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LTC Stephen F.
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Edited >1 y ago
SFC Joe S. Davis Jr., MSM, DSL as I understand it the new pension plan options include a phased in move toward the 401(K) option. I would recommend that every soldier sign up for the new retirement program as long as they are able to select the investment vehicles because it is portable after they are vested [less than the number of years required to stay in to retire with pension]. With some basic financial retirement training they should be able to select funds which outperform the standard military retirement percentages. Hopefully this type of training will be made available to soldiers from trustworthy sources.
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Capt Tom Brown
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SFC Joe S. Davis Jr., MSM, DSL I am not a salesman for the services but probably should be on this one. The new program is an excellent deal for SMs and much better than many many private sector retirement and savings plans. Many private sector employees get no retirement, only what they can save on their own with little or no matching contribution. Hope new and younger troops will avail themselves of this program. Also glad to read that DoD is going to present an education program to inform and explain the program to all troops, rather than just let them absorb the information on their own.
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SSG Trevor S.
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Edited >1 y ago
Generally speaking, if the government asks you to "opt in" its a bad deal. A better idea is to take the same amount of money and invest it on your own, in a way that is not government dependent. This will keep the government from instating surprise penalties for early withdrawals then instituting negative interest rates to take all of your capital gains after taxing the capital gains. If you invest it yourself, then you will know any terms of early withdrawal penalties, and you will can make the decision to pay yearly capital gains so there is no IRA/negative interest rate/ penalties trap. On another plus side, if you do this on your own, and keep the current plan you will have a good retirement if you push through to 20 years on top of your investments.
*While negative interest sounds GREAT for borrowers, it is a horrible development for investors in bonds which are usually cornerstones in fixed income investment planning.
http://blogs.wsj.com/moneybeat/2016/04/14/what-negative-interest-rates-mean-for-the-world/
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