error which is what prompted me to post in the first place. Colas usually run in the 1%-3% range. Reducing 3% by 1% results in a COLA of 2.97%. Reducing a 3% COLA by one percentage point results in a COLA of 2%....See the difference? Now do you understand that a one percent reduction in the COLA is in fact chump change.
Compounding interest can really add up over a long period of time. The article, however, uses a period of one single year. Annual refers to one year. It does not mean “over a period of years”.
You do the math...Tell me how much an SFC would have to earn if a 2% COLA resulted in $3700 in a single year.
The article includes compounding interest in a 20 year total of over $80,000.
Again. This article is just factually incorrect. No one can tell for sure how extensive the damage to retirees will be based solely on the information provided here.