Oh sorry I thought there was. Please tell me how military pensions are funded and calculated. Do soldiers pay a portion of their salary into a DC plan?
Service personnel do have a defined contribution plan available to them. That plan (the TSP) can, by law, be funded in part by employer contributions, but the military services have decided not to do that. There might be a few exceptions for certain hard-to-fill specialties (Explosive ordnance disposal, combat infantry, etc) but in general service personnel get ZERO matching for any contributions to this plan. How does that compare to civilian employers?
Yes, there is a defined benefit plan, and it is part of the individual's total compensation. A servicemember becomes vested in this program after 20 years. Not a minute earlier (barring service-connected injury or very rare special inducements to get numbers down). If the person has been in for 19 years but doesn't want to go back to Afghanistan, doesn't want to be separated from his family one more time to go to sea or go on a remote tour, then that person
may be able to quit the service (depending on his/her enlistment status, etc,) but he/she will get zero retirement. Go to bed with a superior or a subordinate--maybe go to jail and also lose your retirement. Got a DUI? Say something bad about the President to the newspaper? Get fired and get zero retirement. To receive his "retirement" check, an officer must agree to be available for future callup (if a person has to agree to additional service, is it truly a "retirement"?). And the amount of that check is not based on the individual's final compensation. The compensation of a servicemember is comprised of several portions, and only the "base pay" is used in computing retirement pay. This is typically about 60 percent of what the person was earning. The "retirement" pay percentage of this "base pay" is based on years of service. And it is not the final "base pay" that counts, but the average base pay for the previous 3 years, which may be a lot less.
I'm not saying it is a good deal or it is a bad deal. I will not get into the whole issue of what an individual must do, and must be
prepared to do, in order to earn this retirement. There are two things worth mentioning:
1) This deal, or one like it, is available to most Americans and resident aliens of good character and physical condition. There's no need to know somebody special, have a friend in the business, etc.
2) Whether we are talking about soldiers, truck drivers, or teachers, there's a big difference between a) breaking a promise to those who have already put in years of service and b) changing the rules for those who are now accumulating "points" in the system and are therefore free to take their talent and time elsewhere.