If you’re getting a divorce from someone who is in the military, it might be in your best interests to wait until 2018. While you might want to get your divorce over with as soon as possible, the new retirement system being implemented could throw your settlement off in the future. It’s best to find a way to include it in your settlement at all costs.
The military has developed a new retirement system called the blended retirement system, or BRS. This new system goes into effect in January 2018. The changes that come with the new plan include matching Thrift Savings Plan contributions, mid-career incentives and reduced traditional military pensions for those who have served at least 20 years.
Those in the military who have been working for fewer than 12 years have the option to join this new system or to be grandfathered into the old retirement system. If your spouse chooses to opt in, there is no requirement for him or her to give you notice.
While this new system may be good news for the future retirement of some veterans and military personnel, it makes divorces more complicated. Those who divorce by the end of 2017 may be awarded a portion of the person’s retirement based on an old system, and that could complicate matters later in life. There is even a potential for the mid-career bonus to impact spousal or child support payments, which won’t be addressed in any current divorce settlements.
Your attorney can talk to you more about the potential for the BRS to impact your settlement. There may be steps you can take to protect your future retirement benefits.
Source: Ameriforce, “BRS and Military Divorce,” Andrea Downing, Oct. 11, 2017