So, What is This Reduced Retirement Age Thing Anyway? – Part 1

Now here is a topic that has caused a lot of confusion over the last several years.  Since the 1940s, reservists have had to wait until age sixty before they could receive their pensions.  Now there is an exception to that rule.  Please pay careful attention to what I’m about to say because there are a lot of rules to this exception.  Due to there being so much information about this change, this will be a longer article than usual.  I’ll try to make it as simple as I can.

 

In January of 2008, the law changed to allow certain reservists to receive their retired pay earlier than sixty.  This law was meant to recognize the increased importance of the reserve components in conducting, as it’s called, the Global War on Terrorism. This change went into effect on 29 January 2008.  Probably due to the cost involved, the change was not retroactive to 11 September 2001.

 

Here is a brief idea of how the reduced retirement age law works.  There are certain types of active duty service which qualify for this reduction.  For each ninety-day period served in a fiscal year under these types of active duty, a reservist will be allowed to receive retired pay three months earlier than sixty.

 

Did you notice all of the provisos in that last statement?  Yes, it’s a bit tricky.  The ninety-day blocks have to be within a fiscal year.  The federal fiscal year runs from 1 October of one year to 30 September of the next year.  This fiscal year rule means, for example, if a reservist has served eighty-nine days of active duty and then the ninetieth day is 1 October then that entire block of time (the eighty-nine days) will not count for reduced retirement age eligibility.  This means, in short, that a year of active duty service will not necessarily equal a year of reduction in the reservist’s retirement age.  This has disgruntled quite a few reservists.  More on that later.

 

Here is an example of what I said before.  Sergeant Matthews is mobilized to serve as part of Operation Enduring Freedom on 3 August 2009.  He serves active duty for a total of 390 days or until 27 August 2010.  3 August 2009 to 30 September 2009 equals 89 days.  This period of time will not qualify for reduced retirement because the next day, his ninetieth day, is the start of the new fiscal year.  His service for determining reduced retirement age eligibility will restart on 1 October.

 

From 1 October 2009 to the day he is released from active duty, 27 August 2010, he serves an additional 331 days.  If you divide the 331 days by 90, there are three full ninety-day blocks within this time frame (or 270 days).  As a result, Sergeant Matthews is eligible to receive retired pay nine months earlier than sixty.

 

That’s difficult enough to understand, but it does get easier for those who have served under one of those qualifying types of active duty later on.  On 1 October 2014, the law changed again to allow qualifying active duty to cross over fiscal years.  This means shorter periods of service in one fiscal year will not be discounted simply because 1 October has arrived.  Again, this change in the law was not retroactive.

 

Let’s take Sergeant Matthews’s example again and just change the dates.  SGT Matthews is mobilized on 3 August 2015 and serves until 27 August 2016.  This is a total of 391 days of active duty.  There is no limitation based on his service crossing two fiscal years.  Divide 391 by 90 and you see that he has four full ninety-day periods and, as a result, can now receive retired pay one full year earlier.

 

I hope that makes sense so far.  Let’s dive a little deeper in Part 2.

 

Until next time, thanks for joining me today and, of course, thank you for your service.

 

D.J.

 

References:
National Defense Authorization Act (NDAA) for Fiscal Year 2008, Section 647 – effective 28 January 2008
National Defense Authorization Act (NDAA) for Fiscal Year 2014 –  effective 19 December 2013
10 USC § 101(a)(13)(B)
10 USC § 1074(b)
10 USC § 12301(a)
10 USC § 12301(d)
10 USC § 12302
10 USC § 12304
10 USC § 12304(a)
10 USC §12305
10 USC § 12406, chapter 15
10 USC § 12301(h)
10 USC § 12731(f)(2)
32 USC § 115
32 USC § 502(f)
Department of Defense Instruction 1215.07 (with Change 1) – 23 September 2013
Army Regulation 135-180 – Qualifying Service for Retired Pay
Army Regulation 600-8-7 – Retirement Services Program – 18 January 2017
National Guard Regulation 680-2 – Automated Retirement Points Accounting Management – 19 August 2011
Personnel Policy Operational Memo 13-029 – Implementation Guidance for Reduced Retirement Age for Army National Guard Soldiers – 05 August 2013
Tricare.mil

Related YouTube Episodes:
The Basics of Reserve Retirement

Related Articles:
So, What is This Reduced Retirement Age Thing Anyway? – Part 2
Types of Qualifying Active Duty for Reduced Retirement Age

2 thoughts on “So, What is This Reduced Retirement Age Thing Anyway? – Part 1

  1. For accuracy and clarity, please review the fourth paragraph and substitute “1 October” for “1 September” and substitute “ninetieth” for “next”.
    It should read, “This fiscal year rule means, for example, if a reservist has served eighty-nine days of active duty and then the ninetieth day is 1 October then that entire block of time (the eighty-nine days) will not count for reduced retirement age eligibility.”
    Thank you for the excellent information on a subject so poorly understood.


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