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Save your pension: If the drawdown gets worse, Marines still have several paths to retirement

Aug. 26, 2013 - 06:00AM   |  
Marine attack helicopters blast their way into Exe
Staff Sgt. Corey Butts, a Huey crew chief, fires his .50-caliber machine gun during an exercise in June. As the Corps considers altering its policy of allowing non-promotable staff sergeants to remain in uniform through 20 years, career-minded enlisted Marines may want to explore other options to enhance their chances of locking in at least some retirement benefits. (Cpl. Glen Santy / Marine Corps)
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Up or out limits

Enlisted Career Force Controls regulate how long Marines at a particular rank can remain in uniform. If they are not promoted before they reach that limit, they are pushed out of the service. In 2011, the sergeant up-or-out limit was reduced from 13 years to 10. Staff sergeants, who are now allowed to serve through 20 years, could see their limit reduced, too, as manpower officials aim to to hit the drawdown goal of 182,100 Marines by 2017 — and as the threat of deeper cuts, which could take the Corps as low as 150,000 — looms. THE ECFC limits, by rank:
Corporal: 8 years
Sergeant: 10
Staff sergeant: 20
Gunnery sergeant: 22
First sergeant/master sergeant: 27
Sergeant major/master gunnery sergeant: 30
Now Eligible for TERA
Marines in the following ranks and military occupational specialties, who have served between 15 and 20 years, will be eligible for the Temporary Early Retirement Authority program in fiscal year 2014, which begins Oct. 1, according to Marine administrative message 407/13, signed Aug. 16. Staff sergeants in 19 MOSs and gunnery sergeants in five MOSs will be eligible for the incentive, which provides Marines with an early retirement at a reduced pension rate.
Staff sergeants:
0369: Infantry unit leader
0481: Landing support specialist
0619: Wire chief
0629: Radio chief
1361: Engineer assistant
2146: Main battle tank repairer/technician
2311: Ammunition technician
2862: Electronics maintenance technician
5524: Musician
6074: Cryogenics equipment operator
6112: Helicopter mechanic, CH-46
6122: Helicopter power plants mechanic, T-58
6152: Helicopter airframe mechanic, CH-46
6172: Helicopter crew chief, CH-46
6174: Helicopter crew chief, UH-1
6212: Fixed-wing aircraft mechanic, AV-8/TAV-8
6252: Fixed-wing aircraft airframe mechanic, AV-8/TAV-8
6322: Aircraft communications/navigation/electrical systems technician, CH-46
6469: Advanced automatic test equipment technician, IMA
Gunnery sergeants:
0161: Postal clerk
6112: Helicopter mechanic, CH-46
6152: Helicopter airframe mechanic, CH-46
6172: Helicopter crew chief, CH-46
6322: Aircraft communications/navigation/electrical systems technician, CH-46

Is this the calm before the storm?

Is this the calm before the storm?

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Is this the calm before the storm?

For career-minded enlisted Marines, that’s a fair question to ponder as officials continue to hint that, despite their best intentions heading into the Corps’ manpower drawdown, soon all bets may be off.

The most recent warning emerged in mid-August, when Marine officials addressed their decision to rescind a longstanding policy allowing nonpromotable majors and prior-enlisted captains to stay in uniform through 20 years, time enough to secure a full military retirement. On the enlisted side, Marines who make staff sergeant still enjoy that 20-year assurance — for now. But that, too, could change, officials said. It depends how many Marines volunteer to leave.

That decision could be swayed as wellby the long-term across-the-board budget cuts known as sequestration, which threaten to derail the Corps’ methodical plan to eliminate roughly 5,000 positions a year as it downsizes the active-duty force to 182,100. As Defense Secretary Chuck Hagel acknowledged, sequestration could leave the Corps as small as 150,000. And despite warnings that $52 billion in sequestration-related cuts could have grave effects on national security starting next year, there’s been little movement in Congress to find a solution.

So where does this leave you? Another fair question.

Gunnery Sgt. James Waldvogel, a career planner at Camp Pendleton, Calif., indicated that because no official guidance has been released, it’s tough to answer the what-if questions Marines may have. For now, the best guidance he has is to focus on the fundamentals — things like making sure you’ve completed a B-billet, performed well on your fitness tests and completed required professional military education.

But for those who face the threat of not making 20, especially those in overpopulated military occupational specialties, now is a good time to contemplate other optionsthat may enhance your chances of locking in at least some retirement benefits. What you need to know:

Understand what’s changing on the officer side. The 20-year guarantee for majors and staff sergeants was central to the commandant’s desire to “keep faith” with Marines and their families, many of whom have endured the strain of multiple combat deployments during the last 12 years of war. “It’s a loyalty thing,” Gen. Jim Amos has said.

Signed Aug. 13, Marine administrative message 401/13 pertains only to noncompetitive majors and prior-enlisted captains, but manpower officials have acknowledged that “we are considering altering the policy of allowing twice-passed staff sergeants to remain on active duty until reaching 20 years.” As such, the MARADMIN offers some insight for enlisted Marines, too.

For staff sergeants, enlisted career force controls were set at 20 years as a matter of common practice. On the other hand, majors who failed selection to the next highest rank have gone before formal continuation boards that each year screened and continued everyone they reviewed. Now, those boards are likely to push out some.

Some officers who are asked to leave will be eligible for “sanctuary” if they have served at least 18 years in uniform within seven months of the continuation board’s determination. That means they will be allowed to serve through 20 years.

The others can request early retirement via the Temporary Early Retirement Authority, which allows Marines to retain their pension at a reduced rate provided they meet certain criteria. TERA is a force-shaping tool used to entice select personnel to leave the service ahead of schedule. Congress approved its use before the drawdown began. Because nearly every Marine officer not offered continuation will have already served 15 years or more, they should be eligible for TERA with very few exceptions, Marine officials have said.

Consider early retirement carefully. Marine officials have voiced their desire to treat officers and enlisted Marines equitably. So if recent changes to officer retention practices are any indication, enlisted Marines with the requisite time in service should have a shot at applying for TERA if they’re denied further service.

That said, all Marines considering TERA should be mindful of the reduced pension rate as they weigh whether it is the right choice for them. For example, a staff sergeant with 15 years of service would receive about $15,000 each year compared to about $24,000 per year if he stayed through 20, Waldvogel said. Over the remaining years of his life, that could easily surpass $100,000 in lost income.

For a staff sergeant with a DUI on his record, TERA may seem appealing if he can’t get promoted to gunnery sergeant. But there are other factors to consider, Waldvogel said, including education level and job opportunities in the civilian sector.

If that staff sergeant has no college education, it wouldn’t make sense to leave the service for a civilian job that pays $40,000 when the military is compensating him upwards of $70,000 between base pay and assorted allowances. On the other hand, a Marine with college education or a solid plan to start his own business may be able to turn an early retirement into a profitable venture with a second civilian career.

So far this year, 240 enlisted Marines have taken the early retirement incentive.

Corporals, sergeants can consider lateral moves. Career-minded Marines can increase upward mobility by moving out of overcrowded MOSs and into those that are undermanned and in demand. For some sergeants, this may offer a fast track to make staff sergeant — and with that the opportunity to reach at least 15 years in uniform and the option for early retirement benefits via TERA.

Any Marine, regardless of MOS or tenure, is eligible to apply for a lateral move, but it is most advisable for junior Marines and sergeants. By moving into a high-demand, low-density field like intelligence, where promotions come quickly, young Marines can positively alter the entire trajectory of their career and obtain job security, Waldvogel said. “Lateral moves are a big part of it right now,” he said. “If you want to further your career, get into one of those in-demand MOSs. Despite the drawdown, the Marine Corps is hurting for bodies.”

If a corporal goes into the 0211 counter intelligence/human intelligence specialty, for example, he is more likely to have a long career. He will get a bonus and the time to pick up sergeant and then staff sergeant will be fast — much quicker than the infantry, for example, which Waldvogel said is getting cut to the bone during the drawdown.

Those wanting to make a move in fiscal 2014 should think about it now and submit their applications as soon as possible. While lateral moves don’t open until Dec. 1,officials may grant early moves in some cases.

Staff sergeants can go warrant officer. For those who have already been a staff sergeant for several years, a lateral move may be a bad idea, Waldvogel said. By that point in their career, they are already highly specialized in a particular MOS and a move into another job would be starting all over again. For staff sergeants with a strong record of performance, the better option may be to go warrant officer, he said. Warrants earn significantly higher pay, and because they serve as the Corps’ technical experts in a specific MOS, they enjoy a high degree of job security that could take them well past 20 years of service.

Each year a few hundred make the jump to warrant officer.

Explore opportunities in the Reserve. Another option to remain in uniform and work toward a retirement pension is to transfer to the Marine Corps Reserve. Reserve retirement doesn’t begin paying out typically until a Marine reaches age 60, but it still provides a steady source of income later in life.

In the short term, transferring to the Reserve can come with a slew of incentives, including affiliation bonuses to fill shortfalls at particular ranks or in particular units. Depending on one’s rank, MOS and unit, some Marines can take home between $10,000 and $20,000 to fill specific billets.

The Reserve also has the Direct Affiliation program, which guarantees Marines a billet within a specific unit months before they leave active duty. It also allows them a six-month extension of TriCare benefits, free of charge.

Marines joining under the Direct Affiliation program must be highly competitive for promotion and thus would likely be able to work toward a full retirement, which in the Reserve is based on a point system.

Last year, 225 Marines took advantage of the program.

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