WASHINGTON — The Veterans of
Foreign Wars of the United States is urging the U.S. House of Representatives
to approve the National Defense Authorization Act when it comes up for a vote
next week.
The $495.9 billion base budget provides additional funding for fighter aircraft, helicopters,
ship building and missile defense. It also includes VFW-supported provisions to
improve financial literacy training and create a new blended military
retirement system, beginning Oct. 1, 2017, that VFW National Commander John W.
Stroud says will benefit all who serve in uniform, not just the 17 percent who
serve 20 years or longer.
“Aside from hostilities,
one of the greatest threats to an All-Volunteer Force is a strong economy that
offers other employment options,” said Stroud, who wants the Senate Armed
Services Committee to retain the new retirement feature when it begins
discussing the fiscal year 2016 defense bill next week. “In order to meet
future enlistment and retention goals, the military must be able to compete
with a civilian sector that by and large offers some type of contributory
retirement program for its employees.”
Enhancing financial
education and modernizing the military retirement system are two of 15
recommendations made by the Military Compensation and Retirement Modernization
Commission. The retirement proposal creates a government match to individual
Thrift Savings Plan investment accounts, plus adds a one-time continuation
bonus at the 12-year-mark as an extra reenlistment incentive. Those who retire
at 20 would see their retirement pay percentage drop from 50 percent of base
pay to 40 percent, but due to compound interest and the government match, the
overall package’s worth should be considerably more. The TSP account can also
be rolled over into other 401(k)-type investment programs, plus its proceeds
can be passed along to heirs, whereas just a portion of military retiree pay
can go to surviving spouses. Everyone in uniform prior to the implementation
date would be grandfathered under the old system but with an opportunity to opt
into the new.
The VFW national
commander extends his appreciation to HASC Chairman Mac Thornberry (R-Texas)
and Ranking Member Adam Smith (D-Wash.), and Military Personnel Subcommittee
Chairman Joe Heck (R-Nev.) and Ranking Member Susan Davis (D-Calif.), for their
willingness to include both recommendations in the 2016 defense bill, and for inserting
a provision to continue the government match throughout an individual’s career,
and not just stopping at 20 years, as originally proposed by the retirement
commission.
“I have
always said that if you take care of the troops, they will take care of the
mission,” said Stroud, a retired Air Force first sergeant. “Allowing our troops
and their families to build retirement nest eggs sends a powerful message of
appreciation, which could result in this becoming the military’s greatest
recruiting and retention tool ever.”
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ABOUT
THE VFW:
The Veterans of Foreign Wars of the U.S. is a nonprofit veterans service
organization comprised of eligible veterans and military service members from
the active, Guard and Reserve forces. Founded in 1899 and chartered by Congress
in 1936, the VFW is the nation's largest organization of war veterans and its
oldest major veterans organization. With nearly 1.9 million VFW and Auxiliary
members located in more than 6,800 Posts worldwide,
“NO ONE DOES MORE FOR
VETERANS.” The VFW and its Auxiliaries are dedicated to veterans’ service,
legislative advocacy, and military and community service programs. For more
information or to join, visit our website at
www.vfw.org.
Contact: Joe Davis, Director of Public Affairs, VFW
Washington Office, jdavis@vfw.org