Posted on Jun 12, 2016
CPT Current Operations Officer (J33)
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Interesting new and informative video came out from the DoD, which I encourage everyone to watch.

However, it got me thinking... does this change who we consider retired? Normally, that moniker is reserved for those who served 20 years of active service.

Does this change anything?

http://www.militarytimes.com/story/military/benefits/retirement/2016/06/11/military-retirement-plan-explainer-video/85747308/
Posted in these groups: Retirement logo RetirementDod color DoD
Edited >1 y ago
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SGM Steve Wettstein
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If you don't get a Blue DoD ID Card at the end of your service you are not retired military. With the new system, SMs might be getting money from their TSP but they won't be "Retired Military".
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CPT Current Operations Officer (J33)
CPT (Join to see)
>1 y
That's what sparked my curiosity. Will 20 years still be considered the cut off? Under the new 2018 plan, there is no 20 year plan, so it will be everyone getting more from TSP.
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SFC Daniel McIntire
SFC Daniel McIntire
>1 y
Agreed SGM! Retirement is a term that relates to termination of continued service. Certain incentives are included with this term (status, base accessibility, covered medical, discounts, etc). Completing an initial service term does not equal retirement; however, it makes one a veteran.
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LTC Stephen B.
LTC Stephen B.
>1 y
CPT (Join to see) - At 20 years there is still a retirement annuity, just reduced from the current system: 2% per year rather than 2.5%. If you don't make it to that point, you do not "retire" from the military.
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SGM Erik Marquez
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I understand your question and it's validity
Personally I just like the word retired at all in regards to a 20 year pension in the military

I have no data to back it up but my perception is very few military personnel actually retire after getting out of the service
My perception is most start a second career or at least continue to work in some sort of fashion

My background and upbringing presented me a different definition of retired
Thus after 28 years of military service I got out but I am anything but retired
So if the term mean something new yet again with this new system that affect me not the least
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SGM Erik Marquez
SGM Erik Marquez
>1 y
I apologize for the grammar and typos voice to text and on mobile no way to edit
On my way to go work another 18 hour day on a tarmac service and at the Texas sun teaching people how to ride motorcycles
Not exactly retired
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COL Vincent Stoneking
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The new system still has a defined benefit retirement component the kicks in at 20 years of active service. See CPO (Join to see)'s summary. If you don't make 20 years, you don't get a retirement. If you do, you do.

Retirement is still at 20 years. The primary changes are:
1. It is a SMALLER retirement
2. TSP is more important.
3. The .gov does TSP matching.

Whether I like the changes or not (I don't), it isn't throwing the old system away as many seem to think. Retirement pay still happens at 20 years. You can still tap into your TSP at the age specified by federal law.

More interesting to me, and I haven't seen it addressed, is what does this mean for Reserve retirements - where the pay doesn't start until 60. Will they also be reduced? Very luckily, I am grandfathered into the pre-"reform" system.
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LTC Stephen B.
LTC Stephen B.
>1 y
Yes, "non-regular" retirees still wait until age 60, adjusted for deployments, to draw their annuity. For the RC SMs, however, the dollars involved are much smaller. A 2LT makes about $400 for a drill weekend. 1% auto-match is a whopping $4. 5% member plus 5% match gets you to $40, $20 from you and $20 from your rich Uncle. An E5 with 8-10 years is at that same level, $400 for a drill while an E1 is about half that to start. However, since the RC annuity doesn't start until age 60, and TSP is available at that same age (by current law, anything can change) there isn't the same up-front 'reduction' that an AC retiree faces while waiting up to 20 years for the TSP portion to become available. I think the immediate cash-flow will be a bigger factor for drilling members, especially those that make less on a drill weekend would have at their regular job, and at times spend more to get to and from their unit than they get paid - will they be willing (or financially able) to give up a portion of what's left of their drill check after taxes, FICA, SGLI, etc, etc.?

The initial calculator will most likely be AC-centric because the numbers are easier, pay is the same every month while the RC has drill weekends, AT weeks, ADOS months and deployments, etc. to deal with. An RC calculator would have to be more complex, or would just run an assumption of 48 + 15 for 20 years.
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LTC Stephen B.
LTC Stephen B.
>1 y
Not sure if I directly addressed your question regarding non-regular retirement - yes, the multiplier in 10 USC 12739 will be reduced from 2.5% to 2%.

Title 10-ARMED FORCES
Subtitle E-Reserve Components
CHAPTER 1223-RETIRED PAY FOR NON-REGULAR SERVICE
12739. Computation of retired pay
(a) The monthly retired pay of a person entitled to that pay under this chapter is the product of- (1) the retired pay base for that person as computed under section 1406(b)(2) or 1407 of this title; and (2) 2½ percent of the years of service credited to that person under section 12733 of this title.
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COL Vincent Stoneking
COL Vincent Stoneking
>1 y
LTC Stephen B. - Thanks, all the more happy that I'm grandfathered.
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