So poor decisions become better at some critical mass?
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NDAA FY2016 Changes to Military Retirement
- Thread starter Maxillarious
- Start date
Spekkio
He bowls overhand.
My math is not off; no one is making 7% compounded growth on their retirement plan over the entire duration of it. That's a ridiculous optimistic number that says your IRA is going to grow at the same rate as historic long term S&P gains.
exNavyOffRec
Well-Known Member
I wonder what will happen when it becomes difficult to retain people because they find it easier to leave with the money they have built up in their 401K, we all know what the USN does when it becomes difficult to retain people, they throw money at the problem, was that factored into their calculations?
How many sailors leave paycheck to paycheck? How many are going to be thinking that they could use the money that is being automatically deducted right now for living expenses?
How many sailors leave paycheck to paycheck? How many are going to be thinking that they could use the money that is being automatically deducted right now for living expenses?
No, but the folks who came up with it tried to gear it to those Junior E's who aren't likely to spend a career in the military and who constitute a majority of folks in the military (in addition to saving money, which was the main point).
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Same as the military has been doing. Bigger bonuses, activate SelRes, call back IRR, hire contractors.
The last time the 10-year treasury was at 7% was 2002, we'll be lucky to see anything close to 5% in the next decade.
Yep. Also, anyone entering the service before 2018 is grandfathered into the legacy/existing system, with the option to take the new system.
The new system isn't a bad deal, it's just not as good of a deal (**if you serve at least 20 years**). If you get out before 20 years, under the new plan, you still get some retirement benefit; which stands in stark contrast to the existing system where those guys that punch out before 20 yrs get nada.
The only "losers" here are guys that join in/after 2018 and end up doing a career; come to think of it though- the real losers are the guys that got out "early" within the last few years.
I appreciate the fact your typical military member who gets out at 4-6 years can take something with him for his service. We will see what this does to long term retention and recruitment. But the fact is, very few people join the military planning on a 20+ year career. So the fact they can get out after one enlistment and have a start on a nest egg is a very good recruiting enticement.
Something I have never really appreciated is that all veterans benefits apply equally regardless of the time you invested. Certainly, anyone enlisting should get veterans benefits to one degree or another. But when the new gold plated GI Bill rolled out I thought an opportunity was missed. IMO, some of the best improvements should have been rewarded to members who stay in past a certain point. I don't see the fairness of a guy that can separate in less than 4 years (honorably, of course) and never serves in the fleet or supports the real world, and he gets the exact same benefit as the E-5/6 that spent 8-10 years in. Not fair to the service members and not good business for the DOD.
Something I have never really appreciated is that all veterans benefits apply equally regardless of the time you invested. Certainly, anyone enlisting should get veterans benefits to one degree or another. But when the new gold plated GI Bill rolled out I thought an opportunity was missed. IMO, some of the best improvements should have been rewarded to members who stay in past a certain point. I don't see the fairness of a guy that can separate in less than 4 years (honorably, of course) and never serves in the fleet or supports the real world, and he gets the exact same benefit as the E-5/6 that spent 8-10 years in. Not fair to the service members and not good business for the DOD.
I can honestly say that as an 18 year old fresh out of bootcamp, the last thing on my mind was investing.
It will take A LOT of mentorship on the part of the chiefs and div-o's to get the junior enlisted to realize what this is. Otherwise, the 18 year old that does 4 years and gets out will still have nothing to show for it.
It will take A LOT of mentorship on the part of the chiefs and div-o's to get the junior enlisted to realize what this is. Otherwise, the 18 year old that does 4 years and gets out will still have nothing to show for it.
exNavyOffRec
Well-Known Member
This is going to sound like a knock at my fellow CPO's, but how can they mentor on financial matters when often they themselves are not saving or financially stable? I know too many CPO's who didn't really have a savings because they were going to get out and work a gov't job and make "lots of money" or course many I know have ended up working at Walmart or some other place for 15 bucks an hours.
The DOD needs to have civilian financial planners work with these guys, and I don't mean some sailor that went to a one week school that starts at 10 am and ends by 3 pm with an hour lunch.
Well the problem is that senior military leadership has in all likelihood never interviewed for a job past high school, and thus doesn't understand how unwilling civilian HR is to take any kind of chance on candidates who can't check their little boxes. So no one on the military side is there to quash the "I'm a vet; I'll make six figures" delusion of so many on active duty who've never been in the private sector. You're basically starting over, but people think that all the "thanks for your service" bullshit will result in special treatment on the hiring front. It won't, and IMO, "transferable skills" are a fairy tale unless you're a pilot going to rush the airlines, a Seabee applying to be a construction manager, or something along those lines.
exNavyOffRec
Well-Known Member
I woke up from the delusion quite fast and adjusted my civilian job search strategy, and yes companies say they are pushing to hire vets like crazy, what they don't say is entry level, low pay.
There are many jobs in the military that have transferable skills, the hardest part is making sure you are using civilian terms instead of military ones, some jobs require less translation than others, and then you have the assumption that a person is looking to do in the civilian side what they did in the military, some do some don't.
I have a nuclear background, but went into recruiting/HR when I retired, my life/job search/money made would have been much easier if I had stayed in the nuclear field.
Don't be too quick to extrapolate your own experience as "standard" for everyone else. Let's be honest, your time in the Navy was non-standard. I don't want to imply that the post-Navy job market is easy, but I know dozens of former VAQ folks that are gainfully employed in various industry positions at NG, Boeing, Raytheon, etc. Even the Boeing sim instructors - some of whom are VAQ guys that got out as JOs - are making 6 figures. Not a bad retirement gig, IMO.
We're more or less saying the same thing. If you want to to do something that you can directly transfer your skillset to, you'll be fine. If you're looking to do something not directly in line with what you did in the Navy, either because you want to work in another field or because you want to live in a certain place, don't expect recruiters to fall all over you just because you were a military officer.
Yes, personally, as a first-tour mission commander getting forced out, I didn't get enough VAQ experience to buck for a lot of those jobs. I found out after interviewing for a few that they seem to like test guys, patch-wearers, post-DHs, former CVW/CSG EWOs, and the like. Such is life. But even with an IT degree, the fact that I'd been doing other than computer stuff for the past 10 years made tech guys shy away. But my details don't matter. My point isn't "woe is me;" I'm doing fine. My only point is that it's all about what you can walk into the job and do on day 1, unlike the military side where you will be taught or at least thrown in and expected to learn. Unless you can find a field that you can jump right into, be it a 1310 to the airlines, a senior ECMO to a defense contractor, a Seabee officer to public works management, or a nuke to the energy sector, it's going to be a harder fit. Not impossible, but harder. I've seen people have good luck going to grad school on the GI bill. Now they're in the same hiring pool with every other Joe Schmuck, MBA, so they've got the HR checks in the box AND the "transferable skills" (maturity, leadership, etc) that will give them a leg up. But the latter doesn't mean shit until you get the interview, and whether you get the interview will depend on checking the boxes and/or knowing someone who can get your resume in front of a hiring manager.
If this isn't a blinding flash of the obvious...
My intent is not to dissect your own situation, but it sounds like you made some assumptions about your own marketability that did not survive first contact. Since this thread is really about retirement, the fact is that most people getting out after 20+ years will have already checked most of those boxes you listed, and consequently will be much more attractive to industry than a JO with no meaningful quals or experience. Maybe you're walking back what you asserted a couple posts ago, but I still think that you paint an unnecessarily gloomy picture based on your own circumstances.