Saving for Retirement When You’re in the Military
Many service members who stay in the military for 20 years can benefit from a valuable pension that can start paying out as soon as they retire — even if they’re much younger than 65. But unlike most civilian pensions, there is no partial vesting under the current retirement system; if you stay for 19 years, you’ll get nothing. Most service members don’t stay long enough to qualify for the pension, so it’s important to save on your own, too.
Even if you do get the pension, it usually covers only 50% or less of your base salary if you retire at 20 years (it’s more if you stay in the service longer). You can use the Department of Defense’s military compensation calculators to estimate your pension payouts under several pension systems. The military retirement system is scheduled to change in January 2018 to a new “blended retirement system,” which will feature partial vesting. People who joined the service after 2006 will have the choice to stay with the current plan or join the new one.
See this FAQ from the Defense Department about the new retirement system for more information.
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