Sunday, December 22, 2013

Retirement/Disability Pay Cuts: Personal Costs to Soldiers, Sailors, Airmen & Marines

A veteran's etter to the Editors, the weekend Wall Street Journal, December 21, 2013
The new budget deal doesn't contain "a little" military-pension reform. It will have a devastating effect on the personal finances of active-duty and retiring service members. The proposed 1% annual reduction to uniformed service retired pay Cost of Living Adjustment will reduce their retired pay by 20% at age 62.
While portrayed as a minor change, a 20% reduction in retired pay and survivor-benefit values is a massive cut in military career benefits, a de facto tax and egregious breach of faith to those currently serving, retirees and their families. A sergeant first class or chief petty officer with 20 years service who retired in 2013 would realize an $82,982.20 penalty, 19.3% of his pension by age 62.
Furthermore, the proposal in the budget agreement actually eliminates the appropriate review process, failing to consider long-term readiness and retention outcomes.
Currently serving members look at how they, their families, retirees and survivors are being treated when making career decisions. If Congress arbitrarily cuts the retirement benefit for those who have served their country for over 20 years, there could be a lasting adverse impact on uniformed service career retention, and ultimately, national security.
Vice Adm. Norbert R. Ryan Jr. (USN, Ret.)
Military Officers Association of America

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