Defense Department Offers New Retirement System for 2018
Starting this year, U.S. service members will have two choices when it comes to their retirement plans -- a traditional pension or a hybrid plan that combines a monthly check with an investment account, which the government will contribute to. AARP reports the aim of the Blended Retirement System, or BRS, is to provide retirement benefits to more service members and make the military more competitive with the private sector.
AARP reports current military retirees receive a traditional pension check each month based on their years of service and pay. Retirees have to serve at least 20 years before they are eligible for the benefit. Only 19 percent of active-duty members and 14 percent of reservists serve for that long. According to AARP, under the BRS, 85 percent of service members are expected to receive retirement benefits.
The new system does not affect veterans or current military retirees.