Halfway through the year, about 13.5 percent of service members facing a choice between the new and legacy military retirement systems have opted in to the new Blended Retirement System, according to Defense Department officials.
As of June 30 — with six months left to make a decision — 221,872 service members had opted into BRS. That’s out of the 1.6 million service members who are eligible to choose between the new system or staying with the legacy system, DoD spokeswoman Air Force Maj. Carla Gleason said.
The Marine Corps has the highest percentage of BRS opt-ins by far: 27.2 percent, nearly 10 percentage points ahead of runner-up Navy at (17.1 percent). The Army has the smallest percentage of opt-ins at 8.8 percent.
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The BRS choice is available to active-duty service members who had fewer than 12 years of total service as of Dec. 31, 2017, and reserve-component members in a paid status with fewer than 4,320 retirement points as of Dec. 31, 2017. No one is automatically enrolled; they must make the move to opt in to BRS before the Dec. 31 deadline.
Those with more time in service as of that date had no choice — they stay with the legacy retirement system. Those entering the military in 2018 and later also have no choice — they are automatically enrolled in the BRS.
Defense officials have said they have no target, goal, preference or expectations for the choices service members make this year, because each service member’s decision is based on what’s best for his or her own personal circumstances.
Gleason said 80.4 percent of all active duty and 60.4 percent of all Reserve and Guard members who have opted into BRS this year are contributing at least 5 percent of their basic pay or drill pay to their Thrift Savings Plan. “This indicates that members who have opted in are taking full advantage of DoD’s TSP matching contributions,” she said.
But a little more than 1 in 10 service members who have switched to BRS aren’t putting any money into their TSP accounts, so DoD, service officials, and the Federal Retirement Thrift Investment Board, which administers the TSP, have mounted a campaign to emphasize this step.
Under the BRS, DoD automatically contributes 1 percent of the service member’s basic pay to the service member’s TSP, and will match up to an additional 4 percent, for a total of 5 percent match. Under the legacy system, there are no matching DoD TSP contributions.
Only about 19 percent of active-duty service members and 14 percent of reservists stay in the military long enough to earn retirement pay, under the legacy system. Under BRS, nearly every service member would get some retirement benefit even if they leave before 20 years of service, because of the TSP. An additional benefit is a one-time payout of continuation pay after reaching 12 years of service.
Those who choose BRS and reach 20 years of service still qualify for the retired pay, but it is 20 percent less than what they’d receive under the legacy system. There are other pros and cons.
Karen has covered military families, quality of life and consumer issues for Military Times for more than 30 years, and is co-author of a chapter on media coverage of military families in the book "A Battle Plan for Supporting Military Families." She previously worked for newspapers in Guam, Norfolk, Jacksonville, Fla., and Athens, Ga.