Would you take out a lifetime mortgage on your retired pay with an APR of 35%? What about 24%?
That's pretty much the deal the services now present to officers and enlisted members, respectively, at the 15-year point in their careers. They're offered a $30,000 taxable "bonus" if they agree to accept dramatically reduced retired pay for life. In essence, they're asked to trade $300K-$600K of retired pay to get $23,000 after taxes up front. And many troops are doing it.
Seems like a short term solution to a long term problem, but every service member that is affected by this should make an informed decision if this is offered.
MOAA: Military Officers Association of AmericaAs I See It — REDUX “Career Status Bonus” — A $30,000 Scandal
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