How Long Do You Have To Be In The Military To Get Free College
The Montgomery GI Bill extends educational benefits to any active duty member of the military who served for at least 2 years of active duty. This also extends to veterans of any branch of the military. You receive up to $1,857 each month for educational expenses, as long as you’re enrolled full-time.
How To Calculate High
This retirement plan gives the servicemember a pension based on their average basic pay for their highest 36 months of service. Under this plan, each year served is worth 2.5% toward an annual pension. For example, serving 20 years would result in a pension worth 50% of their average base pay. Each additional year served increases their base multiplier by 2.5%. So 30 years of service would be worth a 75% pension. Under this plan, the annual Cost of Living Adjustment , is based on the Consumer Price Index .
Can You Retire From The Military After 12 Years
Current Servicemember Eligibility For New Retirement System
The military has announced that current members who have less than 12 total years of service when the new plan is effective in 2018 will be able to switch over to the new system. There will be no back pay but matching contributions will begin on enrollment.
Don’t Miss: Veterans Discounts At Sears
How To Calculate Tera Retirement:
The Temporary Early Retirement Authority retirement plan is based on the above retirement plans, but it is reduced by a Reduction Factor equaling -1% for each year under 20 years served. For example, 19 years served would be 99%, 18 years would be 98%, 17 years would be 97%, etc.*
Start with whichever retirement system you chose, the High-3 or REDUX, then apply the following formula:
Active duty pay x Percent Multiple x Reduction Factor = TERA Retired Pay
In this formula, your Active Duty Pay is the average of your highest 36 months of pay, the percent multiple is the multiple based on your retirement plan and the number of years served, and the Reduction Factor is a percentage that further reduces your retirement because you didnt serve the full 20 years. Here are two examples for someone who served 15 years:
- High-3 Plan at 15 years: Average pay x = 35.625%
- REDUX Plan at 15 years: Average pay x = 28.5%
As you can see, taking the TERA early retirement option results in a much smaller retirement benefit, especially under the CSB/REDUX option.
*Calculating more than 15 years of service, but less than 20 years: It gets a little more complicated if you want to calculate your retirement benefits if you served over 15, but less than 20 years. The military gives credit for months served, so your base multiplier wouldnt necessarily be a round number, such as the 95% we used above. Here is an article which also discusses the value of an early military retirement.
General Military Retirement Rules: Qualifying
There is more than one type of military retirement categorization. You can voluntarily retire as soon as you hit the time-in-service minimum, or you can stay in uniform as long as your branch of military service will allow you to once you hit 20 or hit the minimum time-in-service requirement .
There are also involuntary retirements, and medical retirements which are sometimes referred to as disability retirement. It is very important to note the difference between a military retirement and a separation from the military.
Retirement means you served enough time in uniform to receive or be declared eligible to receive military retirement pay. Separation simply means the service member did not re-enlist or continue with a military career. In the case of separations, no retirement pay or retirement benefits are offered.
Also Check: Does Sears Have A Military Discount
Is It Worth Going Into The Military After College
The benefits of joining the military after college Joining the military as a commissioned officer can offer the best of both worlds for those who want the college experience but who also want to serve their country. Higher pay than joining as an enlisted military member. Greater opportunities for promotion and training.
Tips For Maximizing Your Tsp
The following tips can help you maximize your Thrift Savings Plan contributions. The sooner you start, the better off youll be when it comes time to retire from the military.
Contribute at least 5%.
The TSP matching contribution comprises two parts: automatic 1% match and 4% agency match. If you do not contribute at least 5% of your pay, you are not making the most of what’s being offered to you. If you are participating in the BRS but not contributing to your TSP, you will only receive the Department of Defense’s 1% automatic contribution. If you do not contribute to your TSP, you do not receive any matching contributions.
Make catch-up contributions.
Catch-up contributions are extra deposits you can begin making into a TSP any time starting in the year that you turn 50 years old, as long as you expect to make the maximum regular contribution as an eligible federal employee. This gives you the chance to save up more for your retirement. You decide how much you want to deposit, and it’s automatically deducted from your basic pay every pay period. There is a yearly limit, determined by the IRS. Catch-up contributions automatically stop when you reach the limit or when the calendar year ends whichever comes first. They don’t continue from one year to the next. You must make a new catch-up contribution election each year.
Traditional TSP vs. Roth TSP.
Weigh your options.
Stay up to date.
You May Like: Does Aspergers Disqualify From Military
Service Credit For State Of Texas Retirement
Service credit is credit for time worked. It is one of the factors used to calculate when you can retire and how much your annuity will be. As a state agency employee, you earn credit for each eligible payroll period in which you work and a retirement contribution is made. That is, you earn credit every month money from your paycheck is deposited into the ERS Retirement Trust Fund.You can meet ERS retirement eligibility by earning and/or purchasing service credit in the following ways.
What This Post Excludes
I excluded two different retirement benefits in this post.
- Postponed Retirement a special category of a deferred retirement available to people who have reached their MRA.
- Increase in FERS annuity calculation for people with20 years of service and at least 62 years of age.
I wanted to write about what you can collect if you were interested in leaving as soon as possible. Also- both of these topics require their own full posts. The postponed retirement is difficult to understand and not covered very well on the OPM website. And while you can earn a higher annuity at age 62, you lose out on the FERS supplement, so Im not sure that one is a better deal than the other.
Don’t Miss: Verizon Fios Veteran Discount
Can Retired Reservist Use Services In Germany
The concession, meaning the authorization for retired military personnel to shop at U.S. forces sales facilities which applies also to surviving dependents, retired reservists, 100 percent disabled veterans and unaccompanied dependents whose sponsor is serving in a restricted tour area granted by the German
How Can I Avoid The Costs Of The Survivor Benefit Plan
The traditional approach to implement a survivor benefit plan alternative was to purchase a low cost term insurance policy. After years of research, we discovered that this approach can backfire because only 2-3% of term insurance policies are ever paid. The other alternative is usually whole life insurance that is sold at a high cost without enough coverage.
These are the problems that we realized no one else was solving when we created the Survivor Liberty Plan. The most modern alternative to the expensive Government Insurance programs. You can learn more about how to avoid the costs of SBP and VGLI here.
Recommended Reading: Is Autism A Disqualification For The Military
Moving Household Goods And Retiree Ids
Another thing you will need to do in order to prepare for retirement is to schedule a final military-paid move where applicable. Your command support staff will have the information you need to make this appointment.
While youre working on this it is also a very good idea to contact your Pass & ID office or the appropriate customer service office on base to learn what you will be required to do in order to trade your Common Access Card for a military retiree ID that will allow you on post or on base to use the Commissary, BX/PX, and other amenities open to retired military members.
If You Become Disabled
If you become totally and permanently disabled while a state employee, you may qualify for a disability retirement. The Disability Protection section explains the disability benefit and application process more fully. Keep in mind, your disability application must be received within 12 months after terminating your state employment . If more than 12 but less than 24 months have passed since your termination and you believe you have good cause, substantiation for late filing must accompany your application.
Also Check: Veterans Discount At Sears
What Is Stop Loss
It’s also important to be familiar with the rules of stop-lossthat is, how military personnel can be required to stay past an agreed-upon date of separation in the event of a national emergency. Created after the Vietnam War, stop-loss, or involuntary extension of an enlistment contract, is a controversial provision. The military has put it into effect in recent years in several conflicts, including following the September 11, 2001, terrorist attacks on the World Trade Center in New York City.
Preparation For Civilian Life
Youve got military life down cold. Whats it like being a civilian? Time will tell. The best way to prepare is to know what to expect and have some strategies for success.
Saying goodbye: Youve been through enough moves to know what its like to leave friends who feel more like family. But these days, social media makes it easy to keep in touch.
Job searching: Ace that interview. Get a head start. You can attend the two-day track for employment in TAP, the Department of Labor Employment Workshop on your installation or through the TAP Online Learning Portal as early as two years before retirement. You can retake the workshop as many times as you like.
Miss the lifestyle? Its not as farfetched as it sounds. Youve been in a tight, exclusive community with its own unique lifestyle. Look into joining a military organization that can keep you connected and in the loop on retirement issues.
Retirement is the first step to your next successful life and career. Know whats ahead, be prepared and enjoy.,
Read Also: Sears Military Discount In Store
When And How You Get Paid
Unlike active duty pay, retired/retainer pay is only paid once per month. Your net retired/retainer pay should be sent to your financial institution by direct deposit unless you reside in a foreign country, which direct deposit is not available. Your retired pay will be deposited to your account on the first business day of the month following the end of the month.
Your first payment for retired pay normally will arrive 30 days after your release from active duty, or, on the first business day of the month following the month of first entitlement to pay. In a separate mailing, you will receive a letter which will show you how your pay was computed.
Military Retired Pay Vs Military Retirement Pay Vs Military Pension Etc
Though this article generally uses the term “military retirement”, different sources will use different terms. The Uniform Services Former Spouses Protection Act at 10 U.S. Code § 1408 uses the term “Retired or Retainer Pay”, but other parts of the same code chapter use the term “monthly retired pay.” In fact, there are a host of terms used which all mean “military retirement”. So when you see any of the following terms, you know they mean the same thing:
- U.S. Military Retirement Pay
Recommended Reading: Can You Join The Military With High Functioning Autism
How Does Being Recalled Work
The president of the United States has Presidential Reserve Call Up Authority. This means that, when needed, the president can recall individuals to military service to support military operations. Typically, this is done with a state of emergency.
In a state of emergency, the president can recall members for an indefinite period of time. If there is no state of emergency, the president is limited to call less than 200,000 Reserves and IRR members for a period of less than 365 days.
Taxation Of Military Retirement Pay
In most cases, retired pay is fully taxable. The amount of taxable income is reduced by SBP costs and any waiver for VA compensation or deduction for dual compensation . The amount deducted from your pay for federal withholding tax is based on the number of exemptions you indicate on either your pay data form or your W-4 after retirement.
State tax withholding is on a voluntary basis and must be in whole dollar amounts. $10 is the minimum monthly amount. Before making your request in writing, you must contact the taxing authority in the state in which you have established residence to determine if you are required to pay state income tax.
Retired/retainer pay is not subject to FICA deductions, nor is your retired pay reduced when you become entitled to Social Security payments.
Also Check: Does The Military Accept Autistic
Counting Other Michigan Government Service
You may be able to combine service credit you have earned with a number of governmental agencies in Michigan in order to meet eligibility requirements. Act 88 – Reciprocal Retirement Act of 1961 helps public servants who worked either full- or part-time for more than one Michigan governmental employer, but perhaps fall short of pension eligibility with any or all of them. Examples of a governmental unit include state, county, and municipal units as well as most public schools.
Combining years of service from multiple employers can help you qualify for a pension, but the other service won’t count in the calculation of your pension amount. Act 88 can’t be used to qualify someone for survivor or disability benefits – it can only be used for a regular retirement pension.
For more information about Act 88, see Act 88 – Reciprocal Retirement Act of 1961.
How Va Disability Compensation Affects Military Retirement Pay
About Ryan Guina
Ryan Guina is The Military Wallet’s founder. He is a writer, small business owner, and entrepreneur. He served over six years on active duty in the USAF and is a current member of the Illinois Air National Guard.
Ryan started The Military Wallet in 2007 after separating from active duty military service and has been writing about financial, small business, and military benefits topics since then. He also writes about personal finance and investing at Cash Money Life.
Ryan uses Personal Capital to track and manage his finances. Personal Capital is a free software program that allows him to track his net worth, balance his investment portfolio, track his income and expenses, and much more. You can open a free Personal Capital account here.
Featured In: Ryan’s writing has been featured in the following publications: Forbes, Military.com, US News & World Report, Yahoo Finance, Reserve & National Guard Magazine , Military Influencer Magazine, Cash Money Life, The Military Guide, USAA, Go Banking Rates, and many other publications.
Don’t Miss: Does Verizon Have A Military Discount
Branch Of Service Change
If none of the above reasons were compelling enough for you to join the Reserves, you can always join another branch of serviceif youre a traitor.
Im joking about that. It is quite common for people to exit the military and then decide to go into another branch of service. I know several people who have served in the Marine Corps and the Army, for example.
Every branch of service has its own personality, and it is important for you to find the one that matches with you.
Is Every Military Person A Veteran
Title 38 of the Code of Federal Regulations defines a veteran as a person who served in the active military, naval, or air service and who was discharged or released under conditions other than dishonorable. This definition explains that any individual that completed a service for any branch of armed forces
Read Also: Sears Hometown Coupons
Will I Die If I Join The Army
Can you keep the peace and keep your life? Make no mistake people can and do die during military service. The Defense Manpower Data Center, one of the Department of Defenses analytical groups, has recorded 48,834 military personnel deaths from 1980 to 2010, which works out to 1,575 deaths per year.
Frequently Asked Questions About Military Retirement
Getting a head start is critical to making the most of any service members retirement – no matter if youre with the Army, Navy, Air Force, Marines or Coast Guard. At a minimum, the transitioning process should start a year before your expiration of time-in-service date, but many people start planning even before that.
You May Like: Does La Fitness Have Military Discount
How Can My Retirement Pay Continue To Go To My Family If I Die
The Survivor Benefit Plan allows a retiree to ensure a continuous lifetime annuity for their dependents after they die. The annuity, based on a percentage of retired pay, is paid to an eligible beneficiary. Unlike some other annuities, payments can never run out. If you die before your spouse, they will continue to get monthly checks until they pass away.