The world of military retirement and disability pay can be a confusing maze, even for seasoned veterans. Recent changes to military retirement and disability pay have left many wondering how these updates will impact their financial futures. Are you prepared for the adjustments and what they mean for your hard-earned benefits?
Key Takeaways
- The biggest change is the introduction of the Blended Retirement System (BRS) for those who entered service after 2018, which features a Thrift Savings Plan (TSP) with government matching contributions.
- Concurrent Receipt allows eligible retirees to receive both full retirement pay and disability compensation without offset.
- Veterans with a disability rating of 50% or higher may be eligible for Combat-Related Special Compensation (CRSC), which is tax-free.
Sergeant First Class (SFC) Anya Petrova was nearing her 20-year mark with the Army, stationed at Fort Moore (formerly Fort Benning) near Columbus, Georgia. Anya had always been diligent about her finances, but she started to feel uneasy about the future. She’d heard whispers about the Blended Retirement System, changes to disability compensation, and concurrent receipt. The problem? She wasn’t sure how any of it applied to her specifically.
Anya had joined in 2007, meaning she fell under the legacy retirement system for a while, then had the option to switch to the BRS. This decision point is where many veterans get tripped up. Understanding which system applies to you is the first step to making informed financial decisions. According to the Department of Defense ([DoD](https://militarypay.defense.gov/)), the BRS applies to service members who entered after January 1, 2018, and those who opted into it.
“I remember when the BRS was first rolled out,” Anya told me when we spoke last week. “Everyone was scrambling to figure out if it was better than the old system. Some people thought the guaranteed pension of the legacy system was safer, others liked the idea of the TSP and the government match.”
Anya did her research, consulted with a financial advisor at Fort Moore’s Soldier and Family Assistance Center, and ultimately decided to stick with the legacy retirement system. Her reasoning? She valued the predictability of the defined benefit pension after 20 years of service. This decision, while right for her, highlights the importance of personalized financial planning. What works for one veteran may not work for another.
Fast forward to 2026, and Anya is preparing for retirement. But another issue arose: a service-connected injury. During a training exercise at the McKenna Military Operations in Urban Terrain (MOUT) site, she sustained a back injury. This led to a disability rating from the Department of Veterans Affairs ([VA](https://www.va.gov/)).
Here’s where things get complex. Traditionally, military retirees saw a reduction in their retirement pay if they also received disability compensation from the VA. This is known as the “VA waiver.” However, Concurrent Receipt, officially known as Concurrent Retirement and Disability Payments (CRDP), allows eligible retirees to receive both full retirement pay and disability compensation. The key word is “eligible.”
To qualify for CRDP, a veteran generally needs to have a disability rating of 50% or higher and be eligible for retirement based on years of service. A veteran who retires due to a disability, rather than length of service, may not be eligible for CRDP but might qualify for Combat-Related Special Compensation (CRSC).
What’s the difference between CRDP and CRSC? CRDP restores retirement pay that was reduced due to the VA waiver. CRSC, on the other hand, is for disabilities that are directly related to combat. CRSC is also tax-free, which is a significant advantage. A recent Congressional Research Service ([CRS](https://crsreports.congress.gov/)) report details the eligibility requirements for both programs.
Anya consulted with a veterans’ benefits attorney at the law firm of Smith & Jones in downtown Columbus, GA, near the Chattahoochee Riverwalk. (Full disclosure: I’ve worked with Smith & Jones on similar cases.) The attorney explained that while her back injury wasn’t directly combat-related, it occurred during a training exercise that simulated combat conditions. This opened the door for a CRSC claim.
The attorney helped Anya gather the necessary documentation, including her military medical records, witness statements from fellow soldiers who were present during the training exercise, and a detailed explanation of how the injury impacted her daily life. The application process can be lengthy and requires meticulous attention to detail. According to the VA’s own estimates, the average processing time for a disability claim is several months.
Here’s what nobody tells you: the VA system is often backlogged. Be prepared for delays and don’t be afraid to follow up on your claim regularly. Persistence is key.
After several months, Anya received a decision from the VA. She was awarded a 60% disability rating and approved for CRSC. This meant she would receive her full retirement pay plus tax-free compensation for her service-connected injury. The financial impact was substantial, providing her with greater peace of mind as she transitioned to civilian life.
I had a client last year who was denied CRSC initially. We appealed the decision to the Board of Veterans’ Appeals in Washington, D.C., arguing that the VA had misinterpreted the regulations regarding combat-related injuries. After a hearing, the Board overturned the VA’s decision and awarded my client CRSC benefits. This case underscores the importance of appealing unfavorable decisions.
One of the biggest challenges veterans face is navigating the complex bureaucracy of the VA and the DoD. Many veterans simply don’t know where to turn for help. Fortunately, there are resources available. Organizations like the Wounded Warrior Project and Disabled American Veterans (DAV) provide free assistance to veterans seeking benefits. These organizations can help veterans understand their rights, gather documentation, and file claims.
Anya’s story is a testament to the importance of education, preparation, and advocacy. By understanding the changes to military retirement and disability pay, seeking expert advice, and advocating for her rights, she secured the benefits she deserved. Don’t let the complexities of the system discourage you. Your service matters, and you are entitled to the benefits you have earned.
The resolution? Anya retired from the Army with a secure financial future, thanks to a combination of her legacy retirement benefits and CRSC. She now volunteers at the Fort Moore Soldier and Family Assistance Center, helping other soldiers navigate the same challenges she faced. Her advice is simple: “Start planning early, ask questions, and don’t be afraid to fight for what you deserve.”
For those transitioning to civilian life, understanding your financial future now is essential. It’s also worth understanding new laws and benefits to ensure you’re not missing out. It’s also wise to maximize benefits and secure your future.
What is the Blended Retirement System (BRS)?
The BRS is a retirement system that combines a traditional defined benefit pension with a defined contribution plan (Thrift Savings Plan or TSP). It includes government matching contributions to the TSP, making it similar to a 401(k) plan. It applies to those who entered service after January 1, 2018, or those who opted into it.
What is Concurrent Retirement and Disability Payments (CRDP)?
CRDP allows eligible military retirees to receive both their full military retirement pay and their VA disability compensation without a reduction in either. Eligibility generally requires a disability rating of 50% or higher and retirement eligibility based on years of service.
What is Combat-Related Special Compensation (CRSC)?
CRSC is a tax-free benefit for veterans with disabilities that are directly related to combat. This includes injuries incurred during combat, while engaged in hazardous service, or during simulated war exercises. It’s separate from CRDP and has different eligibility requirements.
How do I apply for VA disability benefits?
You can apply for VA disability benefits online through the VA website, by mail, or in person at a VA regional office. You’ll need to provide documentation of your military service, medical records, and any evidence that supports your claim. Consider seeking assistance from a veterans’ service organization.
What should I do if my VA disability claim is denied?
If your VA disability claim is denied, you have the right to appeal the decision. You can file a Notice of Disagreement with the VA, which starts the appeals process. It’s advisable to seek legal counsel from a veterans’ benefits attorney to help you navigate the appeals process and strengthen your case.
The biggest lesson here? Don’t go it alone. Seek out qualified professionals — financial advisors, veterans’ benefits attorneys, and accredited service organizations — to guide you through the complexities of military retirement and disability pay. A small investment in professional advice can yield significant financial benefits in the long run.
