Blended Retirement System
Currently, 81 percent of active service members leave the military with no retirement benefits. The new Blended Retirement System (BRS) will ensure that nearly 85 percent of military service members leave the service with retirement benefits.
Below you will find an overview of the BRS, including information about eligibility, opt-in dates and next steps. Get retirement ready! Now is the time to educate yourself about the BRS so that you can take decisive action in 2018. Military Saves is here to help.
The Blended Retirement System (BRS) is the new military retirement system that combines the 20-year military retirement (the defined annuity), with a defined contribution plan, known as the Thrift Savings Plan (TSP), as it's more commonly referred to.
The defined contribution component or TSP, includes automatic 1 percent DoD contributions after 60-days and up to 4 percent additional matching contributions after two years of service to the member's TSP account. That can mean a lot of retirement savings for you if you do your part--make an informed decision and commit to automatic retirement savings.
The BRS goes into effect between January 1 and December 31, 2018.
(click image to view poster)
Am I eligible?
All members serving as of December 31, 2017 are grandfathered in the currently legacy retirement system. No one currently serving will be automatically moved to the Blended Retirement System. If you wish to move to the Blended Retirement System you will need to "opt-in" during the one-year opt-in period, January 1 - December 31, 2018.
Active duty service members with fewer than 12 years of total service as of Dec. 31, 2017 are eligible to opt into the BRS.
Reserve and National Guard:
Reservists with fewer than 4,320 retirement points as of Dec. 31, 2017, are eligible to opt into the BRS.
How do I opt-in?
Eligible members have all of CY2018 to educate themselves about the BRS and make their decision by December 31, 2018.
If an eligible service member wants to stay covered under current system - they do nothing.
If an eligible service member decides the BRS is better, they must opt-in by Dec. 31, 2018.
All service members who enter the military on or after January 1, 2018 will automatically be enrolled in the BRS.
By creating a good savings habit you will set yourself up for success in preparation for the BRS. Jumpstart your financial fitness by creating healthy savings habits:
- Save automatically (through direct deposit, automatic transfer from checking to savings or allotment)
- Spend less than you earn and save the difference
- Take the Military Saves Pledge to set short-term and long-term savings goals
- Set up a separate savings account for emergencies
- Pay down (and manage) debt
- Save for retirement, automatically, and take informed action in the Blended Retirement System (BRS)
Take the BRS Opt-in Course
To ensure service members fully understand their retirement plan options, all eligible service members will be required to take the BRS Opt-In Course, (CAC required version, non-CAC version). The course is mandatory and must be completed before a service member can opt-in to the BRS.
Use the DoD Comparison Calculator
The DoD Comparison Calculator is designed to assist eligible service members in comparing the legacy military retirement system (commonly referred to as the High-3 System) and the Blended Retirement System. It is intended to be used in conjunction with the mandatory BRS Opt-In Course. The Opt-In Course should be taken prior to using the calculator.
To learn more about BRS, visit the one-stop DoD shop at http://militarypay.defense.gov/BlendedRetirement/. Here, in addition to the BRS Opt-in course, you will find infographics, timelines, informational videos, and in late February, the BRS calculators to help you run the numbers.
Defense Credit Union Council - Blended Retirement System Guide
FINRA Educational Foundation - SaveandInvest.org
USAA Educational Foundation - Command Your Cash
If you're looking for a coach in your corner to give you the gentle nudge towards setting savings goals and following through on them, Military Saves has you covered.
Take the Military Saves Pledge to set your savings goal and follow the prompts to opt-in to receive text message reminders and tips, and for the latest updates on the Blended Retirement System. Think of us as your personal financial support system!
- Written by Katie Bryan
- Category: Uncategorised
- Published: 22 February 2017