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Charlie Mike

Military Retirement: Too Sweet a Deal?

March 2, 2015

Retiring from the U.S. military is a sweet deal for the 17 percent of veterans who are allowed to serve for twenty years on active duty. Too sweet.

For decades, critics and top brass have warned that the Pentagon’s defined benefit pension (earned after 20 years of service) is growing exponentially more expensive. Annual outlays for military pensions exceed $50 billion and will double before today’s lieutenants become generals. Liabilities of the program are $1.3 trillion (roughly one tenth of size of the U.S. GDP) and will rise to $2.8 trillion in 2035.

As alarming as those numbers might be, fiscal woes are not the real problem. The real problem is that the military services need to modernize talent management, but they are stuck with this anachronistic pension structure.

As the Gates commission noted in 1970, the all-or-nothing vesting of the retirement benefit at 20 years isn’t fair and hinders talent management. Another problem is that benefits pay out immediately upon retirement instead of at 65 or some other fixed age. These sweet features distort work incentives on both sides of the cliff. Too many personnel stay in uniform before the 20-year cliff, and too few stay after.

Twenty years until vesting is four times longer than what is legally allowable in a private sector pension. Why? It is coercive. And it’s not just distorting the behavior of the employees, but the employers as well. In 1978, a few years after the All Volunteer Force was enacted into law, the U.S. Government Accountability Office (GAO) was calling for an end to the 20-year cliff in a clearly titled report, Retirement Security: The 20-Year Military Retirement System Needs Reform:

Twenty-year retirement, in conjunction with present personnel management policies, is an inefficient means of attracting new members, causes the services to retain more members than are needed up to the 20-year point, provides too strong an incentive for experienced personnel to leave after serving 20 years, and makes it impossible for the vast majority of members to serve full careers.

It made this argument repeatedly over the years, echoing other official studies. In 1996, the GAO warned, “the services have been reluctant to involuntarily separate personnel with less than 20 years of service.” In 2006, the Defense Advisory Committee on Military Compensation took aim at the status quo pension system as inefficient, inflexible, and inequitable. In 2011, the Defense Business Board issued a report that offered the latest harsh critique and proposed replacing the defined benefit entirely with a savings plan.

In contrast, the recommendation issued in late January 2015 by the Military Compensation and Retirement Modernization Commission’s final report offers no analysis of the distortionary effects of the status quo. It may be the first major commission in half a century to recommend leaving the defined benefit pension in place. The report’s mild recommendation trims the monthly benefit by one-fifth but adds a small savings asset, much like the 401(k) that many private sector workers save with a monthly match from their company. This reform will save Pentagon some money, but will not change behavior.

Consider these three charts.

The first is copied from the MCRMC’s interim report, and shows the continuation rate of officers in the Department of Defense and its four branches over the years of service (YOS) of current year group cohorts. There is a distinct retirement bubble at the 20th year.

Continuation rates by Year of Service
Figure 1. Continuation rates by Year of Service (from MCRMC final report). CLICK TO ENLARGE.

The second figure is copied from an Army War College report, and it shows the same data more clearly by breaking down the likelihood of separation for each year of service, which approaches zero until year 20 when it spikes dramatically.

Continuation rates by Year of Service
Figure 2. Continuation rates by Year of Service (from “A Framework For Restructuring The Military Retirement System,” July 2013). CLICK TO ENLARGE.

The third figure is mine, and one look explains the 20-year bubble. It shows the value of each additional year of work during an officer’s career, which escalates up to $1 million during year 20 and collapses during year 21. Every service member contemplating retirement is well aware of the money at stake represented in this third figure.

Officer’s value of work by Year of Service under current pension plan
Figure 3. Officer’s value of work by Year of Service under current pension plan. CLICK TO ENLARGE.

Let your eyes linger on Figure 3, because it explains in a picture what is broken with the current military retirement structure. The total expected value of retiring at 20 years is worth nearly a million dollars, which means that the last two years of work in uniform are worth roughly half a million each to a typical officer (annual base pay plus half of their retirement stream). The last five years from the 15-year point are worth a little over $200,000 per year. Basically, you would be crazy to leave so much money on the table during years 15-19. But then the value of work collapses in year 21, which is why more than half of all active duty troops who retire do so immediately after their 20th year. Over half.

I also modeled the value and cost of a completely new kind of military pension along the lines called for by the Defense Business Board’s 2011 report. I will explain it in more detail in a forthcoming Hoover Institution working paper. This “savings” pension would discontinue the defined benefit plan completely for new officers and enlistees, beginning instead at the five-year mark with a generous employer contribution to a savings account owned by the service member that equals 25 percent of base pay per year as well as a match of funds up to 25 percent of base pay. Yes, that’s 50 percent total from the government to an account you could access in full upon retirement. This is far in excess of the private sector norm, yet it would cost the military far less than the status quo. Under this plan, service members create an asset that will be more highly valued by the veteran retiree than the status quo defined benefit lifetime income stream, meanwhile saving the government $1.3 million per retiree.

The status quo likes the status quo. I’ve been warned by a few retiree friends that ending the 20-year defined benefit is risky because lots of mid-career talent would leave. True. But that’s the point. Flexibility is vital to talent management, and pension flexibility will enable a continuum of service in which individuals can leave and also re-join the ranks. When soldiers can move flexibly in and out of active duty roles, they are able to gain priceless skills in the private sector and also bridge the civilian-military gap, which is effectively impossible given the current pension structure.

By delinking retirement benefits from laying off (and hiring), force shaping by the Army, Navy, Air Force and Marines is suddenly much more flexible. There will be no more agonizing about forcing troops into early retirement, which is an anachronistic concept. Instead, the services can start thinking about their human capital in terms of skills and talents instead of year group cohorts.

When policymakers consider compensation reform, they must analyze options that break free from the defined benefit retirement structure entirely. It is a recommendation that is half a century overdue. It has been recommended by a dozen expert commissions. And it is the essential first step in modernizing the Pentagon’s talent management process.

 

Tim Kane is a research fellow at Stanford University’s Hoover Institution and has twice served as a senior economist on the Joint Economic Committee of the U.S. Congress. He is the author of Bleeding Talent. This research is made possible by a grant from the Smith Richardson Foundation. He is a former officer in the U.S. Air Force. 

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81 thoughts on “Military Retirement: Too Sweet a Deal?”

    1. Is this Duffleblog? I’m the canary in the coalmine. So PTSD I can’t work. Lost my house waiting for the VA. Been retired 20 years. Have never seen an increase in my pension. It is the same as it was in 1994. They threw us away. Like garbage.
      Why are they worth killing for? Please explain.

  2. For the bulk of the DoD, this idea might have a chance. In the community I was in when I retired (AFSOC helicopter pilot), it would be a disaster. That prospect of 20 years keeps the guys with all the experience (senior captains and majors) from leaving just when they have become really seasoned at the mission. Otherwise, why stick around after 10-15 years when you could get out and fly for DynCorp or Lockheed Martin or L3 and make big money as a contractor? Hell, I almost got out in 2001 at the 10 year mark, but stop-loss kept all SOF aviators on active duty until 2006, then I just did the last six years and retired in 2012.

    I agree that something needs to be done, but it is not financial, it’s cultural. If the military just becomes a slightly more frustrating version of working at IBM or Microsoft, then people will get out as soon as they can and find a better job. If the military is something unique and special (which I thought it was for the first half of the 90s), then guys will stick around. But military culture is changing and not for the better. So the rank-and-file (usually men from rural America) grit their teeth, put up with the PC insanity that has infested the DoD and punch out at 20. No mystery there, and the phenomenon will get worse for the next two years as well.

    Money is important, and you gotta support your family. But I didn’t fly helicopters for two decades and almost get myself killed on several occasions because of the anticipation of making 2700 extra dollars a month for the next 20 or 30 years. Nickels and dimes will only motivate fighting men so far, which is why the debate over retirement will always miss an important part of the puzzle.

    1. Pave Low John nailed it. Sure, we need the kids who come in to earn college money, get away from a bad home, or to prove themselves. But we also need the experienced NCOs and staff officers who have the experience and talent to execute missions and win wars. We keep thinking of this issue like it is a civilian corporation. WAR IS NOT BUSINESS and the military isn’t a corporation. If anything, athletes, executives, and movie stars are overpaid and the front-line warriors should be making the big bucks.

  3. Mr. Kane obviously does not understand the present purpose of the 20 year vesting point. First, service members must EARN the right to retire by advancing to sufficient rank to complete 20 years of active duty service. Second, the purpose of the 20 year compensation point is to retain talent within the ranks, not to provide a flexible investment strategy that permits service members to leave earlier.

    Perhaps the billions of dollars paid to citizens who never serve their nation should be under discussion rather than the earned benefits of military retirees.

    1. First and foremost, if the purpose of the twenty year benchmark is to retain the best talent, then the system leaves a lot to be desired. As Dr. Kane has demonstrated with multiple publications over the last few years, the DoD’s personnel management system for uniformed personnel is obsolete, and there’s a great deal of room for improvement in attracting and retaining the best talent. I would recommend that you and anyone else who’s interested in this topic check out Dr. Kane’s book, “Bleeding Talent”; his 2011 article in The Atlantic, “Why Our Best Officers Are Leaving”; and his 2011 lecture at the Heritage Foundation, “Is There a Military Leadership Crisis?”, for more information on the topic.

      Second, while I think most would agree that entitlement reform should be a higher priority than military compensation reform, your observation is a strawman. No one is suggesting that existing retirees’ deal be reneged upon, they are suggesting that the system for future retirees be reevaluated to ensure that it is both equitable and sustainable. That should be plain and simple common sense, particularly when one considers how much the military, society, the economy, and the job market has changed since the existing personnel management and compensation systems were put into place. Second, I suspect I’m not the only WOTR reader who takes issue with the suggestion that only those who wear uniforms “serve their nation” – a typical cliche uttered by many veterans, but one which does not reflect the contributions that civilians make to our nation, including but not limited to the national security mission.

      1. Tom, I am led to believe by your comments that you are or were a DoD civilian. It also seems that you would like to structure the military reitrement system after the GS thrift savings plan model.

        If we go that route, can I ask if we should then allow our uniformed members to become bargaining units like their unionized, civilian DoD counterparts? Could we then put the military on a time-card system and a 40-hour work-week like the rest of DoD? Would we offer them overtime for the months they spend deployed away from family and home?

        The notion that the uniformed services ‘defend the nation’ does not in any way demean or diminish the contributions of DoD and other government civilians. It does however recognize that there is a distinct diference. You cannot order a civlian to do anything that’s not in their position description, and I have yet to meet a GS employee that has “Take that hill” in their PD.

        If your only references on this topic are Mr. Kane’s writings, you are poorly informed.

        1. Justin: Thank you for your challenge. Your guesses about my background are understandable, but inaccurate, and rather than go into detail, I will simply note that I have yet to meet anyone whose background is comparable to my own. I am not advocating for the military retirement system to be restructured along the lines of the federal civil service’s thrift savings plan system. Unlike Dr. Kane, I am not intimately familiar with potential alternatives to the current system. However, based on my unique vantage point, I agree with Dr. Kane (and others – “Doctrine Man” being a good example) that the antiquated personnel system, and the retirement compensation system that accompanies it, are obsolete and need to be reformed if the uniformed services expect to remain competitive with the civilian job market and against America’s strategic competitors. I freely acknowledge that a new system would necessarily be tailored to the fundamental specifics of the profession of arms; however, the arguments against Dr. Kane’s observations in this comment thread strike me primarily as arguments for maintaining the status quo, rather than legitimate arguments derived from such fundamental specifics. In my experience, the military very consistently claims that “we’ve always done it this way is no excuse”, until an alternative requiring some level of discomfort is suggested, at which point “we’ve always done it this way” becomes the mantra. This seems like just such an occasion.

        2. From a current company commander perspective with 8 years, the retirement is what keeps me going. Dont get wrong I believe in American Exceptionalism and what I do, but to put up with the BS, random knee jerk reactions, the deployments, the lack of political resolve, the current retirement system to me is about $4-5 million account. I have several businesses: real estate, cattle, currency trading. I could make more money out the army focusing on my businesses, but I believe in what I do. I believe DoD pays a retirement for us to walk away, could you imagine giving Soldiers skills and expertise in killing and destroying and they go find something to make money at. Truth be told if I dont recieve some of compensation I will seek out my own, I will supply a demand and those businesses with the highest profit margin are illegal. George Washington understood pay and retirement.

    2. The military doesn’t want its talent leaving at the 10 year mark, but they don’t want the majority to punch out at 20 years and a day, either.

      Because the military pension pays immediately, there is limited incentive to stay past 20 years.

  4. I am not saying “no change”, but change must take into account that military service is unique as a field of employment. I retired after 24 years, just as my daughter was entering college. I got a good civilian job, but it still paid 25% less than I was making on active duty (which is what you should expect when starting a new career–not a lot of armor jobs in the civilian sector). Without the immediate payout of a pension earned by going where others did not want to go and doing that which others were not able or willing to do, I would have been in a deep financial bind. The 20 year retirement was not what motivated me to serve, but it is what made it financially possible for me to serve so long. I am not saying “no change”; I am saying that you better understand the impact to maintaining an experienced corps of long service NCOs and officers.

    1. Your argument would have carried more weight in 1990, as it conveniently omits the fact that personnel deployed abroad in traditional military careers have increasingly come from the ranks of the civil service and private industry in the last two decades. Some of these folks have even borne arms against the enemy, though usually in defensive, vice offensive, roles. That “military service is unique as a field of employment” is a cultural prerogative, rather than an ironclad historical imperative.

      1. And your argument would have carried more weight if you had accknowledged the fact that the “civil service and private industry” that you believe are so valuable cannot be ORDERED into a war zone. Repeate after me “military service is unique as a field of employment, not a cultural prerogative”.

          1. I’ve worked both sides of the coin, and Jerry is right. When on active duty, I was ordered to Iraq on multiple tours, because that was what was expected of me as an Army officer. After I retired, I was OFFERED multiple jobs overseas, and turned them all down. It was my choice. Active duty is, in fact, unique. And the 20yr mark is a chimera. One thing not looked at in this study – beyond the numbers – is that the military doesn’t need that many men after 20 years. A. The body is broken, and can’t truly hang in a young man’s game, and B. The pyramid of the military has no need for thousands of people to stay past 20. If the argument is “we’ll get everyone to stay”, then someone needs to tell the Army, because right now, they’re forcing guys out who WANT to stay.

  5. First, most servicemembers leave *before* the twenty year mark. For many young adults the military is just their first job.

    Second: the services have *NO PROBLEM* separating a servicemember at any time. In the Army alone there are pages and pages of regulations to “Chapter” a soldier out of the service. From overweight and PT failures to poor job performance.

    Third: For those who do stay in, pensions and benefits are the huge draw to stay till the 20 year mark. Mess with that and a lot of mid-career NCO’s and Officers will /leave/ the service.

    Finally: This silly argument has been peddled for years. Keep in mind that a servicemember who has done 20 years in the military is behind his or her peers in the civilian world. Many have physical problems due to military service. Take away the 20 year pension and you not only break retention, but do a huge disservice to those who have stayed their 20 years.

    All these silly “reform” schemes assume that recruiting will continue as it has been. That the DoD can simply get the number of people in to fill slots. The military has to compete with the private sector with jobs and rules that are worse than anything out there. Break retirement and you break the military.

    1. Yes, many Soldiers leave before the twenty year mark – that is among the reasons that the current system is not equitable. The current system establishes that the Soldier leaving prior to twenty years is not worth providing pecuniary compensation toward retirement and the it gives the false impression that a Soldier who is not a colonel or sergeant major is not worth retaining past twenty years.

      I work at an Army TRADOC school as a service member. The numerous civilian and contractor positions here are largely filled by military retirees. Their continued service is valued. The majority of retirees are officers and they typically continue in military related service after retirement.

      I do not understand the argument of degradation to the health of a Soldier for justifying retirement at twenty years – that Soldier will receive tax free compensation from the veterans affairs office for his injuries. Currently, the VA benefits are in addition to his retirement benefits but preferred because they are tax free.

      No Soldier has a right to retirement at twenty years – just as no one has a right to any future potential benefit. It is the Soldier’s responsibility to see to his future stability and employability. As military leaders, it is our responsibility to worry about the health of the current force, first. We should have the foresight to to likewise develop better civilians.

  6. There is a pretty solid counter argument to this article. There are more senior officers and enlisted in the military than jobs available in the over 20, thus people stay in more than is being mentioned here . Secondly, there are far more jobs than middle managers in the military, thus, we are cutting where we don’t need to. Nevertheless, the whole pension attack is false anyway. The government uses more taxpayer money to pay interest than it does to pay military retiree pensions as an outlay. Cutting people and pensions just takes less political capital. Look at how redux turned out. Failed in less than 10 years of first group being vested.

    1. Also, let’s not forget that there are more DoD civilians than Uniformed Service members in the DoD. Why is all the retirement jibber jabber directed at those serving on the front lines??

      1. Leaving all of the other noise aside, DoD civilians are not part of this “jibber jabber” because they don’t get an automatic pension at 20 years.They have 401(k)s and other programs, you know, like civilians.

  7. Also lets not forget which service in the DoD has the most employees. If you chose a uniformed service your’retechnically wrong since there are more DoD civilians in the workforce than Soldiers Sailors Marines or Airman

  8. Seems to me that there are a couple of points that should also be factored in here.
    – In many states, public safety officials (police, fire, etc) can retire with 20 years service and have their pension based on their last year’s pay — including overtime. In CA, when I lived there, there were officers retiring at over 100% of their active pay. If we’re going to make military retirement more affordable, we should be looking at other “unaffordable” retirement schemes.
    – The military, unlike the private sector, cannot hire “managers” in at the ten or fifteen year point. The needed military skills simply aren’t there, so the “talent management” argument has a hole in it.

    BTW, the title of the article doesn’t seem to fit the content.

    Guy

    1. “The military, unlike the private sector, cannot hire ‘managers’ in at the ten or fifteen year point. The needed military skills simply aren’t there, so the ‘talent management’ argument has a hole in it.”

      It’s not a matter of “cannot”, it’s a matter of “does not”. Again, I would recommend Dr. Kane’s prior work for a cogent discussion of this matter. Elsewhere, he points out that there is no provision for an officer (or senior NCO) to leave the military for education or another career and then bring that experience and training back into the military. This also assumes that an old dog can’t learn new tricks, e.g. an experienced worker can’t train into a new job specialty; the fact that so many mid-level and senior workers in the American job market have cross-trained into the formerly niche market of IT support should serve as an effective counterpoint. And to take a purely military example, all aircraft carrier skippers (and possibly amphib skippers?) must be both a naval aviator and a surface warfare officer, so the Navy commonly sends experienced aviators back to train as SWOs, a training sequence which is most commonly administered to newly commissioned officers. The idea that you couldn’t take a promising candidate from the private sector and send them through the same pipeline mid-way through his career is merely a commitment to the status quo. The DoD’s retiree benefit system, and its personnel system, hearken back to the industrial age, when a great deal of training was accomplished through years-long apprenticeships and a worker could expect to work for the same employer, potentially at the same job, for his entire career. That’s not the world we live in anymore, and the idea that the existing system should be treated as sacrosanct is, once again, nothing more than commitment to the status quo.

      1. Aviators going through a carrier command tour are not qualified SWOs, they are commanders who get enough ship knowledge that they won’t break the carrier. They are never competing for ship jobs with career SWOs.

      2. Tom – acutally the services do have program that allows members to take upto 3 years ‘sabatical’, have their career essentially frozen in time, and return to the service where they left off. The reality is nearly no one chooses to use it.

        As far as ‘retraining’ goes, it’s not nearly as simple as you make it out to be. There are only 10 aircraft carriers (I just left one) in the U.S., and about as many amphibs that are commanded by aviators. The opportunity and real costs associated with training those 2 dozen or so officers every couple of years are trememndous; but we continue to do it because it makes sense operationally. However, to expand that to other career fields and jobs would eventually cost the services too much to remian viable. Just sending an aviator back for refresher training after a 3-4 year break in flying is costly enough. At least they do not have a break in service and are current on all their other required general military training (sexual assault prevention, information assurance, drug and alcohol awareness, anti-terrorism/force protection, PTSI awareness, suicide awareness, etc.).

        This is not a commitment to the status quo, it is a fiscal and readiness decision. How many doctors take a break in the middle of their career, and then jump back into a practice? The vast majority if servicemembers work on unique systems that do not have civilian counterparts.

        This system isn’t sacrosanct. But it is working. For the first time in human history, a democratic nation successfully fielded a highly-capable military that simultaneously fought two conflicts, half-way around the world, with an all-volunteer force. And it did so while taking the fewest casualties percapita of any conflict.

        We are only now entering an era where the large numbers of post-WWII retirees are passing away (sadly), and with them the military’s personnel accounts will begin to shift. In another 2-3 decades, the Korean War and Vietnam War generations will begin to pass on, further reducing the retirement bill that DoD pays. Then the retirees of the Reagn Era build up will follow. Meanwhile, the services are now at their smallest since before WWII. That means fewer retirees being added to the rolls in the aggregate, and ultimately a reduction retirement payouts. That’s the part of the equation no one is discussing.

        And, please do not refer me to another one of Mr. Kane’s articles. Pick another researcher. His insistence that “all the good officers” get out early implies that senior leaders in the military stayed in because they had no opportunities on the outside. Nothing could be further from the truth. Many senior officers end up retiring from the military and land high-paying jobs in industry sometimes at salaries above their supposedly ‘superior’ peers who left early.

        1. Justin: Thanks for this challenge as well. A few thoughts.

          You may be right about the sabbatical option. My own experience and observations, and anecdotes I’ve heard suggest that the handful of officers who actually exercise that option come back at a disadvantage, so I’m skeptical that their careers actually “thaw” after they’ve returned from being “frozen in time”.

          I didn’t intend to oversimplify the “retraining” issue; however, I think you’re side-stepping the point I was actually making. The argument that actual combat occupations, specifically infantry and SOF, would put incoming mid-level newbies at a suicidal disadvantage seems reasonable. However, I think that argument falls apart once you get to FOB-based occupations, and even moreso for most Navy and Air Force occupations. Having seen Army supply operations at work, there’s no doubt in my mind that your average mid-level FedEx manager with a few days of range time and a propensity for 10k races could literally and professionally run circles around most military supply officers. I’m going to assume that you’re joking about those PME evolutions. Civilians and contractors go through those on an annual basis, too, and they’re forced through them right alongside military folks before they deploy to CENTCOM through CRC, so the idea that being “current” is some sort of obstacle to initial or refresher training is spurious.

          You’re entitled to believe that the system is working. I’ve been concerned for a long time with the number of good candidates I’ve seen washed out of commissioning programs through no fault of their own, and the arbitrary or outright irrelevant metrics that see good officers cashiered out while adequate and incompetent officers are promoted. Such things will happen in any system, but I’ve been especially concerned with the frequency I’ve witnessed – hence my affinity for Dr. Kane’s work, as he’s documenting what I’m seeing with my own eyes. I also think you’d be hard-pressed to find many people who think that the military performed well in those two conflicts, even when one accounts for mistakes from civilian policy-makers. While I respect that you’ve been willing to engage with me and provide some thought-provoking counterpoints, I still think you’re defending the status quo. I would rather America get some smart people (maybe some of them from an outside perspective?) to come up with a new system, tailored to the specifics of military service, competitive with the civilian labor market, and optimized to improve the DoD’s chances of improving its performance so that America can get back to achieving strategic objectives the next time the decision is made to sacrifice blood and treasure to pursue them.

  11. As a 30 year Senior NCO Army Vet, I didn’t spend my waking hours concerned about how much my retirement would be. Also the argument of retraining middle managers and hiring-in managers is wrong. Any combat veteran knows you can only train combat instinct’s by being there. That’s why we have middle & Senior NCO’s who work everyday with junior officers. Where is that in your equation and charts?Let’s see IBM are any corporation hire in someone who knows exatly what to look for when clearing a bomb infested urban area. Can you put in their contract they are responsible for taking a bullet or jumpin on a grenade are leaving their family every 9-months to go get shot at? Maybe a change in the retirement system is needed. It is possible to grandfather at a certain entry year and then work out an equitable plan that is good for the soldier and the government. This article provided none of that. So until these educator, think-tank, analyst who write these reports join the CEO’s of IBM, Apple, ATT, GM, and “professors” of business analytics; are willing to go live in the hills and deserts of the middle east, the cold winters of Korea, and stand guard in a village besiged by warlords when you don’t know who will shoot at you next. Then I will promise not to try and run your companies are profess to be an expert educator (even though most military members are). Find a reasonable solution to the current retirement system at DOD. But, DON’T Compare me and my fellow service members to your middle management cohorts and kings of Industry until you have walked a mile in our shoes! I can make statistics and analytics say whatever I need them to say.

    1. Amen.

      Or spend 7.5 months at sea away from their families, with no guaranteed end-date to the deployment. Only to return home for what is supposed to be a year, which turns out to be only 6 months, beofre deploying again for 8.5 months.

  12. All the arguments on military retirement seem to center on what the members were promised, how it’s too lucrative compared to civilian retirement or whether DOD can afford it. The discussion never seems to hit the central point; what the retirement system must be to retain the career talent needed to run an all-volunteer military.

    Everyone seems to forget that the US military is a market driven machine; people decide to join, to stay beyond their initial commitment and eventually to stay long enough to retire. The Redux retirement didn’t seem like a big deal when it was enacted and for several years it had little impact on retention because those impacted hadn’t reached a point in their careers when they were making the decision to try and stay for retirement. Around 8-10 years after Redux took effect retention rates took a significant drop; apparently Redux wasn’t enough of an enticement to members to stay and retire so like any market driven group they voted with their feet.

    The number one factor in deciding any changes in military retirement should be the retention of a quality force in the correct numbers to run the all-volunteer military. If we ignore the market forces behind the decision we could have Redux all over again, or something even worse if an unmanageable number of mid-grade NCOs and officers decide the retirement isn’t enough of a benefit for them to stick around and make it a career.

  13. A couple of points. There are ways for the military to gain additional skills. A large percent of regular officers attend graduate schools , sent and paid by the Armed Services. Ther are also some internships in industry (not many).
    One reason that so many officers leave at twenty years is because that is when the pyramid starts to narrow significantly. They get out because they know that they would soon have to get out. That will not change with a new pension plan.
    The military is VERY different from a civilian occupation. I spent twenty ywo years as an officer (retired as an O-6) and 17 years as a VP of Human resources. The corporate values are very different than the military ones, for good reasons.The military, as a great sociologist once said is ‘modern man’s monastery”.
    The twenty year retirement ,as has been said already, rewards the soldier, particularly the combat arms soldier, who has spent a career in combat units and whose skills are not particularly transferable,with a pension that allows him to maintain his standeard of living because during his four tours in Afghanistan or Iraq, he didn’t have the opportunity to learn other skills.

  14. Here’s the cost of an all-volunteer force: In any given year, 2 Million people serve and 17% can expect to get to retirement ~ 340,000 retire. This is 0.001 of the American Public.

    The average pension is just short of $29k so round up. Ave yearly cost is $9.86B. US Budget this year is $3.9T so the retirement costs we pay the 0.001 of our population to defend us, so we don’t have to, is 0.0025 of our budget–this is not breaking the bank in any meaningful way–it is a Red Herring.

    The real question is–Is it worth it to us as a country to spend 1/4 of 1 percent of our total budget to be defended and free up the rest of our citizens to pursue anything they would like (freedom)?

  15. The mobility of a 401(k) retirement plan works in the civilian market where companies grow and shrink and have similiar skill sets/demands. A highly mobile military retirement benefit will prompt a one-way exodus. Many military skills are highly specialized with no civilian equivalent (carrier operations, nuclear missle defense, submarine hunting, military tactics, armor, field artillery, for example). The skills are also constantly changing to leverage technology and tactics. Once the skill sets are gone, you have to regrow them from within which takes years.

  16. Changing just the retirement system, without changing the underlying 1940’s era personnel system is akin to attempting to fly an airplane using only control.

    I recognize that the ballance between active service and retired pay is out of synch as lifespans have become longer (average life expectancy was 67.5 when the 20/30 year Up or Out system was created in 1946, it is over 80 today) and people are serving closer to 20 years than 30. But, unless you attack both the retirement and the larger personnel system its a fools errand.

  17. One issue that I seldom see considered is the fact that military service is a lot like professional sports; it takes a lot out of the body and spirit over a short time. There is a reason professional athletes are considered old in their mid-thirties and the same can be said for many military members.

    Many of the folks who retire from the military have significant disabilities and are no longer a full up round. For example, I retired from military service in my early 40s with a permanent limp (damage to the tendons, joints, and bones in my left ankle and foot); significant hearing loss; lung and breathing problems (including a persistent productive cough and liquid in my lungs); and arthritis. My medical profile was such that I could no longer deploy but I was fortunate that I was retirement eligible. Searching for a job is not particularly fruitful while you are coughing up your lungs.

    I am fortunate that my area of expertise primarily focuses on my ability to think and write. Those military retirees who are dependent on their physical prowess for employment face an uphill battle when their bodies recognize the years of abuse from military service.

    The reason that firefighters, police, military have a 20 year pension is because there is a limit to how long you can tax your mind and body at those levels. Any system that does not account for that is doomed to fail; and probably place the price of that failure squarely on the shoulders of the disabled veteran.

    1. DAMVET, what was your military retirement percentage and what was your VA disability percentage?

      You say you are still employable, despite your disability and its corresponding income, which is great. Would you seek greater employment if you were not receiving the retirement benefit and disability benefit?

      Just curious what the impact of those benefits is on your productivity.

  18. Has anyone thought about making retirement at 25 or 30 years?? Stretch out promotion timelines to make it fit.
    I was essentially forced to retire when I wanted to stay longer. When you dont get promoted to Colonel, you are sometimes treated as a second class citizen. Sommetimes the chain of command will forget about you, not be invested in you, wont write decent evals…. because you are now “done” and not promotable.
    If it wasnt for my retirement I wouldn’t be able to give back to my community as a full time volunteer. And since I missed so many of my children’s events over the years, i can now be a bigger part of their lives because i have a pension And am not forced to continue with a 50-60 hr work week….at least for now.

  19. So much that mere numbers do not take into account. I like to use myself as an example. I don’t remember my 30’s. They are gone, and I cannot get them back. My 30’s were spent in the desert. I had never really thought about it until I watched the sitcom “How I met your Mother,” a show about 30’s somethings moving past their 20’s. I had never watched the show much while it was on first run because I was deployed. Fortunately Netflix fixes that problem. Anyways it struck me while watching this show that I will never experience many of the things your average American 30 something experiences because I was busy fighting what is now a pointless war that everybody gave up on in the end. This is a simple way to look at it, but I hope you get my point. You can’t put a price on lost time. Seriously, if you believe a 401K is going to overcome that, then you are naive as hell. There has to be something real at the end of the tunnel. Flag waiving and patriotism only go so far, especially while the rest of the country is not sharing in the pain or suffering in any way shape or form like they did in WWII. Most folks didn’t even notice we were fighting a war unless they turned on the news. So bottom line is, what is in it for me to stay even to 20, let alone 30? A good pension is real, but quite frankly looking back, I think I would like to have my 30’s back. Disclosure: I did 22 years prior to retirement.

  20. So we worry about the 17% that do 20+ years to get 50% of the base pay, what about the people that are supposed to be serving this country that spend only 4 years in office and get a lot more benefits. And are paid more to serve themselves.

  21. First of all, we need to quit retiring general officers at such exorbitant pay! Four Star Generals making $277K in retirement pay? BS! This all was done by Rumsfeld. As an E7 Retired I make just shy of $28K per year in retirement. I was retired because my body was breaking down after spending all my adult life in the military. Yet, an 0-10 who makes $237K on active duty is entitled to $277K in retirement?

    1. Guys, you should think a little more about veterans like Chris Kyle who serve for ten years and get NOTHING in retirement. Kyle served from 1999-2009. Don’t talk about sacrifice in defense of the status quo when 87% of enlistees who sacrificed plenty get zero retirement pay. The USA can do better.

      1. Excellent, Mr. Kane! The USA can do better. Keep the current retirement system in place, but graduate it backwards also, so that each and every veteran gets some sort of “retirement” or “pension” no matter how long they wear the uniform. Now that WILL be expensive, but we have the resources to do anything we decide is worth doing.

      2. 80% of attrition comes within the first 8 years of service, and I would argue that the vast majority of those individuals (both officer and enlisted) are getting far from nothing. Yes, they don’t have a 401K contribution that can travel with them, but they have a huge GI Bill benefits package that they can use or that they can pass on to their spouse of children.

    2. Mark, FYI, I liked your comment! Really good point. I will try to make a clear case about enlistees (like my dad) in the forthcoming paper. Best regards!

    3. Great point we have far too much fat at the top and I say this as an officer. One thing that needs to be addressed is the compensation for those who do not stay for twenty. Good men and women bleed for this country and receive nothing because they do not stay for twenty. This is a huge equity issue. The idea that retirement cost too much is silly. What about all these corrupt CEOS, politicians, bankers…etc who make vast sums without ever putting their life on the line? Here is an idea increase the top marginal tax rate. Those who take so much from this country should pay more so those of us that make it possible can get our fair share. The 20 year retirement is a modest compensation for most.

  22. Anyone writing about the 20 year retirement, who has never suffered the hardships involved with those years in uniform, are also the ones who think that a service academy education is “free.” Arlington is lined with those who may have had their eye on retiring from service to their country sometime in their future (maybe even, God forbid, at the 20 year milestone), and that future never arrived. So you can take your Stanford education, your facts, and your well-documented argument and sell it to ISIS. Sometimes you just have to do things for the right reason, no matter how hard it is. If it’s unaffordable – figure out how to afford it. I’m so sick of this country talking about how expensive the military is. I’d like us to consider how expensive life would be without the military. We are the USA for crying out loud, so let’s stop all this academic whining and get to work to pay our debts and fund our military and its retirees. We have the resources, so let’s stop stepping over dollars to pick up dimes. God bless our troops. God bless the USA.

  23. Wow, I’m too expensive for Kane; in my next life, when I join the military & deploy again, I’ll do better & ensure I take a bullet or IED & save the government some money…

  24. Many great points have been made on both sides of this debate, which is what it should be…a debate. Anyone who has studied the history of our armed forces appreciates that timely adaptation and change is critical to sustained success, on the battlefield as a fighting unit and as an institution.

    In my experience, the military absolutely has a talent management problem insofar as skills/capabilities/talents are crudely misaligned with service requirements, making for a highly inefficient and wasteful system. On the whole, however, the armed forces manages to maintain a highly effective fighting force–much more effective than any other force in the world at present. But right now will not be forever, perhaps not in any case, but definitely not if the armed forces can’t adapt to new battlespace realities, emergent challenges and challengers, and find increasingly better ways of doing business. If we don’t seek these better ways out, painful though it may be, our competitors will.

    Although I’m unsettled as to whether the ayes or the nays have the right idea about maintaining the status quo pension system for the armed forces, I will offer one as-of-yet unmentioned consideration. Given the high degree of mobility of the military family, the high degree of dependence on the family support unit, and the general lack of transferability of many credentials (from professional to trades) between states and countries, the military spouse is often consequentially a low- or no-wage earner. The loss of a second income for the duration of a twenty-year career is worth plenty when one considers compounding interest, but also the spouse’s frequent inability to accrue serious experience over twenty years makes for a challenging entry into the work force as a mature adult. There are exceptions, of course, but for many within the armed forces, spouses don’t contribute financially during the military career, and may not be in a position to contribute much after either. In this way, the retirement benefit is perhaps best considered as compensation for both member and spouse.

  25. I’m not quite getting figure 3 and the value of work collapsing after 20 year point. At 20 years many Lt Cols (the majority of each year group I think) are passed over for O-6 and face mandatory retirement. Could this have something to do with it?
    Secondly, figures 1 and 2 talk about continuation rates after 20 years. Maybe I missed what the definition of continuation rates mean for those figures but I always thought “continuation” was for O-3s and O-4s passed over for promotion but allowed to remain in service untl their 20 year point. Not for Lt Cols passed over for promotion after after 20 years TAFCS.

  26. The way I view it is that there are two needs here on the institutional and personal level. The military as an institution needs to change its retirement scheme to avoid becoming like the city of Chicago, with a huge tail of pensions, and military retirees, regardless of age, need to both get a good compensation package and not be forced to wait 20 years for it.

    I see a lot of guys here talking about how essential retirement benefits are. I agree. So how about a scheme where soldiers’ base pay is increased, everybody gets a generous no-strings-attached defined contribution retirement plan like a private sector 401(k), with additional matching for private contributions – a retirement plan that vests immediately rather than at 20 years? Hypothetically, if this type of scheme gave you, the retiring veteran, the same benefits if you retired after 20 years of service, would you prefer it? I’d say yes, because it would also allow me to retire at 19 if need be.

  27. I am a service member and have been following this debate for about 10 years now. I started doing research on a proposal back in 2005, ultimately publishing an article in 2010 on revamping the military retirement. A quick overview is below: http://www.world-economics-journal.com/ArticleDetails.details?AID=448

    Overall, I have concern that the military itself was has not been overly concerned about coming up with an alternate plan, but instead continues to rely on outsiders to make recommendations. This is unfortunate the reason why I wrote an article. Most service members acknowledge that the system needs to change, but worry about the potential negative effects long term with respect to talent management. On thing I think Dr. Kane has negated to thoroughly explain (at least in this thumbnail explanation) is how his plan would entice someone who has a high “opportunity cost” (i.e., the “good ones” the military would like to retain long term) from leaving prior to 20 years. Unless there is a strong “hook” (20-year vesting that is significant), most of the good ones will be long gone. And, I don’t think it is possible to “move flexibly in and out of active duty roles” in the military- once you are out, it’s almost impossible to come back in and operate at the same level as having never left before.
    Overall, though, I am certain that some of his proposals are worthy of consideration, because he has at least correctly identified the major incentive problems associated with the current plan.

  28. I am a military spouse, and I’ve had to sacrifice MY career and MY retirement to support my husband’s 18-year service (he is Lietenant Commander now). I have huge gaps in my resume because of the frequent relocations. Each time I start a new job I’ve had to wait a year or longer before I’m considered “vested”. Until then, employers won’t do any matching for my 401k contributions. After each move, by the time we find a place to live and I find a new job, we are often 5 months into our 3 year tour. Add a year of vesting from my hire date, and I’m looking at a yea and 7 months of employer cobtribution matches before I’m forced to leave my job and move again. My husband has endured lengthy deployments, cannot refuse any vaccines, even experimental ones, and (as is the case with all officers) can be released at any time for no reason at all other than budget cuts. We’ve moved 11 times, never once to a place on our list, and he is not entitled to overtime pay, and he was exposed to dangerous chemicals when deployed to the Gulf Oil Spill, and his pay raises get frozen every single time congress can’t balance the budget. I could go on and on and on. But still he chooses to serve. And now he has to deal with the uncertainty of losing benefits that were listed in the contract he signed, a contact HE is not allowed to break but apparently the government can. Civilians who’ve never served write articles like this and destroy lives. Where is the outcry about spending BILLIONS on weapons systems and contractors? Cutting there would surely fix the budget. Instead civilians who’ve never served seek to take contractually promised benefits from people who voluntarily serve. You should be ASHAMED of yourself!!!!!

    1. Ma’am, with all due respect, no one is suggesting that these proposed reforms should be retroactive. No one is proposing that the nation alter the conditions of your husband’s retirement. The idea is that the system be reformed for personnel who have yet to join the military so that in thirty or forty years, they might get a better shake than you and your husband have.

  29. Thank you for your contribution to this discussion, and I look forward to reading your article. It’s refreshing to see someone with skin in the game who’s willing to acknowledge that, while reform would be uncomfortable, there’s ample room to improve the current system, and that America should try to find a way to do better by the next generation of corporals and lieutenants than it has by the current generation. That it would involve some institutional discomfort, and deviate from the Army/Navy/Marine Corps/Air Force way that so many have grown accustomed to, does not mean that we should treat the current paradigm as sacrosanct. It would be nice if more commentators would acknowledge that nobody, least of all Dr. Kane, is proposing that America renege on promises made to veterans in good faith, but I suppose that the merest whisper of “reform” leads many to fear as much – probably not without reason, though I personally think that the alarmism is unrealistic. (I also think that many commentators both here and elsewhere read the headline, rather than Dr. Kane’s article itself.)

    One caveat: I question your statement that “once you are out, it’s almost impossible to come back in and operate at the same level as having never left before”. The gold standard of this is probably Will Swenson, the Medal of Honor winner who left the Army in 2011 and rejoined last year. I’ve known others who have done the same. Members of the Reserve Component essentially do the same thing on a regular basis, and have carried much of the weight in Afghanistan and Iraq. I’m not sure about Dr. Kane, but I would suggest that some of the hurdles to being able to leave and come back pertain to the way the military chooses to operate, rather than inflexible, fundamental factors endemic to the professin of arms. The status quo got that way for a reason, but that’s no reason not to question, on more than the anecdotal level I’ve seen here, whether or not another system would allow service members more career flexibility (and satisfaction) while producing a more effective fighting force. Discovering that the answer is “no” is one thing, but maintaining the status quo because it’s all anyone has ever known is quite another.

  30. I agree that there could/should be tweaks to the military retirement pay system. But the observations that the promotion/evaluation system needs to be changed are also correct. Too many hard working, top notch officers are not getting promoted due to antiquated and ever changing promotion rules. Having a masters degree is important, then it’s not. Fitness isn’t important, then it is. I can’t tell you how many flightsuit popping Lt Cols I saw walking around my base. When the promotion system relies more on the writing/wordsmithing capabilities of the evaluating officers rather than the actual performance of the officer, something is broken. Who wouldn’t punch out immediately after 20 when there is no hope for advancement if you aren’t promoted “in the zone”? The bottom line is, things need to and should be changed in both the promotion system and retirement pay program. But those who served honorably for 20+ years under the promise of retirement pay and benefits should be given those benefits. Any changes should not be retroactive.

  31. This article was good until the end. Here’s why the author lost credibility with me:

    1. It would be great to be able to leave and rejoin as suggested in the 3rd to last paragraph, but how many people would do that? We allow that now, but it’s a pretty slim margin or returnees once out. So now you’re stuck if you lose a person at 10 years, how do you find someone with equal experience on the outside to refill that vacancy? You cant just go out and hire an O-4 or an E-7/8/9.

    2. I’m fine with modifying the pension plan, but anytime people compare military with civilian pensions it rubs me the wrong way. Clearly the people making those comparisons have never served. If they had, they would realize that the reason only 19% stomach it out to get the retirement is because every nickel of that pension is jammed up their butt for 20 years. How many civilians would work the hours and miss important life events and milestones without a dime of extra compensation? How many civilians would voluntarily give up their rights to be subject to a more restrictive legal code called the UCMJ? How many civilians would in their most downtrodden days of their job give up their ability to just quit anytime they want? I don’t think many IBM-ers would find those working conditions too palatable even with the pension.

  32. I retired after 20 in the USMC. Easy fix here…..raise retirement to 22-25 years vice 20. Make it a requirement to be an E-7 to retire. It will not solve the problem, but it will help.

  33. I will also agree that the culture in the USMC changed dramatically. It is very hard to do 20 years in today’s Marine Corps. The days of ” sweeping issues away” are about gone. I speak only on behalf of the USMC.

  35. About the paragraph that starts “The status quo likes the status quo.”

    Without other types of reforms (promotion policies, and separation and accession policies) then there will be no flexibility in talent management regardless of changes made in the retirement system. You may make the retirement system more fair for those leaving earlier, but you may not be able to replace those leaving with equally capable new joins.

    The way the entire system is built, as a midlevel and above officer or NCO, once you leave active duty the options are either the reserves or nothing.

    Due to age limitations and the requirement to resign a commission, for instance, there is no incentive for me to leave the military to pursue career broadening experiences.

    As a 41 years old O4, for instance, I can’t get out without giving up my 11 year career: I wouldn’t be allowed to come back, and all I would end up with is my TSP. Even when I joined at 30 years of age, I needed an age waiver. But for my law degree, I simply would not have been able to get in.

    Even if I left, a 35 years old promising mid-level manager in the civilian world couldn’t join the military to replace me; age restrictions prevent that. How can you recruit mid-level talent in this kind of system?

    Our military system (not just the pension system) is designed to breed the mid- and high-level managers from the ground up. Doctors aside, if memory serves, no one joins the officer ranks as anything but an O1; lawyers, for instance, can get a more or less accelerated promotion paths to O3, depending on the service.

    So no, the overall system is not built for “leaving and then rejoining” even if you changed the retirement system.

    It’s built to attrite officers through the years with the “up or out” system, and provide officers and NCOs a clear incentive to stay the full 20 years. Whether those that stay are the best and most experienced is arguable (hence the need to reconsider the promotion system as well).

    If you wanted more flexibility, then the statutory age limits would also have to be revisited.

    If you wanted to retain people past the 20 year mark, you would have to consider the financial disincentive to do so. The “working for half pay” mentality could be eliminated by not allowing retirement benefits to be paid until age 55 or 60, for instance.

    But then you would have to ask yourself, with a force size mandated by Congress, would you even want to retain all these mid-level and senior managers? You need them to get out to give the rest of the force the chance to circulate up, lest you end up with a stagnant work force.

    Flawed as it may appear, the 20 years system in fact favors career progression in a system where, unlike the civilian system, you can’t just up and leave to work for a competitor if you feel you are not advancing as quickly as you should.

  36. “So the rank-and-file (usually men from rural America) grit their teeth, put up with the PC insanity that has infested the DoD and punch out at 20.”

    This is SO very true. The men in the military are captive guinea pigs for every social engineering experiment to come down the pike and we are well aware of it. Many of the women are too, though the younger females are the most dangerous because they actually take the propaganda at face value.

  37. After several years of a Bull market its easier to promote plans based on the performance of 401Ks (instead of a pension). Imagine the carnage to our forces when the next market crash hits and 401Ks are wiped out. The current military retirement is far from perfect, but it’s the best of a lot of bad options that I’ve seen.

    1. 401Ks are generally spread across industries which is very effective protection against a ‘crash’ – they may lose some value but won’t be “wiped out”. And a market crash only hurts you if you panic and bail out completely at the bottom of the crash. I started my IRA with USAA when I started my career in the 80’s. Yes, the crash of the dot-com bubble hurt my account on paper, until you looked deeper at the numbers. The market (DOW) went from around 10,000 to 8,000 if I recall, losing a whopping 20% from the peak. But since the DOW was close to 800 when I started my account so all the initial deposits were STILL UP 1,000% at the bottom of the ‘crash’. And since I left my money in play, it is back up well above what it was then, even after the 2008 ‘crash’. DOW is in the 18,000 range, over 2,000% increase from when I started. Average return on “investment” in Social Security for the current generation has been calculated in the 1% to 1.5% range, far less than even a volatile market will produce.

  38. “an asset that will be more highly valued by the veteran retiree” – based on what evidence? Did you survey Millennials to see what they would value more, or is this just another ASUUMPTION to ‘prove’ your point. The fact that the money pays immediately is more valuable to me than any matching funds that I wouldn’t be able to access for another 10-20 years after I retired. As many have stated, having funds available upon transition while you train/learn a new occupation or just take a knee to decompress is invaluable.

    As far as half the personnel that retire at 20 instead of later, the antiquated up or out system on the officer side lends itself to that, along with sanctuary. The 17% figure is a red herring – most of those getting out are doing so after one enlistment or the end of their obligation for academy/ROTC – perhaps finding the military life is not for them, or they’ve now ‘been there – done that’ and want to move on to other challenges. They get to take skills/work ethics and a record of being trainable which will serve them extremely well in their early to mid-twenties.

    I’m at the 19 year AFS mark and 29 years total service and ready to return to the civilian world (5 years AC, 10 years traditional National Guard and 14 years AGR). I would probably be back off active duty if I were not so close to the 20 AFS mark but I’d still be in uniform. I’m not wedded to the status quo. However, adjusting the retirement program simply to fit a temporary budget bogey is an insult to the Service Member. Any change should be based upon force shaping as all other incentives (enlistment/ reenlistment bonus, tuition assistance, GI Bill, etc.)

    And since the changes would not impact the current generation, how do you determine the most effective retirement system for a military and a society still 2 decades away? I like the idea of the TSP or 401K with a match, but dislike having “your money” locked away from you until an age you may not reach. TSP/401K that you can access upon discharge with no penalty, or roll into a tax-sheltered IRA or carry with you to a new employer. We should be beyond the one-size-fits-all mentality by now, even if we ARE talking about the federal government.

  39. As a Retired SSG/E-6 and looking back I did not apply myself as well as I should have to my career. That was my fault. Shame on me! However, being retired military the civilian would is also prejudice toward organized trained and dedicated soldiers. I justify this statement based on my civilian career. The VA Counselor asked me at my retirement interview what would I like as career being a civilian and of course they explained my military job would transfer to my civilian career. Well it is not that simple. She offered my a college degree program because civilian personnel managers must have so many years of experience, you have the experience but not in a civilian type business and you need more education. At 42years old I started college; I only finished high school. I carried a 3.5 GPA for 3 years and became an honor student. I graduated and did not go into personnel management; I got my degree in Occupational Health & Safety and still becoming a Safety Engineer for construction and general industry. Dedicated to preventing employee injuries or death and believe me the military was the best teaching experience for that. The military needs to teach soft negotiation skills. I retired 20 years 1994 and would have stayed 30 years if I could have. I was dedicated to leading and teaching soldiers to be better than me. The military needs to tress college degrees and they must be current the past is to late. I went to college at night in the military but those credits did not transfer because they were to old. As a civilian I have learned I am past my prime the civilian world does not care about your past career, they only care about your adaptability and can you catch up to the current job market. So retirement should be a 20 year career and the military current preparation programs need to be up to date with current job market. Let soldiers go to college and get a degree in the military and coach them into a civilian career they can prepare for. the current program is just a shallow attempt to convince the government their is program similar to the current VA system. Everyone is more worried about money than about the soldiers becoming civilians especially when colleges are graduating students yearly. As retired soldiers between the age of 38 to 48 the college kids will take your jobs faster. So retirement pay and the G.I bill will sustain your employment income hopefully. Remember, Soldiers that retire 20years may not just be officers. If I had known the civilian world was not very military appreciated I would have left the military after 4 years and went to college. Not much since in 20 or 30 years unless your ready to be totally retired because your body may be worn out as-well.

  40. I hope who ever reads my story will please forgive my spelling and punctuation errors. Please also learn your retirement income or using up the savings account is the only thing a soldier has to support himself, and god forbid if they have a family too. Please government fix this and teach soldiers to make themselves smart now because waiting at the end of your career is to late.

    I am 63 years old still going to college,exercise daily and not ready for the retirement home yet! I have another goal which is to get my masters degree.

  41. I find the retirement system that is being kicked around interesting. I am 4 years from 20 and plan on staying until I hit 22-24 years depending if I make e8 around my 20 year mark.

    It seems that all of the focus in these matters goes towards officers. Why are our officers leaving is the overall question when i feel it should be why do people drop at 20. Personally my officers suck. These last few years I have come to appreciate my old NCOs who hate officers because while we as enlisted work our way perfecting our craft we have a college guy come in and suddenly he is in charge and clueless. WW2 officers were drafted from enlisted ranks these days you go to college and you become and officer. For instance. I am an s4 ncoic have a batchelors degree in logistics and have 16 years experience. My office is a revolving door for officers as they come in get property experience and go on to become company commanders. But they have degrees in liberal arts, general education, political science…… Seriously and they put those people in charge of an office where they get carried by people like me….. So my point is if you want to keep experienced people in than there needs to be a better incentive to keep on that talent. We drop at 20 because we can find better jobs, for the most part, where we are appreciated for our knowledge and away from the constant line of officers who really suck at their jobs and get moved around so much it can’t be decided if they are any good or not.

    Our officers suck and if we want to figure out what to change about the retirement system than we should start looking at fixing the culture in our ranks and the rest will start to take care of itself

    1. Whaaaaaat? An officer can suck at his job? Lmao noooooo fn way. An education could possibly replace experience? Claymores anyone? Love that movie “Aliens”. Best line was “why don’t you put her in charge”. So the premise is an educated man sayyyyyyy a 1st Lt. could lead his men in battle with a liberal arts degree over an experienced NCO with many years of experience? Okay in the context of this discussion please tell me how that relates to common sense? Please tell me because all arguments or discussions must begin with that. It’s not stats or spreadsheets but lives. Explain it.

  42. Best idea? Anybody that has done 20 years and retired be the ONLY ones with input. Regardless of rank or job. Love to see that discussion. However, I already know the discussion. That discussion is mute because it’s one sided. Unless you did twenty then your right it is muted!

  43. This articles graphs seem to point to everyone retiring after 20 years. I think what the story fails to tell is a lot of these people do not choose when they retire. There is no mention here of high year tenure. Their graph needs to include rank. Most TSgts retire at 20 because they are forced out. The way I see it those same TSgts deserve that pension. What other profession asks 20 years from you then kicks you to the curb in your 40s. It’s not like these people can stay in the military until full retirement age. No I think a pension is appropriate when you ask someone to commit 20 years and then change careers midlife when you know they will take a huge pay cut. Another thing, most people enjoy being able to start that 30 year mortgage early in life. Not the service member who has to move around there whole life then finally in their 40s actually have a chance to stay in one place for more then a few years. I think service members sacrifice enough and deserve their pension.

  44. What a joke. This is a cost saving measure pure and simple. It would save the government money on the back of veterans. A 401K type retirement can never be competitive with the current system because people don’t save, so the employer doesn’t have to contribute. Military retirement is better than the private sector for a reason, because the job is more dangerous. Executives are not at risk of being blown up by IED’s, or asked to leave their families for up to a year at a time every couple of years to go off to a war zone. You are sick, and should be ashamed. And any service member who wants a plan like this is dangerously misinformed. Any “plan” in regard to retirement that saves the government money is inherently suspect. I write this comment as a military officer, and a person who has attended law school and undergraduate universities. You are not fooling me.

  45. This is for Tom for me you come across like you have all the answers for military retirement. You talk a lot about your unique vantage point and I’am a little curious ,just what is your unique vantage point?after all everyone has one.

  46. The 20 year retirement is the major reason men and women are willing to rise their lives for the betterment of their families. They miss their children growing up and some lose their marriages for their service. No regular job is life threatening and so physically demanded then the military. That’s why you need an incentive to keep the experienced soldiers for 20 plus years.

  47. I do not see the Senate and congress wanted to stop their pay after only service 4 years in their position. When i was in the military in the late 80s. They gave the military a 1.5% raise by gave themselves a 50%raise. If they really wanted to save money why did they do that. It is fine as long as it is not them.

  48. Your article speaks only to officer retirement, where you point out the salaries & benefits which are significantly higher than enlisted personnel, who are under the same “plan”. While addressing the 20 year exodus of officer personnel, a parallel occurs within the enlisted structure, and what you haven’t addressed is the pyramid structure of both officer and enlisted billets. Many officers and enlisted leave at 20 simply because they are unable to move up due to stagnation above them. Those who have moved above the O-5 level, or the E-7 or E-8 level and have the opportunity to serve 30 years stay and essentially eliminate any upward movement from below. If one is continuously passed over for promotion because there are no billets, they are required to retire, or they simply retire at 20 years knowing there’s little hope of advancing further. Technology has resulted in the elimination of billets, both officer and enlisted, resulting in fewer opportunities for advancement. No matter the format, if the billets aren’t available, personnel in their prime mid-life years will walk. Cost of living increases, until President Reagan’s term were given to retirees twice a year. Since then they have been just once a year, and even that has been “messed with” for convenience of the government. The fact that military retirees are living longer today than they did in the past, and in many cases drawing retirement for 30 or 40 years instead of 10 or 20 has a major impact on the budget, but their service shouldn’t be compared to a white collar or blue collar civilian occupation, whose retirement is based on a strict 40 hour work week with greater incentives to stay for 30-40 years before getting a retirement check when they are subject to call 24/7/365, and then have to pay state and federal income taxes on their military retirement, or are faced with employers who offer lesser salaries because “you’re getting a military retirement check”.

  49. I just came across this article, which pisses me off. Americans and our politicians love to wave the flag yet few answer the call to stand up for America. They are willing to spend more on defense than the next 10 countries combined then they don’t want to pay those who served and fought their wars, scum. Just who are these retirees that you want to change their pension system that you promised. Military retirees make up less than .05 % of the population. Yes, .05% = 1/20 of one-percent.

    Approximately, three-quarters of one-percent of the U.S. population currently serves in the military. This includes active duty, Guard and Reserve forces.

  50. I am one of the 17% who has 20 years as a Soldier and now I am retiring. I find reading this story and all the comments with mixed emotions. I loved the military and the life I had in the service, at least for the first 15 years. I can honestly say after that the injuries, moves, deployments, and politics after that made me prey to make it to 20 years. The military life is difficult and takes a toll on people, physically and mentally and I see why it is such a low number (17%) who make it. I couldn’t say the system should or should not be changed but I know after feeling I had to stay the last 5 years to get anything from my dedication the first 15 I am not sure the government would have a all volunteer force if they don’t make the service we do worth the injuries and hard lifestyle as well as the freedom we give up for those years we do! The retirement we receive does not make anyone a rich person; and most retires I know still have to work to pay the bills. The fact we keep loosing benefit (like medical TRICARE for life is just Medicare we have to pay for when we get old and need it the most) is heartbreaking when Soldiers do give so much. I will always love my service and the military and appreciate those who served. Thanks to them we have the ability to have freedoms in my retirement and regain those I willing gave up for 20 years.