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Proposed Changes to the Military Retirement System (CRS Report for Congress)

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Release Date Feb. 25, 2015
Report Number IF10141
Report Type In Focus
Source Agency Congressional Research Service
Summary:

The military retirement system is a noncontributory, defined benefit system that has historically been viewed as a significant incentive in retaining a career military force. The system currently includes monthly compensation upon completion of an active or reserve military career, disability benefits for those deemed medically unfit to serve, and a survivor annuity program for the eligible survivors of deceased retirees. The amount of compensation is dependent on time served, and basic pay around the time of retirement. Retired pay is adjusted annually through a Cost-of-Living-Adjustment (COLA).  The costs of the military retirement program have been rising modestly each year, due to a predictable slow rise in the number of retirees and survivors and COLA increases. In FY2013, $54 billion was paid to approximately 2.2 million military retirees and survivors. When considering changes to the retirement system Congress grapples with both budget constraints and constituent concerns.

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