The changing terrain: The New Military Retirement
Support for the military’s current retirement system is strengthening among America’s career service members, with four out of five families expressing a desire to stick with the traditional pension rather than opt in to the new blended retirement plan that goes into effect in 2018. Third quarter results of the First Command Financial Behaviors Index® reveal that 82 percent of middle-class military families (commissioned officers and senior NCOs in pay grades E-5 and above with household incomes of at least $50,000) say they want to be grandfathered into the current retirement system. That’s up nine points from the previous quarter and 14 points from the same time a year ago. Index data continues to reinforce the preference that career service member families feel for the lifetime financial security offered by the traditional military pension, viewing it as a powerful benefit.
Looking ahead, the majority of current service members who qualify to opt in to the new system expect to seek professional help making that decision. September survey results reveal that 87 percent are likely to consult a financial advisor. Sixty percent of service members who are already working with a financial advisor say they are extremely or very likely to ask their advisor for help with the opt-in decision (compared with only 20% of those that do not have a financial advisor).
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