WASHINGTON — With the new federal budget passed Wednesday, members of the military will see a major cut to their retirement benefits.
The deal reduces the cost-of-living adjustment for military retirees. They will lose 1 percent of their pension every year until they turn 62-years-old.
Estimates show a retiree who joined the military in his or her twenties and retired in his or her forties could lose more than $100,000 over 20 years until they turn 62.
On the other hand, the adjustment will save the government $6 billion.
Military groups across the country say the cutback targets veterans and financially harms those who risked their lives for our country.
FOX8 spoke to Scott Matthews of Greensboro, who considers the provision a breach of faith.
Matthews retired in 2008 as a Lieutenant Colonel in the Marine Corp after serving active and reserve duty for 30 years.
“We all knew what the benefits were when we started working,” he explained. “We knew what the retirement was so we could do our proper planning just like anybody else working for a company and gets involved with a 401K or some other pension plan.”
He added, “I’m definitely one that’s going to be affected. I’m not 60 yet and as a reservist, a retired reservist, we receive our pension at the age of 60.”
Under the new budget, Matthews would lose pension money for two years. But he knows other veterans who will lose much more.
“It is a breach of faith in terms of what our expectations were in the beginning,” Matthews continued. “If you have to cut, make it across the board. In other words — everybody gets the same pain.”
Senator Kay Hagan responded to FOX8’s request for comment today by saying in an email, “I am opposed to the provision in the budget agreement that reduces COLA for military retirees and will be looking at legislative solutions to restore those cuts for the men and women who have served our country with honor and distinction.”
Hagan continued, “No bill is perfect, and I made the decision to vote for this bipartisan budget after hearing from military leaders in North Carolina, who urged me to support the agreement because they are concerned about the effect of sequestration on military readiness and the safety of our troops.”
Matthews concluded, “We’re definitely going to feel it if this goes through.”