1.) they are pushing this way too hard, 2.)
So at this point I'm leaning towards staying with the old system.
Humans make decisions from math & logic, but there's also a large component of behavioral financial psychology. An example is the perpetual debate of paying off the mortgage-- some do the investment math and take the risk while others "feel better" being totally debt-free with less risk.
Skepticism is understandable, especially because DoD is indeed saving their fair share of the money on the new system. DoD may be a non-profit, but it's not a charity.
Yet it's also possible that their hard push is simply due diligence: making sure Congress knows that DoD did the best they could to inform everyone of their options. You know that in 2019 at least one organization is going to file lawsuits accusing the federal govt of not adequately informing servicemembers & families of the reasons to opt in to BRS, and tragically allowing people to miss the deadline. I have a few readers today who say that they don't invest in the TSP because the military never explained it to them well enough.
2.) By the time I'm 60, I'll have at least 2-3 million (maybe more) in 401ks and other investments directly tied to the market, in other words, way more than I could even need, and running my cash flow risk high in case of a significant, badly timed downturn. An extra, say 75-100k in TSP matching + growth will not make much difference as a % of the total investments.
... the extra .5 in the multiplier would result in a significantly higher pension which is guaranteed and adjusts for COLA. It would function as a higher safety net so I could keep my other investments in more aggressive investment options which would statistically result in additional returns even during retirement.
Math & logic. Absolutely. You'll reach financial independence even without the pension, right?
But if I make it to O5/O6,
Here's the potential logic flaw. Way too many people make the implicit assumption that they'll get to 20. Yet the data shows how statistically unlikely that is, and people have a hard time believing that they'll be a statistic.
The risk of staying with High Three is cliff-vesting at 20. Statistically, you'll end up with nothing. Individually, you risk being forced to gut it out to 20 while risking your health physically, emotionally, and even mentally. (Again, this is not just my personal experience but also what readers tell me.) If you're willing to accept that risk-- and especially if you'll reach FI without High Three-- then you're making an informed choice.
Or you could take less risk now and less risk later. Sort of like paying off the mortgage.
Looking back 20-30 years, I would've gone to the Reserves around my 10-12 year point-- when we started a family and my military staff job was unbelievably sucky. Life would've worked out about the same, and so would the money. Ironically today I can see that I would've made *more* money by going to the Reserves and having the time to develop a civilian career, either corporate or freelance. But instead I gutted it out-- and I saw the health effects.
Yet I don't have to look back 20-30 years, because today there's another Nordman in her 20s who's facing the BRS decision too. I've advised my daughter (and my son-in-law) to take the BRS for the career flexibility, and also because their high savings rate tells me that they'll achieve FI without any pension at all-- let alone having to take the risk of gutting it out for a High Three pension.
If you're going to stick with High Three-- either logically or emotionally-- then have a plan for the statistical possibility that you won't make it to 20 in the first place.