Retire at 20 years or continue to serve?

[deltarho]

I guess that E-9 who stayed for 30 and is collecting 75% Base Pay (with annual COLA increase) and perhaps not working at all at 50 years old.  Not to mention that after spending 30 years in the military, chances are that person is getting some percentage of VA Disability money.

I've had several "8 and out E-6s" that left 20 years ago telling me how stupid I was for staying in the Navy as long as I did.   I laugh and tell them how silly that DOD Program is for still giving me benefits (medical/dental) and you know...they're even still paying me each month.  The retirement benefits are NOT trivial!

Sorry to interrupt the Bluejacket Manual 101 training.  For extra credit, perhaps we need rating insignia and chevrons posted to be able to identify a ETSN or MCPON, if given the opportunity.   Then, perhaps we can compare/contrast the AF rank identification system just for fun.  

My arguement was not that they shouldn't stay in long enough to retire, but to do it at 20 years vice 30 years.  Just to give a few things to consider:

(a)  What could someone have made in those 10 years in CIVLANT or CIVPAC in addition to the 50% already due?
(b)  Annual COLA?  What is that?  I think we now must just say occassional COLA.
(c)  Referring to (a), add the "occassional" COLA, too, during those 10 years.
(d)  Over 20, the lifer has on average a 10 % service-connected disability rating--which he or she would be getting for 10 years longer--tax free.

I earned nearly a million dollars in the 10 years from 1997 to 2007 that does not include my military stipend.  I do include, however, my tax free VA service connected bonus.  I call it a bonus now that the amount I subsidize to pay for it out of my military retirement is shrinking yearly, until it will be 0% in 2015--concurrent payment was something Congress finally got right.  In some cases, waiting 10 years will lose you about 100,000 in tax free VA benefits (for that 10-year period).  There is no way to know what you will be granted by the review board prior to a decision to retire, but you can get a ballpark idea from your friendly neighborhood P' Checker.

[DDMurray]

From a previous post:

Just prior to my retirement (Nov 2008):
Base Pay:           5391.60
SDAP (Pro Pay):   300.00
Sub Pay:             425.00
BAH                   1994.00
BAS                   294

Total Comp     8404.60 (My retirement check is about $3000/ month, about 62% of 4848 - I was on high-3 retirement plan)

In Jan 2006 when I could have retired as an E-8 (at my 21 year point)
Base Pay:          4071.6
BAH:                   1763
SDAP:                  450
Sub Pay               425
Sea Pay               500   

Total Comp        7209.6    (My retirement check would have been around $2100- 52.5% of around $4000)

Had I retired at my 20 year point in 2004 my retirement check would have been around $1600 (50% of 3200).  So for 4 extra years I nearly doubled my retirement check and spent my last 3 years on AD at a job I truly enjoyed.   

Assuming I got hired at the same pay level as I did, I don't think I gave up too much.  Intangible benefits of staying in those extra years included staying at a location where both children could finish high school, I got to visit some great places and I ended up with two spinal surgeries that required convalescent leave - something that wouldn't have been easy to do at a civilian job without a major financial hit. 

Just call me Nutty.

[co60slr]

My argument was not that they shouldn't stay in long enough to retire, but to do it at 20 years vice 30 years.  Just to give a few things to consider:

(a)  What could someone have made in those 10 years in CIVLANT or CIVPAC in addition to the 50% already due?
(b)  Annual COLA?  What is that?  I think we now must just say occasional COLA.
(c)  Referring to (a), add the "occasional" COLA, too, during those 10 years.
(d)  Over 20, the lifer has on average a 10 % service-connected disability rating--which he or she would be getting for 10 years longer--tax free.

I earned nearly a million dollars in the 10 years from 1997 to 2007 that does not include my military stipend.  I do include, however, my tax free VA service connected bonus.  I call it a bonus now that the amount I subsidize to pay for it out of my military retirement is shrinking yearly, until it will be 0% in 2015--concurrent payment was something Congress finally got right.  In some cases, waiting 10 years will lose you about 100,000 in tax free VA benefits (for that 10-year period).  There is no way to know what you will be granted by the review board prior to a decision to retire, but you can get a ballpark idea from your friendly neighborhood P' Checker.

I'll concede argument, since I'm on your side.   

I'll also add that for the last 5 years, I needed to use a MS Excel spreadsheet for MY situation.  (Hint: everyone has different goals...and not everyone wants to make $1M in the next 10 years).  For example, perhaps I had a reason to stay an extra 3 years beyond 20, which MS Excel helped me conclude would be to my advantage.  However, for those that get out and go on to High School teaching, does it really matter how soon you jump for $50K in teaching salary? 

The tax-advantage situation is more compelling for the active duty sailor.  The federal tax advantage (i.e., anything with "allowance" on your LES is not taxable), along with not paying state income taxes.   On this side of the fence...your first civilian paycheck is likely to be an eye-opener.

Another hard decision for those that have to endure it, is do you retire as an O-4, or stay for 0-5?  (Six year wait time-in-grade, plus 2 or 3 year payback for retirement).   More retirement money (higher paygrade and 8 more years beyond 20 for more money).  E-9 over 20, or E-9 over 30?  MS Excel argues that situation is not nearly as financially advantageous, although DDMurray seems to have done very well with his decision.

Finally, getting out in 2010 amidst the Commercial Nuclear Revival is much sexier than the job opportunities were in 1991, 1997 (i.e., junctures where I looked and concluded the reenlistment money factored in my favor).  I know some that are watching new nuclear construction and are timing their exits accordingly.  Meanwhile, as DDMurray did, they're have fun on their "twilight tour".

Co60

[Already Gone]

The math adds up to staying for 30 if you already have 20 in.

An  E-9 with 20 years makes about $64k (base).  If he puts in his chit at that point, he gets $32k a year to retire on.

An E-9 with 30 years makes about $77k.  He'll draw a pension of about $58k.

In the interim 10 years he'll earn pay and allowances of around $960,000  (additionally, there is the tax-free nature of the allowances which makes this worth even more) and about $100k in reenlistment bonuses.

If the guy who got out at 20 earned a million in the ten year interval, plus the $320,000 he drew in pension.  He's ahead by about $260,000 at the 30 year point BUT, if he stops working at the 30 year point, his annual income will be only $32k (plus whatever return he gets from investing the $260k).  In the current economy, there is no guarantee that a good job (especially $100k/year job) will be available to him for the whole 10 year period.  Meanwhile, the 30 year retiree has had a job all along.

Revival?  Dude, there hasn't been one shovelful of dirt moved to build a new nuclear plant yet.  The next commercial nuke to be built will not be operational before 2020 at the earliest.  People with Navy nuke experience will not be required to pour concrete and weld pipes.  Your "revival" will come when there are switches you can turn to pull rods that do not currently exist.

If you're staying for 20, it makes just as much sense to stay for 30.  If two guys join at the same time at age 20, the one who gets out at age 40 will be ahead in money until they are age 59 (a significant age when you consider IRA and 401k withdrawals).  At this point, they are close to even.  After that point, it depends on who has the better job.

Your mileage may vary.

Or you can do 6 and out.  What really matters on any given day (such as the day of your EAOS) is what do you want to do for the next 2, 4, or 6 years of your life.  No point really in going beyond that.  Planning a Navy career around money is the same as planning a horse race around the price of manure.  Do what makes you happy.

See what happens when there are no moderators?

Just wait until the discussion goes from "what does the number mean?" to "what is my NEC?"

[co60slr]

Revival?  Dude, there hasn't been one shovelful of dirt moved to build a new nuclear plant yet.  The next commercial nuke to be built will not be operational before 2020 at the earliest.  People with Navy nuke experience will not be required to pour concrete and weld pipes.  Your "revival" will come when there are switches you can turn to pull rods that do not currently exist.

Here's a picture of a nuclear plant dirt mound for you:
http://www.nei.org/resourcesandstats/publicationsandmedia/insight/insight-web-extra/vogtle-3-and-4-preconstruction-approvals-activities-continue-apace

The revial has begun, but not even simmering yet.  While people are digging and pouring concrete, Training Programs have to be started.   People are needed for cold ops, testing, etc.   Hot licenses to follow.   Here are a few examples (I limited myself to a 15 second Google search):

1.  http://www.tva.gov/environment/reports/wattsbar2/

2.  http://www.simplyhired.com/a/jobs/list/q-plant+vogtle

Also, those crazy people emailing me on Linkedin.Com trying to get me to Georgia or Pittsburgh, PA (Westinghouse) must have some rabbit up their sleeves.  However, I'm not getting drawn into the GM: Outage Wars reality TV show.   You're right, the HPs will have to wait their turn for Co-59 to be turned into Co-60 and cause a deflection on their meters.   

Oh, and if the US construction wasn't bad enough on Navy retention, how about the ex-Navy Nuke Officers separating and headed to "AP1000 China".  You guys waiting in Navy DEP should take a few Chinese language lessons just in case you want to get a work visa in China after your six year tour.

Finally, part of the revival is being driven by "retirement eligible" metrics.  The recruiting schemes are being driven by what is going to happen over the next 10 years...even without a lot of dirt being moved.  So, my "revival" compares 2010 hiring trends to the early 1990s.  It's very positive for ex-Navy Nukes.   The links above are just the beginning.


Co60

[MMM]

Getting out at 20 or staying in until 30 isn't just about the money. There's also quality of life while your in. When I hit my 20 year point, I'll be finishing up shore duty, so to stay in for 30, I'm looking at two more sea tours, and at least two deployments and at least three moves. That's just not something I'm really interested in. While I plan on staying in nuclear power when I get out, and know I'll have obscenely long hours while I qualify or get my license, I will still get to come home every night and live in one place for that time. That removes a lot of stress from my life and more than makes up for the difference in retirement pay.

[DSO]

The math adds up to staying for 30 if you already have 20 in.

An  E-9 with 20 years makes about $64k (base).  If he puts in his chit at that point, he gets $32k a year to retire on.

An E-9 with 30 years makes about $77k.  He'll draw a pension of about $58k.

In the interim 10 years he'll earn pay and allowances of around $960,000  (additionally, there is the tax-free nature of the allowances which makes this worth even more) and about $100k in reenlistment bonuses.

If the guy who got out at 20 earned a million in the ten year interval, plus the $320,000 he drew in pension.  He's ahead by about $260,000 at the 30 year point BUT, if he stops working at the 30 year point, his annual income will be only $32k (plus whatever return he gets from investing the $260k).  In the current economy, there is no guarantee that a good job (especially $100k/year job) will be available to him for the whole 10 year period.  Meanwhile, the 30 year retiree has had a job all along.

Revival?  Dude, there hasn't been one shovelful of dirt moved to build a new nuclear plant yet.  The next commercial nuke to be built will not be operational before 2020 at the earliest.  People with Navy nuke experience will not be required to pour concrete and weld pipes.  Your "revival" will come when there are switches you can turn to pull rods that do not currently exist.

If you're staying for 20, it makes just as much sense to stay for 30.  If two guys join at the same time at age 20, the one who gets out at age 40 will be ahead in money until they are age 59 (a significant age when you consider IRA and 401k withdrawals).  At this point, they are close to even.  After that point, it depends on who has the better job.

Your mileage may vary.

Or you can do 6 and out.  What really matters on any given day (such as the day of your EAOS) is what do you want to do for the next 2, 4, or 6 years of your life.  No point really in going beyond that.  Planning a Navy career around money is the same as planning a horse race around the price of manure.  Do what makes you happy.

See what happens when there are no moderators?

Just wait until the discussion goes from "what does the number mean?" to "what is my NEC?"

I would say getting out at 20 is the most money-wise thing to do, not even accounting for the better quality of life. The E-9 makes approx 705k in that 10 year period and makes 32k more a year for maybe 25 yrs after his/her 30 year retirement. So for the 1st 10 years the 30 yr E-9 is down 615k (32k*10 + 10(100k-70.5k)=615k ......and for the next 25 years he makes 650k more retirement ( 58k-32k)*25=650k, but the 20 yr retiring E-9 has 10 more yrs of seniority and retirement time at his civilian job which will increase his salary progression and retirement account much more than the  35k (650k-615k) that he is shown to be behind....and really even if the 30 yr E9  was 35k ahead --thats only $3500/yr for each extra year he worked accruing no pay for hrs worked over 40....

[Mike McFarlin]

Retire.

[deltarho]

Getting out at 20 or staying in until 30 isn't just about the money. There's also quality of life while your in. When I hit my 20 year point, I'll be finishing up shore duty, so to stay in for 30, I'm looking at two more sea tours, and at least two deployments and at least three moves. That's just not something I'm really interested in. While I plan on staying in nuclear power when I get out, and know I'll have obscenely long hours while I qualify or get my license, I will still get to come home every night and live in one place for that time. That removes a lot of stress from my life and more than makes up for the difference in retirement pay.

Hear! Hear!  

I was the only TERA nuke in 1997 out of 16 who applied--got out with 18 years and 3 months.  I did it for my family.  It was quite the ordeal in itself.  

Although the 3393 NEC was specified on the TERA message as an authorized NEC, the detailer told me he would not approve my request.  When I asked why, he shot me over to the community manager because he outranked me.  I think he had been in D.C. too long; he tried to pull a good one out of his back end: "How can I on one hand go to Congress and justify maintaining large reenlistment bonuses because manning is so poor while the other hand approves an early retirement?  No way Senior Chief, ain't gonna happen on my watch."  

I asked him if he was a nuke, and whether he realized that he was talking to a nuke ETCS, not communcations or radar ET--just to make sure.  He was puzzled why I asked, but said he was and did.  "I have two problems with that train of thought.  First, as you probably know with the number of years I have in, my last reenlistment did not merit a bonus, and therefore you can tell Congress that the first three zones did the job if they ask about my early retirement; otherwise, someone in my position does not fit into your scenario.  Second, my NEC is the senior NEC for surface nukes, not 3383, which someone besides you seems to know is becoming top heavy with E-8s and E-9s on the carriers because of the decommissioning of the CGNs; otherwise, it would not be on the TERA message.  I know of two frocked E-8s still waiting to be paid after two years.  I also know the detailer plans to send me to the George Washington, which is 125% manned, and is not projected to less than 100% for the next three years.  If you are not responsible for placing the 3393 NEC on the message, I will find out who is and ask him or her why you are summarily disapproving TERA requests, which may be interpreted as usurping his or her authority in Washingtonese--I'm just sayin'."

So, I don't even get my full 50%, I get 45% of my base pay, which was not as attractive in 1997 dollars for an E-8.  But I didn't have to worry about being Red Cross emergency evacuated from the ship because my kid hanged himself from the tree in the front yard like one of my fellow Seniors from my last ship did.  At least I have myself to blame for all the problems at home now, being the head and all--AND PRESENT.

Oh, the mystery of it all it...obvious why I never got a personal medal higher in ranking than a Good Conduct (i.e., no NAM or better) not so obvious how I made E-8 in 11 1/2.  

[jowlman]

Not that this is really on topic, but I think that this is funny that I saw this topic today. 30 years ago today, I started boot camp.

[RCLCPO]

I agree with MMM: quality of life is a huge factor.

My goal was to retire before my kids were old enough to remember me being gone all the time.

Rather than return to sea duty, I retired at the 21 year point (in 2005), and now manage 4 cogeneration power plants in California.

No nuclear stresses involved--especially since all of my power plant operators are also ex-Navy Nukes.

Weigh all of the pros and cons, financial and otherwise, and assign weights to the various factors on a scale of 1-10.  If you're realistic, the math will then point the way.

[Neutron_Herder]

I guess it all depends on what makes you happy... 

If you like really being a Nuke, and by that I mean operating the plant, knowing the plant, and being assessed by you ability to do so then I say get out.

On the other hand, if you like the collateral duties, losing touch with what really is going on in the engineroom,  and being graded upon your involvement as part of the "Navy machine" then I say stay in!

I did 21 years, and I have a lot to thank the Navy for.  Job satisfaction during the last few years of my career was not one of them.  Lots of people lose sight of what their job really is as a Navy Nuke, and end being more of a politician than an operator.  Unfortunately, advancement in the Navy in the higher ranks has nothing to do with your ability to operate the plant...  It has more to do with what else you do.

Just my opinion, but that attitude is going to end badly.  You can't rely on the people with minimal experience to make huge decisions forever without it catching up with you eventually!

[MMM]

That's probably why I won't make chief. Oh, well, 4 years then I get to be a civilian nuke.

[deltarho]

That's probably why I won't make chief. Oh, well, 4 years then I get to be a civilian nuke.

Chiefs are not "made," meaning you cannot make chief.  King Neptune appoints those he deems superiorly qualified to carry on the more than 200-year tradition that sets Navy, initiated Chiefs apart from E-7s in all the other military branches and Department of Transportation/Department of Homeland Security/Department of the Navy when transferred during wartime (whichever way the wind happens to be blowing for the Coast Guard that day).

Now that you've seen the results of the selection process, is there any doubt in your mind that King Neptune is a false god?  There is only one true God (Note: And He cautions us about how we support our leaders in Hebrews 13:17 in the ESV: "Obey your leaders and submit to them, for they are keeping watch over your souls, as those who will have to give an account. Let them do this with joy and not with groaning, for that would be of no advantage to you.")--this ain't the prince of the power of the air, the spirit that is now at work in the sons of disobedience talked about in Ephesians 2:2.

SMITE AWAY!!!!!!!!!!!!!!!!!

[Gamecock]

SMITE AWAY!!!!!!!!!!!!!!!!!

No Smite!!!

to you!!

[MMM]

That's probably why I won't make chief. Oh, well, 4 years then I get to be a civilian nuke.

This was actually to annoy my wife, who was reading over my shoulder at the time.

I've seen people put on their anchors, and every other kakhi ask how it happened. Never realizing they wrote the evals to make them look good and advance. My last COC finally started picking up on the idea of changing how they do the rankings. First, being qualified PPWS to get an EP. Second, if you didn't make board, you would get an MP (max) on your next eval, regardless (the thought being why waste an EP if you're not getting to the board). I almost feel bad about transferring.

[DDMurray]

..... First, being qualified PPWS to get an EP. Second, if you didn't make board, you would get an MP (max) on your next eval, regardless (the thought being why waste an EP if you're not getting to the board). .....

Sounds like the kind of command I wouldn't want to serve on. 

So year 1, you're EP because of your performance, but you do poorly on the exam.  This looks like a guy (or girl) who needs some help with the exam.  Maybe the command should help this sailor study for the exam.  Dropping an EP to MP without cause will hurt his chances when he does make the board.  I doubt the eval said, "Though this person's deckplate performance has been superb, his eval was downgraded due to his poor performance on the CPO exam."

Wasting an EP is giving it to someone who doesn't deserve it.  Some of my biggest diasagreements with my bosses late in my career were over shuffling the fit-rep rankings to "help" those who were in highly competitive rates at the selection board.   

[MMM]

DD,
I agree with you on that point. For people who show after it starts, it might not be an issue, as their rank won't drop, but for the guys that are there now, it might be an issue. Granted, all the guys I know who didn't make board were also not qualified PPWS, so I'm a little less annoyed. I do know that working on PWS definitely helps with the test.