A Word from the Publisher

This post is the first of a two-parter from longtime friend of the blog Chris Pascale. Chris was a US Marine who served in Iraq in the mid-2000s but is now a US federal employee. If you want to know more about him, you can read his short bio at the end of the blog post.

Chris writes here in a private capacity, which is good because he has several strong but fact-based opinions on which pathway (federal or military) provides the better retirement benefits value proposition from a “worth vs. worth it“ perspective. I emphasize the term pathway because judging the worthiness of a pensionable career should be more than just an examination of the retirement benefits provided. It should also consider the pros and cons one will experience while working towards those benefits during their career, which is what Chris does.

In that light, Chris clearly believes the federal path is the better one. That’s a critical view to represent since I spend so much time on this blog talking about the advantages of my military retirement benefits. That isn’t to say that Chris doesn’t support those making a career in the military; he simply believes the career and retirement benefits should be more equitable. The remainder of this article and the next explain why. Take it away, Chris!

Fed vs. Military: Which One is Worth It?

Author’s Note: The first draft of this article was even longer and very much all over the place. To call it a mess would be insulting to messes and other disasters. At best, I came off as a lunatic who honestly thought I’d created a thoughtful and coherent piece of scholarship, but the kindness of a friend named Grumpus saved me.

If you’re in the military or federal workforce, you can invest in a 401(k)- type plan called the Thrift Savings Plan (TSP). Troops get a match after serving 24 months, and federal employees get it on day one. The lesser match is one topic I cover in this article about whether joining the military is worth it compared to serving in the federal civilian workforce.

The rest of the article compares the benefits and lifestyle of serving in the US military versus working a federal civilian job. There are some areas where the military outdoes the fed, but the fed generally outdoes the military by so much that it appears troops are being discriminated against. This discrimination may warrant legislative reform, and I recommend you contact your Congressman, as I have.

Comparisons in this article include the following:

Retirement savings match	Feds win
Calculation of retirement	Some feds win
Living situation	Situationally dependent
Worker protections	Feds win
Workplace safety	Feds win
Holiday & vacation	Feds win
Backend benefits	Military wins
Freedom during off-hours	Feds win

For anything left out or that you disagree with, please comment at the end. It will likely help someone.

Retirement Savings Match

Military Anecdote: TSP was available during my basic training, and I had the opportunity to invest in it. There was no match back then, so I opted to invest on my own, for which I have nothing to show except a story about how I bought some Netflix shares in 2004 and then sold them a week later for no good reason. Had I been regularly investing in the TSP; I’d be sitting on compounded growth since May 2003.

Fed Anecdote: On my first day at the IRS in 2011, I signed up to put 5% of my pay into the TSP. My money doubled the moment I invested because it was matched. This year, I’ll put in $500 per paycheck, and the government will add about $285, so I’m getting another 57% before the market goes up or down.

Feds get a match up to 5% of their income starting with their first paycheck, while service members have to wait two years. As a result, new Marines assigned as White House guards do not get a match on TSP contributions. However, a rookie Secret Service agent does, as does the janitor, kitchen staff, members of Congress, and everyone else with a civilian federal job.

Mind you, the Marine who just graduated from the School of Infantry earns about $2,262 a month, while the lowest-paid federal worker makes $2,848 ($17.20 per hour). A deployed Marine lives away from home while making less in almost all cases; the federal employee gets paid more while being able to see their family every night.

Note that federal employees must be in the system for two years to vest, but when they do, they’ll have the money in their accounts, whereas those on active duty won’t. Denying our troops the match places a needless burden on them beyond the reforms made to their retirement offerings over the past seven years (covered in detail later).

POINT 1

A private first class (the 2^nd lowest military rank) who makes less than any federal employee won’t get a match on his TSP contributions for two years, while all federal employees get it upon starting.

Calculation of Retirement Benefits

Military Anecdote: Grumpus retired in 2019 after 20 years of service with 50% of his base pay while still a young man with a young family. Since 2018, newer servicemen and women will retire after 20 years with 40% of their base pay. A downside for Grumpus was that before 2018, he could not get a match on his TSP, so today’s servicemembers can leave the service before 20 years with their matched TSP, which is pretty darn good, as Grumpus discussed here during his 2021 graduate school research.

Fed Anecdote: While getting a 5% match on my TSP in 2011, I experienced three furloughs while the Marine Corps called me in 2009 and sent me a letter in 2011 asking that I come back at my old rank and time-in-grade, despite being 60% disabled. The Marines, who apparently needed me, would not match my TSP contributions. However, the Treasury Department, who apparently did not want me, did match.

An Economic Argument?

A 2015 Wall Street Journal article pondered the question, “Are military benefits too rich?” and cited two economists from the Pension Policy Center in Washington. They suggested raising the military pension age based on several factors, including a hypothetical 17-year-old retiring at 37 with half-pay for life.

Regarding whether military benefits are too rich, that jack-wagon-of-a-question is obsolete because shortly after those policy wonks took that shot at minors in the armed forces, including some who may have fought in Iraq or Afghanistan at 17 years old, the Department of Defense (DOD) fiddled with their abacuses to adjust the 20-year pension, cutting the annuity by a fifth based on the idea that troops will get the TSP match.

I don’t want to go into why some economists deserve wedgies because the previously noted article about how good a 17-year-old boot camp recruit has says it all. Statistically, every basic training platoon has 1-2 minors in its ranks. My interaction with a 16-year-old marine I briefly served with brought me to learn that he’d been an orphan that someone never adopted, and was hoping to marry his 15-year-old girlfriend soon. This episode led me to wonder how many orphans and foster kids join the military in order to have a home, leading me to this LA Times article stating that the military “has been disproportionately recruited from people from single-parent households or the foster care system.”

They enter the military closer to the age of 15 than 20. Some have no one to list on their life insurance forms, meaning no one cares if they live or die or if their benefits get cut. While that child goes to bed experiencing loneliness like most of us never will, fancy economists ask fundamental questions like if his benefits are “too rich.”

Let’s Get to Some Numbers

Department	20-year percentage of income in retirement	30-year percentage of income in retirement
Military	Immediate 40% (formerly 50%)	Immediate 60% (formerly 75%)
Fed law enforcement	34%, min age to receive pension: 50 Cannot join after age 37 with leeway for prior military service	Immediate 51% Cannot serve after age 57 with leeway for prior military service
Fed worker	20%, deferred until age 60 No age restrictions for joining; pensions are available as soon as five years of service after age 60	33%, min age to receive pension: 57 No age restriction for remaining

If a servicemember gets married, they receive an allowance (it’s literally called an allowance) for housing based on the zip code where they’re stationed. As a sergeant in 2008, I took home about $3,000 a month, which included roughly $800 for housing and another $200 for meals at the dining hall. Allowances are not taxable or calculated into one’s pension. Legally untaxed money is great until it’s time to retire from the military or claim Social Security Income (SSI), and you realize none of that extra value contributes to the calculations.

More Numbers

I pulled the following comparisons from the 2023 DFAS pay chart and 2023 OPM tables. I initially calculated fed pay using the OPM LEO calculator, but it did not include LEAP pay, which is an additional 25%, so I manually added it. The pay rates are for retired E-7 (senior enlisted), O-4 (mid-grade officer), GS-13 federal agent, and a federal worker maxing out the pay grades of GS-07, GS-11, and GS-13.

Pay Grade	High-3*	20 years pension	30 years pension	40 years pension
E-7	$5,500	$2,200	N/A**	N/A
O-4	$9,200	$3,700	N/A	N/A
Federal Agent, Washington, DC	$15,100***	$5,100	$7,700	N/A****
Federal Agent, Kansas City, MO	$12,900	$4,800	$6,600	N/A
GS-07, step 10, DC	$5,750	$1,150	$1,900	$2,530
GS-11, step 10, DC	$8,500	$1,700	$2,800	$3,740
GS-13, step 10, DC	$13,530	$2,710	$4,470	$5,950
GS-07, step 10, MO	$5,130	$1,030	$1,690	$2,260
GS-11, step 10, MO	$7,590	$1,520	$2,500	$3,340
GS-13, step 10, MO	$10,820	$2,160	$3,570	$4,760

* Salaries and the high-3 are rounded.

** Military members at these ranks do not qualify to continue their service for 30 years due to mandated term limits that lead to forced retirement.

*** Federal pay rates vary across the country, so I compared Washington, DC, and Kansas City, MO. All salaries reflect maxed-out pay grades, meaning that the GS-07 is at step 10, as are the other pay grades.

**** Federal agents, with exceptions for past military service, cannot work beyond age 57, nor can they begin the job after the age of 37.

Brief Benefits Analysis

Military members: In the Marine Corps, you must reach the rank of sergeant at eight years, and staff sergeant at 12, or the Corps kicks you out. Furthermore, if you make it no further than staff sergeant as enlisted or captain as an officer, you are forced into retirement after 20 years.

Military pensions begin immediately (even at age 37), which, as retired submarine officer Doug Nordman told Forbes in 2019, was his most significant benefit from 20 years in the Navy. Had he, his wife, or his daughter suffered severe medical issues, he might have stated it was the medical benefits. I can attest to that as the spouse of a retiree who pays only $520 a year for our whole family. The coverage is also excellent.

Federal agents have the highest salaries and pensions, but their work hours are limited. That’s a downside. However, an upside is that their skills may transfer to the education and private sectors, especially for those with a background in counterfeiting or fraud.

Federal employees can retire at 20 years, but pensions are small and untouchable until age 60. Let’s take that same 17-year-old who joined the military and put him in the IRS or a VA hospital instead. His income at any pay grade will be higher than if he enlisted, but unless he already has a place to live, it may be impossible to find one since federal employees don’t receive a housing allowance. In general, though, federal salaries are better than those of the military.

These factors lead to questions about how people live, but before touching on that, a massive plus for federal workers is that they can join at any age, and those who join at age 55+ can retire with a pension after just five years.

POINT 2

Military pensions offer incredible value because they pay out immediately upon retirement. However, that pension payment will be low, partly because calculations use the reduced base pay, which does not include allowances or special pay. It’s easier to earn a federal civilian pension, though, than a military one. For instance, the minimum cliff vesting period for a Fed can be as short as five years compared to 20 for the military. That said, unlike military pensions, federal civilian pensions come with age restrictions governing when the pension can begin.

Living Situations

Military Anecdote: While at Camp Lejeune, I lived in new base housing in the Tarawa Terrace II neighborhood from 2005 to 2007. It was very nice. Other base housing was much smaller and had lead paint. When we moved to Louisiana, we purchased a home and were glad we did because there seemed to be a very high rate of health issues for people we knew living on base. The rumor was that it was from Chinese drywall in the new homes, but I could not locate any information on that. What I did find was an article noting unsafe base housing as a national problem, and Fort Polk, Louisiana’s housing is the first photo. Overall, while there are some excellent base housing units around the US and overseas, but many have proven disastrous due to poisonous water, mold, and shoddy construction.

Along with this uncertainty of whether a home is safe or not, there’s a lot of moving in the military. Following basic training, I had temporary orders to Biloxi, Mississippi, then Jacksonville, North Carolina, and then went to my permanent duty station in Jacksonville. After I left the military, my wife went to Oklahoma, then New Mexico, before going to her permanent duty station in Louisiana. Neither of us are from any of these places, so we did without steady family support while not being able to grow the kind of wealth one does when building equity in a home over 13.2 years, as the average US homeowner does.

Fed Anecdote: Despite there being 15,000 federal workers on Long Island – about 3,000 of whom work just a couple miles from my home – it’s far from being the one-company-town that a military community often is. I rarely run into someone from work, and it’s lovely. What’s also nice is that since this is not a military-dominated community like Jacksonville with a gigantic military installation, there are a lot fewer tattoo parlors, strip clubs, and other questionable establishments. Along with those not being within everyday view for my four daughters, I also don’t have to endure everyday talk about those establishments at work.

As noted, military professionals typically move at least a few times. In contrast, federal agents and workers can remain in one location. When I first entered federal service in 2011, it was as a GS-05. The pay was about equal to being a sergeant, but the level of responsibility was that of a recruit. The hours were set and simple, and anything over those hours was overtime that I had to volunteer to do formally. Most federal workers can easily guide their careers to remain in the same place of duty for 40+ years or move to where the next opportunity is. Additionally, with telework, some who prefer rural living are taking advantage of a rule that permits them to live as far as 200 miles from their place of duty.

POINT 3

Federal workers have much more flexibility in their living situations and can choose never to move. For some in the military, the stability of always having housing is a major draw, but this benefit can have significant drawbacks.

Family Life

Military work hours can be extremely long for no good reason. Sometimes training takes place over several days and nights. There are no monetary or time-off benefits related to these long hours. Alternatively, by law, most federal jobs cannot dictate an employee’s work beyond their tour of duty. In fact, when the 2018 government shutdown happened, non-essential employees rushed to tie up any work, but if they didn’t leave on time, management kindly escorted them out.

Military Anecdote: When I was in Iraq, my squad leader received a Red Cross message and was sent home for the birth of his child. His wife had placenta previa and needed a C-section. For those who don’t know, after a C-section, the mom is not able to drive for at least two weeks. A few months later, I received a Red Cross message. My wife had the same issue, but my request was denied.

As she was preparing for surgery, I was on a mission with a special forces unit called Marine Recon, and we were on the receiving end of a mortar attack. Following surgery, the doctor thought my wife might die. Shortly after, I was on another mission where we took gunfire.

By the way, my personal presence on these missions wasn’t the driving factor in my leadership’s decision not to let me go. I was there as a replacement for another Marine in my platoon who received a Red Cross message and traveled home after his brother (who was not his dependent) sustained a spinal injury. Thus, philosophically, they could’ve sent me home for familial reasons, and practically, I was not the last remaining person with my skillset to backfill the vacancy. In fact, engineers in my platoon were rotating into this role on a regular schedule, and when my 60 days were up, I was rotated out.

Federal Anecdote: Upon meeting my manager while in training for my GS-05 federal job in March 2011, I let her know that I’d be taking unpaid leave in May for the birth of my fourth daughter. It was not a problem in the slightest, and when I extended my time away due to an unplanned C-section, there was no pushback. Had there been, I would have stayed with my wife anyway. To do this in the military would have been to risk being locked up in a military prison and losing all the benefits that come with service.

POINT 4

While many employers want you to put them ahead of your family, the military can force you to.

To be continued in Part 2 …