Posted on Dec 17, 2018
Should I opt in to BRS or stay legacy with 11 years in?
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If I currently have 11 years invested in the military and already are already contributing 5% on the legacy system, is it worth it for me to go over to the BRS? I am a little confused on the matching 5% that the BRS offers. Does this mean if I am already contributing 5% then the BRS will give an additional 5% to make 10? The G fund under the TSP is conservative enough that you will not lose any principal so what is the incentive here?
I also went onto the website and am being told that I will also not be eligible for the continuation pay. If i enrolled prior to 12 years, why would I not be eligible? I am planning on doing my 20 as long as the military lets me, but want to make sure that I get something if they give me the boot just in case.
I also went onto the website and am being told that I will also not be eligible for the continuation pay. If i enrolled prior to 12 years, why would I not be eligible? I am planning on doing my 20 as long as the military lets me, but want to make sure that I get something if they give me the boot just in case.
Posted 6 y ago
Responses: 10
You're outside of the window where there's even a comparison between the two. Stay in the Legacy plan.
Keep doing what you're doing, and put as much as possible in your TSP. If you can, put 10% or more and make sure it's not in the G fund.
I would recommend reading about the TSP funds and how they compare to the larger funds that they're supposed to mimic.
If you don't want to read or play around with it, then move your money to the most appropriate L fund for the year you plan on retiring.
Your pension is guaranteed, for lack of a better term. Your investment is not.
Keep doing what you're doing, and put as much as possible in your TSP. If you can, put 10% or more and make sure it's not in the G fund.
I would recommend reading about the TSP funds and how they compare to the larger funds that they're supposed to mimic.
If you don't want to read or play around with it, then move your money to the most appropriate L fund for the year you plan on retiring.
Your pension is guaranteed, for lack of a better term. Your investment is not.
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Also, my two cents on a Financial Advisor. I have a BBA in Finance from the University of Wisconsin, and I manage my Mothers trust for retirement, so I am also a trustee making investment decisions quarterly. Anyways, my advice to anyone in the Military is this. Trust nobody 100% that says they are a financial advisor........trust has to be earned over time and across at least one bad downturn. Lots and lots of crappy people in that field and I have hit more than my fair share. Learn how to invest for retirement on your own. It is not rocket science, it will not take more than 15-20 min of your time each day and the payoff to you is you get to earn a larger nest egg. So spend $15-25 and subscribe to Kiplingers Personal Finance Magazine. Read it monthly specifically learn from their recommended stock picks what they are looking at in each company. Try some investing on your own with make believe money. Track your returns. Take a stock investing course at a local community college if you have time.......it will be the best time and money you ever spent in your life. You can learn how to do this over time with experience, it is really very easy after you get some experience. Also, everyone gets burned at least once in this game......nothing can stop that. So be prepared when it happens but think long term and that is where tracking your gains helps. Are you gaining more over time than your losing? Are your returns usually above the Stock index funds? If the answer is yes to both questions than who cares about the lost money. Even Warren Buffet losses billions every once in a while. His gains far exceed his losses, so it does not matter.
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You should punch your info into the BRS Comparison calculator.
Personally, I would stay legacy. The strength of the BRS is the matching in the TSP and you've missed out on 11 years of matching.
The matching is slightly more complex than a 1 for 1 match. Off the top of my head, you contribute 5%, they match 3.5% plus an automatic 1% and there's another 0.5% in there somewhere that totals 10%.
As for the G fund, you're not actually supposed to put your money there, that's just the default. There is an L fund that distributes your funds according to risk based on your projected retirement date and automatically adjust them as you age.
If you are not eligible for continuation pay, then you aren't eligible for BRS, at least for the Army. It gets more complicated if you are prior service. The mark for CP and BRS eligibility is 12 years. If you have prior service, the 12 years for BRS eligibility is based off your PEBD, not your BASD.
There's no reason to expect you'll get kicked out. There is no two time non select for enlisted like officers deal with. You could spend 14 years as a mediocre SSG and still retire as long as you don't get in trouble.
Personally, I would stay legacy. The strength of the BRS is the matching in the TSP and you've missed out on 11 years of matching.
The matching is slightly more complex than a 1 for 1 match. Off the top of my head, you contribute 5%, they match 3.5% plus an automatic 1% and there's another 0.5% in there somewhere that totals 10%.
As for the G fund, you're not actually supposed to put your money there, that's just the default. There is an L fund that distributes your funds according to risk based on your projected retirement date and automatically adjust them as you age.
If you are not eligible for continuation pay, then you aren't eligible for BRS, at least for the Army. It gets more complicated if you are prior service. The mark for CP and BRS eligibility is 12 years. If you have prior service, the 12 years for BRS eligibility is based off your PEBD, not your BASD.
There's no reason to expect you'll get kicked out. There is no two time non select for enlisted like officers deal with. You could spend 14 years as a mediocre SSG and still retire as long as you don't get in trouble.
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SFC (Join to see)
SFC (Join to see) thank you. I was trying to do that from memory and it wasn't happening at 5 am here.
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SFC (Join to see)
SPC Erich Guenther you still receive your pension at 20 years with the new system, but you receive 40% base pay, instead of 50% base pay of the legacy system. Plus the new one allows you to take a lump sum cash out when you separate the service.
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SFC (Join to see)
Yes, SFC (Join to see). They flash the "liquidity" of the new investment plan, but that's not the point of a retirement fund. It's to be a self-sustainable interest producing annuity, not a severance check.
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SFC (Join to see)
SFC (Join to see) I'm just pointing out the additional differences between the plans. The cash-out option is just an option oh, and that gives the soldiers a resource for funding a business after retirement. A lot of retirees go on to start businesses after the army
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