For military personnel and their spouses, not only do they have the day-to-day fears that come with the job, they also have the added challenge that if the military member does not stay in the military for 20 years, they receive no retirement benefits. Further, if the married couple was not married for 10 of those 20 years of service, Defense Finance and Accounting Services (DFAS) will NOT provide the non-military spouse with a direct payment of the military member’s retirement if there is a divorce, leaving the non-military spouse to try and collect the marital share of the military spouse’s retirement directly from the military member. This can become extremely difficult, especially if the couple divorces several years before the military member retires and non-military spouse does not know where the military member lives.
However, a positive change for the military spouse will begin in 2018: newly enlisted troops will no longer have the traditional 20-year, all-or-nothing retirement plan. Under the changes, it will be a blended pension and investment system featuring automatic contributions to troops’ Thrift Savings Plans and an opportunity for government matches to personal contributions.
The new system is expected to give roughly 4 in 5 service members some sort of retirement benefit when they leave the military, as opposed to the current system which benefits only 1 in 5.
What is unclear is whether or not the new system changes allows the non-military spouse to collect their share of the military member’s retirement benefits via a divorce directly from DFAS without having to be married for 10 years. This is an important area that I will continue to follow closely.