tomleeinar wrote:Overall I don't like the new plan either, but do remember that under the current military retirement plan, if you don't stay in for 20 years, you get nothing at all (let's keep all the irregular retirements out of it).
I get what you're saying; however, why do we need to change our entire retirement system from an All-or-Nothing system to a "corporate style" system so that we can entice the "give it to me now generation" to sign the line. I don't think we do. In normal fashion in a post-war environment, all branches are putting people on the street, and I haven't seen anyone saying they are having issues hitting recruitment goals. I don't think a 401K-type account is a "recruiting incentive."
Fact #1: Nearly 80% of high school seniors are ineligible for military service. That leaves a pool of 20-some percent of potential high school graduates. Of that 20% pool of eligible folks, I think I read less than 1% of of high school graduates actually join the military.
Fact #2: Less than 17% of new joins stay long enough to attain military retirement (20 years). Less than 1% of that 17% remain in long enough to hit the 30-year mark and a 75% retirement annuity.
Fact #3: The military "retirement plan" is clearly laid out and explained in any number of places. Folks know, or should know, what their retirement options are when they join. The "option" of a decent military retirement at an early age has always been one of the main perks of serving 20 years. When a "potential" is talking to recruiters, they are told, "20 years and you get "X" percentage forever...and by the way, it's up to you to get up the rank ladder...we're not going to do it for you." Since I joined in 1986, that retirement percentage has continued to shrink about every 10 years.
So - Just looking at the baseline numbers, why do we need to change the entire military retirement system, for what amounts to less than than 1% of the potential military pool?
Sure, you can say it's really only effecting the 17% of folks who stay in long enough to retire: however, I argue that you'll see fewer people staying in that long because of the severely deteriorated retirement benefits, and, in a matter of years you're going to see SERIOUS leadership and readiness issues throughout all five branches because so few people are staying in long enough to reach retirement. I see a serious future problem of "juniority" (folks who aren't ready for leadership and management positions who are promoted to fill billets). IF only we were all Navy Seals...we may escape the "leadership" issues.
Not to mention, what are MOST PEOPLE doing in their 20-30's: having kids, raising a family, buying homes etc. How many military folks in the lower and mid-rank pay grades who will be doing exactly that are going to be able to set aside enough money to see a 5% match? The Pentagon knows that!
Moving to a corporate-style 401K deal may seem like a good idea in a big-picture scheme; however; when you sit there and really pick it apart, it's nothing more than cost-cutting measure being passed off as a "perk" for the younger generations who don't know any better.
The Pentagon no doubt knows that most young people don't save money; they never have and probably never will. Saving money, planning past the end of one's nose, and setting up one's future remains a foreign concept until your madula oblongata evolves in your mid-twenties.
I had one new-join tell me, when I asked what his savings plan entailed, "Sir, I may not live to be 65 years old, and I don't make anything now. This is as much money as I've ever had in my life and I'm going to live a little." Dude came into work not two weeks later driving a brand new Volvo.
The Pentagon knows that the overwhelming majority of new-joins don't remain on active duty very long; never have and never will. As such, they are working the numbers to ensure they cut costs and come out ahead. Yeah, some folks may do four years and leave with a little coin in their account. Some may stay in long enough to reap the mid-career bonus. Very few will remain in long enough to build a decent account, receive the mid-career bonus AND reach retirement eligibility (albeit with a much smaller annuity). I'd be curious to see how many short-term enlistees leave the service and cash out their TSP (incurring all kinds of tax penalties), or how many stayed in long enough to get the mid-career bonus and then promptly blew it on a new car, a vacation etc.
In my opinion, the new retirement plan benefits the Pentagon by cutting personnel costs; it penalizes wanna-be retiree's, and caters to the youngest generations who have the "gotta have it right now" mentality. I may be "old school" in my thought processes as the result of already having 30 years of active duty behind me; however, I think the new retirement system it's nothing more than dirty-pool conducted by bean counters to save money.
Kinda like the Pentagon continuing to recommend, and sign off on, poor military pay raises year in and year out for the past 8 years. Kinda like the continued deterioration of retiree healthcare benefits. Kinda like the recent stoppage of transfer eligibility of Post 9/11 GI Bill benefits to dependents. Kinda like the current reduction of military tuition assistance....
If this crap keeps up, it won't be long until the there won't be any reason to join the military other than one's own patriotism and obligation to serve. I mean, that's why I joined
I'm sure that was Cro's motive as well.