Organizations representing U.S. combat veterans are backing a proposed change to military benefits. That change would offer troops a 401(k)-style retirement plan.
Lawmakers in Washington heard from representatives of Veterans of Foreign Wars of the United States and the Iraq and Afghanistan Veterans of America. In that meeting, they heard that members of these combat veterans groups supported a change to the military's retirement benefit as it was now.
Chris Neiweem, a legislative associate for Iraq and Afghanistan Veterans of America, said, "It is fundamentally unfair that one could serve 10 or 12 years, with three, four, five or more deployments, and leave the military with absolutely no retirement benefit at all, yet a careerist who possibly never even deployed could be entitled to a full benefit package."
In all, there were 15 recommendations to overhaul the military's decades-old retirement system and the existing health care program for military families. Those proposals, which will save the Defense Department $12 billion a year in personnel costs by 2040, were backed by Obama.
Not all groups are in line with combat veterans on their support for changes in military benefits. Military retirees, for one, are unhappy with the recommendation that there should be a required increase in co-payments for health care.
The proposed changes would give troops a 401(K)-style retirement plan, with matching contributions of up to 5 percent and full vesting after just two years. Presently, most officers and enlisted personnel who serve 20 years receive annual retirement pay equal to half of their average basic pay over their last three years of service.
In order to move forward with the proposed changes and to fund the 401(k)-like defined-contribution plan, the present amount of retirement benefits would be trimmed from half their average basic pay over their last three years of service to only 40%.
There are also changes proposed for the military health care system. The program would be called Tricare Choice and would would allow recipients to choose from a list of commercial health care plans.
Many military organizations, such as the combat veterans groups mentioned above, are waiting to learn more about the changes proposed for military health care before throwing their support behind it.Other Articles
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