Retired Navy Benefits

The U.S. Navy has been an all-volunteer service for almost all of its history. In order to attract and retain a pool of talented, veteran sailors and officers, there needs to be competitive compensation--retirement benefits are an important part of the overall compensation package. Individuals can join the Navy at 18, serve 20 or 25 years, and retire just barely middle-aged with full access to retirement benefits and the support to embark on a second career.

Pension Scheme

Sailors and officers are encouraged to join the Thrift Savings Plan, which is a federally-sponsored 401(k)-style retirement plan. Like some civilian 401(k)s, the Navy matches contributions to the plan, with taxes on contributions and accruals deferred until they are withdrawn. In this case, the plan is only a more generous example of a typical civilian employee pension plan.

Healthcare

Naval retirees can enroll in TRICARE, the Department of Defense's healthcare system. This HMO-style system is the same throughout the military. The Standard and Extra plans are available to retirees. Extra offers more coverage, but also has a higher premium and fees. However, TRICARE is highly competitive compared to even the best private or employer-sponsored healthcare plans in the civilian world, with the main caveat being that a retiree must live near a TRICARE facility--a military installation--for it to be convenient. Navy retirees can also subscribe to TRICARE Retiree Dental. This plan is the dental plan for active duty naval personnel, and in many ways offers more flexibility in getting dental services outside of TRICARE dental facilities.

Federal Employment

All who leave the U.S. Navy on a discharge that is not dishonorable are eligible for preferential treatment on federal civil service examinations. Veterans of the Second World War; the Korean War; service of 180 days or more during the period of January 31, 1955 to October 15, 1976 (essentially the height of Cold War conscription and the Vietnam War); the Persian Gulf War; Operation Iraqi Freedom all receive five extra points. A veteran holding any authorized campaign medal covering action not already described also receives five extra points. Furthermore, Navy veterans who meet the preceding qualifications and received the Purple Heart decoration, or were otherwise disabled, receive an extra 10 points.

G.I. Bill

Retired sailors and officers who are also war veterans are eligible for benefits under the G.I. Bill. This provides funding for education. The retiree must be a war veteran, discharged any terms that were not dishonorable, and have a high school degree or the equivalent. In 2008, G.I. Bill recipients received $1,321 a month for college education or vocational training. The G.I. Bill in 2008 had a maximum grant of $47,000 over the course of 36 academic months. That time period is measured to be the same as a normal four-year college degree.

Veterans Administration

U.S. Navy retirees are also eligible for certain benefits with the Veterans Administration (VA) if they are poor enough to pass the means testing. Retired sailors and officers can receive a VA pension if they are over 65 or disabled, served a minimum of 90 days in the Navy with at least a single day in combat, and were discharged on terms other than dishonorable. The means testing guarantees that only those in poverty receive a VA pension. For example, a single Navy retiree with no dependents needed to have an income below $11,830 in 2008 in order to qualify. All the same conditions apply to VA healthcare, with the added stipulation that access is doled out on the basis of need. Ergo, the sickest and poorest Navy veterans get priority access to VA healthcare.