Five Risks that Military Retirement Mitigate

Robert Powell, writing for Market Watch, quoted the Society of Actuaries story saying that retirees face financial five risks that have to be actively managed.

These risks are:

1. Inflation
2. Outliving one's assets
3. Loss of spouse
4. Declining health
5. Medical expenses

Here's how a military retirement can mitigate these risks:

Inflation: Your retirement benefit is adjusted annually to keep pace with inflation unless you accept the REDUX retirement. (See my post on why the REDUX isn't a great idea.)

Outliving one's assets: The military retirement is guaranteed by the U.S. Government for the life of the military retiree.

Loss of spouse: If you opt for the Survivor Benefit Plan at retirement, your spouse is guaranteed up to 55% of your retirement benefit for life!

Declining health: This risk refers to long-term care. Military members have access to a wide variety of world class long-term care options. The government also offers a long term care insurance program. You can get a quote for coverage at the Federal Long Term Care Insurance Program web site.

Medical expenses: Have you heard of Tricare-for-life? The fees for this service have been going up but compared to traditional pay-for-service plans, the fees are much lower. You can go to the Tricare web site for more details on this incredible retiree benefit.

BOTTOM LINE: The generous military retirement answers these five concerns vigorously. As the U.S. Federal budget gets squeezed, I encourage all military members to pay attention to these benefits. Stay involved with military issues political organizations such as the American Legion and Veterans of Foreign Wars, and to write to their elected officials. Let them know how important these benefits are to those who have devoted their lives to protecting our nation.