Why not convert ALL government and congressional pensions to 401K?
Here’s what I want to know. Why was it bad when Bush was President to take two percentage points of our Social Security withholding and divert it instead to a government-approved individual retirement account, yet it’s good when Obama is President to take those same two percentage points away from Social Security and allow people to spend it on consumer goods instead? Back in 2005, Democrats were decrying that denying those two points away from Social Security would not only bankrupt the system, but would leave people in the same predicament as Enron stockholders when they retire. Yet these same Democrats now talk about what a great idea it is to deny Social Security these same two points and let people spend it on the here and now instead of investing it for their retirement.
A 401K seems a pretty lousy tradeoff for the possibility of being killed or maimed for life while fighting at the behest the politicians.
After the military is shifted over, then the rest of the government will be forced to follow suit. 'If it's good enough for the brave men and women who protect America, it's good enough for you'.
But make no mistake. Either way, the military is shifting. The long term projections are catastrophic. The military will be utterly unaffordable if the system isn't reformed soon. There's no way around it. The old system, the one that exists now, is not long for this world.
Problem is we really can’t afford to pay someone a 50% of base pay retirement after only 20 years of service. What they really need to do is go to a 30 years before retirement or delay the pay out until after they reach 60. Either way, Congress is looking for costs to cut and military retirement is an easy one.
Have to save all those Democrats with money in mutual funds (teachers, firefighters, govt. employees). Put the military retirement in, then let the Democrats withdraw, leaving the military retirees holding the bag having paid off the Democrats.
It is in addition to retirement instead of in place of but they are offered.
The thing with a 20 year service is that you are likely to come out damaged. It isn't the military's fault, (usually) it is the nature of the job. And those damages usually get worse over time.
“let Congress try it out first — and then expand to other government employees who don’t risk lives while living under deplorable conditions and enduring long family separations”
Thanks for your service LTC Herring but your lack of research on this subject is embarrassing.