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. 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 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. It is coercive. In , a few years after the All Volunteer Force was enacted into law, the U.
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 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 , the Defense Business Board issued a report that offered the latest harsh critique and proposed replacing the defined benefit entirely with a savings plan. It may be the first major commission in half a century to recommend leaving the defined benefit pension in place. This reform will save Pentagon some money, but will not change behavior.
There is a distinct retirement bubble at the 20 th year. 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.
The third figure is mine, and one look explains the year bubble. Then you will be able to mark statistics as favourites and use personal statistics alerts. Please log in to access our additional functions. Yes, let me download! Exclusive Corporate feature. Corporate Account. Statista Accounts: Access All Statistics. Basic Account. You only have access to basic statistics. Single Account. The ideal entry-level account for individual users. Corporate solution including all features.
The most important statistics. Further related statistics. Average benefit forecast of military retirees U. Armed Forces personnel from U. Military ready reserve personnel numbers, by reserve component Education levels of active duty U. Armed Force officers in Marital status of active duty U. Armed Forces separations in , by service branch Geographic stationing of active duty U.
Further Content: You might find this interesting as well. Statistics Average benefit forecast of military retirees U. See how to apply for a survivors pension. You can only get one of them. Each has its own qualifications.
Some people confuse military retirement benefits with a VA pension. Here are two ways to tell the difference:. Military retirement uses years of service not necessarily wartime. But a VA pension is based on wartime service and financial need. In some cases, veterans can receive disability compensation.
It's not the same as the VA pension. Disability compensation is for an illness or injury that happens because of or was made worse by your military service. A VA pension is for war veterans with a low income and who may have a disability that is not service-related. Ask a real person any government-related question for free. They'll get you the answer or let you know where to find it. Share This Page:.
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