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Would a Federal retirement buyout program be feasible?

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posted on Aug, 6 2011 @ 09:45 AM
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I consider myself to be a financial retard. Knowing this weakness, I only buy what I can afford with cash and have not had a credit card since the eighties. I save for my wants and spend on my needs and it can be very hard at times.

But I ask those financial whizzes here a question.

Would it be feasible or fiscally responsible to offer all Federal and Military retirees a onetime buyout? Say a 1/4 to a 1/3 third onetime payment of what you would receive over twenty years. Possibly even tax free as once they have that money it will go into IRA’s savings account and other purchases.

A retired E-7 makes roughly $2,784.28 a month pre-tax after 26 years in the service.

Over the course of twenty years this will add up to a cumulative; $1,043,623.81 pretax. This is also assuming the tax rate stays at 28%, With a GDP growth of 3.5% and inflation at 3.5%. The website I get this from is here.

militarypay.defense.gov...

Make it totally voluntary and you would not lose the other benefits earned. But the check just will no longer be there every month.

I know that other companies have done this and saved money in the long run. I also realize that it would be hard on the government in the short run to do this.

I would totally take a buy out as then instead of slowly saving to start my business, I could do so immediately.

Is this feasible?

edit on 6-8-2011 by TDawgRex because: Still on my first cup of joe.




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