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View Poll Results: Is your public pension COLA'd?
No, it is a fixed amount 4 10.26%
It is partially COLA'd 13 33.33%
It is fully COLA'd 21 53.85%
Other 1 2.56%
Voters: 39. You may not vote on this poll

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Old 10-23-2010, 06:51 PM   #21
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Quote:
Originally Posted by Amethyst View Post
Still wondering (since my question on another thread got derailed),is a military reserve pension the same as a regular military pension for same rank at retirement?

A.
Sorry I missed your question the first time...all these polls!!!

The answer is...it depends. If an active duty military serves for 20 years, and a reservist serves for the same period, and they both have identical rank...the answer is no, EXCEPT: The active duty member's retirement is based on rank, number of years & a percentage of their final base pay.

A reservist's retirement is calculated on some of the same things, like rank, number of years, but....there is also a calculation of points accrued over the career of the member. A reservist only gets points for time actually served (mostly, lol...they also do get 15 "membership points each year). Basically, a reservist is on duty one weekend a month (4 -4 hr periods x 1 point each = total of 4 points per weekend drill). Then, they also get one point per each day they are on "orders", which primarily means the 15 or so days each year when they are performing their annual tour, also known in the old days as "summer camp". Basically, a reservist who just does the normal, typical year of duty, will end up with somewhere around 75 points, more or less per year. Compare that to an active duty person who is presumed to earn 365 "points" because they are considered on duty every day. Active duty personnnel aren't really paid on points, however, if a reservist is ordered to active duty for any reason, then they get one point for each day of their duty. So....in theory, and sometimes in practice, a reservist who spends a whole lot of extra duty time on military orders could possibly earn enought points to add up to close to an active duty retirement check. From the enlisted side though, I can tell you that the Air Force really doesn't encourage this and I've seen reservists getting too close to that many points and the Air Force tells them it's time to go. Mostly, this has happened to former active duty personnel who were paid a lump sum to leave the service due to overmanning situations, and then later they joined the reserves, trying to basically get paid to ER yet also earn a full retirement.

For the vast majority of reservists, their retirement never adds up to an active duty-size pension. However, something to keep in mind is that when an active duty person leaves AD but does not retire, they are awarded one retirement point for every day they served on active duty. Those points are added to whatever number of points they can accumulate over the rest of their reserve career. For example, I left active duty after 4 1/2 years. I then spent the rest of my career in the reserves. For the 4 1/2 year AD time, I earned 1642 points. Over the remainder of my career, I earned points at teh normal reserves rate, some years only around 75 points, other years a little over 100. So...when I retired this year, I had a total of 4000 points. That point total factored into the rank/years of service equation, and so when I retire, basically my penson will only be between 1/2 & 3/4 of what it would be if I had stayed on active duty & retired from there. 7300 points is required for a full 20 year active duty - size retirement. ( 365 x 20). As far as what you asked about your friend the O-6, I will have to say, yes...I think it's possible. I knew a guy who retired from active duty as an E-7, and then joined the reserves. I know for sure he's made E-8 now, and I believe he told me he'd retire with the higher rank. Howver, I also believe that while he's in the reserves, because he's drawing the retired pay...he forfiets the amount of the reserve paycheck. I'm not 100% on that, but I think so. So the only draw for him would be the attraction of making the additional rank, which he can then re-retire with. I'll double check that part, but I think that's right. Whew.....now I'm tired!

added afterthough: I've known reservists who had spent 6-8-10-12 or 15 years on active duty, before leaving without retiring and then joining the reserves. For them, the retirement check's gonna be much bigger than mine. I did the classic one-term service on active duty & then left. That's more the norm, but there are plenty of reservists out there who will be getting pretty nice checks once they reach age 60.
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Old 10-23-2010, 07:19 PM   #22
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The results here are surprising me! Before the poll, I would have guessed that partial COLA was more common than full COLA.
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Old 10-23-2010, 07:34 PM   #23
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Originally Posted by Amethyst View Post
Still wondering (since my question on another thread got derailed),is a military reserve pension the same as a regular military pension for same rank at retirement?

A.
No. Generally speaking an active duty service member who retires gets 50% of basic pay. A Reservist who retires after 20 yrs, must wait until age 60 to draw a retirement. The reservist retirement is calculated based on point which equate to "active duty days", so a typical reservist may retire with say 5 yrs of equivalent "active duty days". His pension would equal 12.5% of the base pay for his rank at the time of retirement...Simple answer, more details to how the reserve pay is calculated. COLA and high 3 yrs of pay etc play a role as well now.

While the reservist has to wait until age 60, he does benefit because his retirement pay is calculated based on the current pay tables. Many reservists will also have some active duty years as well so the percentage of retirement pay will vary. Each yr of active duty service is worth 2.5% of base pay for the pension.
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Old 10-23-2010, 09:00 PM   #24
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I have a survivor annuity from the government . It is fully cola . My retirement benefits on my work history are in an IRA .
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Old 10-23-2010, 09:35 PM   #25
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I am not him, but it appears that what he is describing is similar to simple interest. Say he retired at year end 2010, and will receive $50,000 for 2011. In 2012 that would bump up to $50,000 + 4%* $50,000, or $52,000. However, each year thereafter he would continue to get "only " an additional $2000, so that his total pension would increase arithmetically rather than exponentially. Thus in 2013 he gets $54,000, in 2014 $56,000, etc. This ignores the extra bump somewhere along the way that he mentioned in his description.

Ha
This is almost correct. On the day that I retire they calculate my pension amount. If it the amount is $50,000, then I get an immediate 4% bump so in the first year I get $52,000. The COLA increase continues to be an additional $2000 every year.
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Old 10-23-2010, 10:53 PM   #26
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This is almost correct. On the day that I retire they calculate my pension amount. If it the amount is $50,000, then I get an immediate 4% bump so in the first year I get $52,000. The COLA increase continues to be an additional $2000 every year.
I'm still confused. When I retire, they will calculate my pension, and that's how much it is. Why isn't this just called a starting pension benefit of $52,000? Is it so your annual increase in later years is $2000, not $2080 (4% of $52K)?
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Old 10-24-2010, 01:38 AM   #27
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Quote:
Originally Posted by Amethyst View Post
Still wondering (since my question on another thread got derailed),is a military reserve pension the same as a regular military pension for same rank at retirement?
A.
In addition to MartyB's excellent post #21, see:
The Value of a CSRS Pension
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Old 10-24-2010, 07:54 AM   #28
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I'm still confused. When I retire, they will calculate my pension, and that's how much it is. Why isn't this just called a starting pension benefit of $52,000? Is it so your annual increase in later years is $2000, not $2080 (4% of $52K)?
I get the annual increase of 4% of the original pension amount....but instead of waiting a year to get my first increase, I get it on day 1. I dont know why that is.
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Old 10-24-2010, 11:03 AM   #29
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DH's pension (state of Ohio) is COLAed 3% based on the original amount. Every year the amount is the same, no compounding.
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