In this episode Mike and Amy continue their series on the military’s Blended Retirement System focusing on the mid-career Continuation Pay.
Takeaways
- Continuation pay is a mid-career retention tool in the Blended Retirement System (BRS) that incentivizes service members between their seventh and 12th years of service.
- Continuation pay does not impact the pension.
- Each service sets the multiplier for continuation pay, which can range from 2.5 times to 13 times the monthly base pay.
- The service obligation for continuation pay is four years from when the paperwork is executed.
- Service members can choose to receive the pay as a lump sum or spread it over multiple years.
- It's important to consider the tax implications and TSP contributions when making the decision.
- The Army has a pending change to the window for requesting continuation pay, so service members should stay informed.
- It's crucial not to leave this money on the table unless you’re certain you’re leaving the service soon.
Chapters
00:00 Introduction to Continuation Pay in the Blended Retirement System
03:07 Understanding Continuation Pay as a Mid-Career Retention Tool
07:32 Exploring the Multiplier and Service Obligation of Continuation Pay
09:35 The Pending Change to the Army's Window for Requesting Continuation Pay
13:07 Continuation Pay in the Army and Marines
16:20 Maximizing Continuation Pay Benefits and Conclusion
Links
DOD Memo: https://militarypay.defense.gov/Portals/3/Documents/BlendedRetirementDocuments/Continuation%20Pay%20Rates%202024.pdf?ver=_TMhTRRq5EgN3AMoZvwWog%3D%3D
USAF: https://www.myairforcebenefits.us.af.mil/Benefit-Library/Federal-Benefits/Continuation-Pay-?serv=26
Army: https://myarmybenefits.us.army.mil/Benefit-Library/Federal-Benefits/Continuation-Pay?serv=125
Navy: https://www.mynavyhr.navy.mil/Portals/55/Messages/NAVADMIN/FACT_SHEETS/Fact_Sheet_NAV_118_23.pdf?ver=tuyon2ijtBCS7xJJkWlybg%3D%3D
Marines: https://www.marines.mil/News/Messages/Messages-Display/Article/3240458/calendar-year-2024-continuation-pay-program-for-blended-retirement-system-parti/
Operation Retirement Readiness: www.operationretirementreadiness.com
Schedule a consultation with Mike: https://nextmissionfinancialplanning.com/contact/
Schedule a consultation with Amy: https://www.instarfp.com/contact
Disclaimer: This podcast represents the views of the hosts and any guests. It is for informational purposes only and should not be considered tax, financial, or legal advice. All information is regarded to be from reliable sources. The hosts are not responsible for any losses, damages, or liabilities that may arise from the use of this podcast. This podcast is not intended to replace professional, individualized advice.
