Posted on 08/15/2011 11:35:27 AM PDT by NoLibZone
A Pentagon task force is proposing the largest overhaul of the military retirement system in 50 years that will do away with a traditional pension system, opting instead for a 401(k)-style contribution program.
Under the newly proposed Defense Business Board plan, all troops would receive yearly retirement contributions if they served at least 20 years -- a stipulation of the existing system. The money, however, would not vest until service reached at least three to five years and would then be payable at retirement age. If personnel left before that three- to five-year mark, the time served would be rolled over into Social Security.
The central feature of the new DBB proposal would be a mandatory “Uniformed Military Personnel Thrift Savings Plan (TSP)” in which the contributions by the Department of Defense and the individual service member would be deposited. There is already a TSP program in operation, established by Congress in 1986 for both federal employees and service personnel. But those TSPs are voluntary and only include employee contributions.
The new TSPs -- functioning as a 401(k)-style account -- could include a government contribution amounting to as much as 16.5 percent of the member’s annual pay, as well as a maximum annual tax-deferred contribution limit of $16,500 by members. In addition, there is a $5,500 annual tax-deferred “Catch-up Contribution” for service people age 50 or older, and adjustments for those serving in a combat zone. The proposed DBB retirement program would not impact disabled veterans or current retirees.
(Excerpt) Read more at foxnews.com ...
Let’s bugger the troops yet again.
BOHICA!
Go ahead REMFers Swive w/ the retirement system and watch retention got to 0%!
So serving in the military less than 20 years would double fund social security? A member would have social security taken out of the regular paycheck plus the rollover amount??
I think this is a good idea in general, but why start with the guys who take bullets for us?
Why not the retired clerk typist at the Department of Ag?
Because Government is broken.
when meter maids on New Jersey have a better retirement plan than our fighting men and women, the country is doomed
The military should have a defined benefit pension plan. No other government agency, elected official, appointed official, judge, or public employee at any level in America should have one.
for some reason i couldn’t open link here. probably because it is Fox and everyone here is lib
BUt surely if they change this plan it would not take effect for anyone currently active. or retired.
I am not sure a 401K. line businesses is right. How many businesses send their people away from families for a year at a time, for several deployments AND put them in harm’s way, possible to die?
for that reason I think anyone who willingly does this for 20 years deserves a bettter retirement plan that aomeone who works for a company here in USA
Now that is something that needs to be explained. What is retirement age? Is that after 20 years service or 55? 65? If it is not after 20 years the military will have an impossible recruiting job ahead.
They tired messing with the retirement system once before in the 80’s and it didn't work.
Personally, I am beginning to think that 401(k)’s are a bad deal anyway. I have no idea how much money I have lost because of the stock market fluctuations over the years.
And I also believe that the markets now RELY on that influx of funds from all of the 401(k)’s every two weeks or so. The problem of course is that the money needs to be invested somehow to continue to build up for use by a retiree. Savings accounts aren’t it, you get taxed on savings plus inflation is a killer usually much higher than any rate of savings interest being offered.
The proposal is going nowhere.
This is nothing new. I heard talk about this 10 years ago.
Here’s a better idea.
Offer a 401K type contribution for all years less than 20 but a full pension at 20 years.
Give the military more benefits not less...
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If they don’t grandfather the troops that are already in, they should be sent to the Afgh/Pak border with a rusted rifle. Of course, I am opinionated because I have a son doing his 20.
This will eviscerate the Senior Enlisted ranks.
I am not sure about this, “Because they will have a problem with retention and be paying out monies to everyone who signs up for 3 or 4 years.”
doesn’t it say one wouldn’t be vested for 3-5 years
and if one left before they were vested the ampunt they paid would go into their SS account.
That I wouldn’t agree with since if you leave a private company now you get the money in your 401k and it is up to you to reinvest it.
Ithink parts of the plan are ok for people who do spend only 3-5 years but for people who stay for 20 their retirment should be better than most,
Your ppint about weiner’s scamming us is spot on.I’d rahter give a military retiree 50% of their base at 20 than give that POS weiner a penny
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