Military Banking Rates

Proposed National Guard and Reserve Retirement Changes

By

Posted in Articles

National Guard

The Army and Air National Guard reserves are one of the military’s best-kept secrets. Where else can you find a part-time job that offers education and health care benefits, and a pension? The quick answer is that you can’t.

You also can’t find a part-time job that gives you military retirement benefits and credit for the years you worked in a full-time capacity.

National Guard and Reserves Retirement

Reserve Corps retirement benefits are the primary reason many members of the National Guard and Reserves continue serving, especially through the recent years of high deployments in support of the War on Terror. Unfortunately, the war came with a high price tag, and now Congress and the Department of Defense are looking for ways to reduce military expenditures as part of a new balanced budget initiative.

The Department of Defense commissioned a study on military pay and benefits. The 11th Quadrennial Review of Military Compensation (QRMC) recommended changes to Guard and Reserve drill pay and to military retirement benefits.

Their recommendations for National Guard and Reserve pay include reducing the number of drill days Reserve Corps members can earn in any given drill period or year. It’s not all bad though; some possible changes could result in receiving retirement benefits at an earlier age, depending on when you first entered military service.

The recommendations and possible changes that could affect the Guard and Reserves include:

  • Simplifying Reserve Corps pay and benefits
  • Reducing the number of drill days earned per drill period
  • Qualified retirees would earn retirement benefits 30 years from the date they entered military service, or at age 60, whichever comes first (provided 20 years of qualifying service has been fulfilled).
The main downside for National Guard and Reserve members is less pay for drill periods and fewer retirement points.

Currently, Guard and Reserve members are paid for two days of service and earn two retirement points per day of drill service. The proposed rules would reduce this to one day of pay and one retirement point per day of drill service.

The new rules would also compensate members with prorated BAH and BAS for each day of service. The goal is to give Reserve Corps members the same pay and benefits as Active Duty military members, thus simplifying pay and earnings statements and reducing the various pay systems used by the Reserve Corps.

Military Retirement Changes in Action

Members of the National Guard and Army Reserve currently receive retirement benefits at age 60, so this change could be a huge benefit for many Reserve Corps members.

For example, if you joined the Army at age 18 and served on active duty for four years, then transitioned to the Army Reserve, you could retire from the Army Reserve after 20 years, and begin receiving retirement benefits at age 48, instead of the current qualifying age of 60.

Depending on your individual circumstance, receiving early military retirement benefits can far outweigh receiving less pay and fewer retirement points for current service.

What are your thoughts on these proposed changes to National Guard and Army Reserve retirement benefits?

Photo: caguard