Equitable Distribution – Military Divorce beharris
Changes to Military Retirement Beginning January 1, 2018
In a bid to lure Millenials, the U.S. military is making the most sweeping changes to its retirement program since World War II. No longer will only 20-year veterans leave the service with a benefit for later life. Going forward, those who serve as little as two years will be assured of returning to civilian life with at least some retirement savings.
The new Blended Retirement System introduces matching contributions to a 401(k)-type savings plan while downsizing the traditional pension benefit – a trade the corporate world has been making for 35 years. About 88% of current active-duty military, or 1.15 million service members, will get to choose between the old and new designs.
Under the new plan, 85% of those serving in the future will leave the service with a retirement benefit, the military says. That compares with less than 19% under a system that has been in force since the days of MacArthur and Patton. The idea is to attract more men and women who aren’t inclined to make the military a longtime career.
The shift was effective January 1, 2018. Those who enroll after that date get the new plan, while those with more than 12 years of service will remain under the old system. Anyone with less than 12 years of service on that date will have one year to make an irrevocable choice between the two programs.
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