The military is trumpeting the opt-in enrollment numbers for its new Blended Retirement System.
The Department of Defense says more than 400,000 service members chose to opt into BRS during the enrollment period, and more than 150,000 new members were automatically enrolled upon entering the service.
However, the number of service members who switched from the traditional (and more generous) system to the DC-style plan fell far short of projections. Actuaries had predicted a higher number of younger service members would switch to better take advantage of asset appreciation over time.
In total, over half a million uniformed service members are now covered by BRS and able to begin receiving portable, government-provided retirement benefits.
BRS is the largest change to military retirement since World War II.
It combines a traditional pension, in most cases earned once a member serves at least 20 years, with a 401k-style savings plan through the federal government’s Thrift Savings Plan (TSP).
The government contributions to TSP are vested early in a member’s career and go with that member when they leave the military even if they do not serve a full 20 years.
Because of this, the DOD claims BRS significantly expands the number of Service members who will receive government retirement benefits.
The hiccup didn’t slow the celebration.
“The department is proud of the success of BRS implementation, which was made possible through a comprehensive training program for over 1.6 million people, an award-winning strategic communications outreach effort, and the cooperation, support, and extraordinary efforts of many agencies across the whole of government as well as numerous military and veterans service organizations and community partners,” the DOD said in a statement.
In just the first year, DOD contributed over $300 million to the TSP accounts of those service members participating in BRS.
“We are immensely proud of the incredible efforts it took to design and implement the policy and educate and train our forces on the Blended Retirement System,” added the Honorable Mr. James Stewart, who is performing the duties of the Under Secretary of Defense for Personnel and Readiness. “We see BRS as an important change that will set America’s service members on the path toward greater financial flexibility, responsibility, and security.”