Yellow sign reading, "What's your plan for retirement?"

Four Ways to Maximize Your Retirement through the Blended Retirement System

By The USAA Educational Foundation

As of January 1, 2018, the new Blended Retirement System (BRS) took effect for eligible service members. The plan includes a smaller 20-year military retirement annuity, automatic and matching contributions to the Thrift Savings Plan (TSP), a mid-career continuation pay component, and lump-sum distribution options at retirement. Here are four ways you can maximize your retirement with the Blended Retirement System.

How to Win With the Military’s New BRS from USAAEF on Vimeo.

1. Invest at least five percent of your pay into the Thrift Savings Plan (TSP).

Your branch of service will automatically add one percent of your basic pay to your TSP account.  They’ll also match any contributions you make up to 5 percent of your basic pay. When you put in 5 percent, they’ll put in 4 percent. Add the 1 percent automatic contribution and you’ll have 10 percent of your pay going toward retirement. (Note: vesting rules apply)

2. Learn how to invest within the Thrift Savings Plan.

The TSP offers a wide range of investment funds, including funds that invest in stocks and bonds. There’s also guaranteed fund and Lifecycle funds you can use. To optimize your success, it’s best to come up with an investment plan and stick with it. Try not to switch things up in reaction to market moves. Visit TSP.gov to learn more.  

3. Make the most out of your continuation pay.

Continuation pay is a mid-career payment you’ll receive in exchange for serving at least three more years in the military. While it may be tempting to use this money to treat yourself to a vacation or buy a new car, it’s often better to invest it in your future.

4. Stay in the military for at least 20 years.

In most cases, you must serve at least 20 years to receive the pension portion of the BRS. To calculate your monthly pension payment, multiply two percent, times years of service, times retired base pay. Your pension amount can increase each year with cost of living adjustments. If you leave the military before reaching 20 years of service, you will typically not be eligible for this benefit. 

Saving for retirement is a critical part of your financial future. That’s why it’s so important to start planning for retirement today.


Are you trying to save money? Let Military Saves help you reach your savings and debt reduction goals. It all starts when you make a commitment to yourself to save. We'll keep you motivated with information, advice, tips, and reminders to help you reach your savings goal. Think of us as your own personal support system.

TAKE THE PLEDGE


Struggling to plan for retirement? @usaaef has a great video to walk you through some retirement-planning basics as a service member >> http://bit.ly/2owO5wz @MilitarySaves #BlendedRetirementSystem

Tweet this now

Tip of the Day

  • Written by Katie Bryan | November 22, 2013

    Find places to cut your #spending so that you can pay down #debt faster: http://ow.ly/fzT2h  

Saver Stories View all »

Setting a Goal Leads to Success

Written by Super User | May 24, 2019

Growing up, Marisa’s dad had always talked about saving first, but she said she didn’t really internalize it until much later. “I was drifting along with no plan, carrying a little bit of revolving debt, saving some money here and there, but without a real plan for it.”

Read more...

How Smart Financial Decisions Can Create Opportunities 

Written by | November 22, 2019

Written by Stephen Ross, America Saves Program Coordinator | November 22, 2019

Of the many stories Military Saves shares, most describe how someone was in dire straits financially and worked their way out of it with the help of Military Saves. This time we want to highlight a different kind of story. This is a story about how responsible financial decisions can build on one another to create opportunities you thought only the super-rich enjoy.

Read more...

When You Start Small, Saving is Easy

Written by Lila Quintiliani | August 12, 2019

When Attiyya first got married, she and her Marine husband had just graduated from college and were focused on paying off student loan debt. They had both attended private schools and had sizeable loans. Then three months after the wedding, the couple found out they were pregnant with their first child.

The first year of their marriage, says Attiyya, was a balancing act between paying down debt and saving for the future.

Read more...