A 401 (k)-style retirement plan, as well as an increased wage and additional benefits for troops and military retirees were backed by the White House and the Pentagon Monday.
According to the USA Today, the White House will report to Congress by April 30 on the changes — 15 recommendations released earlier this year by the Military Compensation and Retirement Modernization Commission — that can be “implemented quickly”.
Part of Defense Secretary Ashton Carter’s plan to both recruit and keep seasoned, skilled troops — extending benefits stands to play a key factor in this integral initiative.
Astoundingly, right now, a whopping 83% — including the majority of enlisted men and women who have done the fighting in Iraq and Afghanistan — do not qualify for retirement pay.
The current pension system pays out 50% of a military service member’s pay after 20 years of service — but that’s it. Without two decades of service, there’s nothing.
Another element of the plan would be to allow troops and retirees to choose commercial healthcare plans. Retirees would be asked to pay an increased share of their costs but less than the rates of government employees.
According to the Center for Strategic and Budgetary Assessments, the cost per person in the “active duty force” grew by 46% (excluding war funding and adjusting for inflation). The Pentagon is claiming that, at this rate, the personnel costs will consume the entire defense budget by 2039.