Military retirement changes are happening for many of our nation’s service members in the form of a new, blended retirement system. Anyone who joined the military after January 1, 2018 was automatically enrolled in the Blended Retirement System (BRS), so it’s important to understand exactly what it is and how it might impact you.
Why Did Military Retirement Benefits Change?
According to the DoD, only about 19 percent of active duty members and 14 percent of reserve members actually hit the 20-year service mark previously required to receive retirement benefits from the military – about 1/6 of our military population.
To alleviate this problem, the Department of Defense rolled out the Blended Retirement System to serve the remaining 80 percent of service members left without military retirement benefits. The goal of the BRS is to offer a retirement system that aligns more closely with a civilian 401(k) plan, as well as to offer military benefits for those who serve their country in uniform, but not for a full 20-year career. While these new military retirement changes are designed to save the government money, many benefits are available for military members who understand the new system. It’s perfect for veterans who want to build their savings for retirement, those who may be seeking to open a small business, or those who want to become a certified, veteran-owned, small business government contractor.