A shout out to all the readers in the LT locker downstairs! Thank you for the readership, I made a post just for you. Reports from new LTs from ODS indicate there is a lot of bad & biased gouge given in Newport regarding the BRS. The blanket consensus was BRS had no possible benefit for those joining now. They cold not be further from the truth.
This blanket statement might have been based on old unofficial details about the system. When BRS was first conceived you needed 5 years of service to be vested, which is too long to benefit those with intentions of private practice after their pay back. According to the Official Navy Blog, matching starts immediately for those opting in on Jan 2018. We now know even the short timers will get in on some of this sweet free money. How much free money exactly?
||Monthly O-3 Base Pay
||My Pay Monthly Allocation
||5% Match for year
Well, those residents that do the required 5 years would have enough free matching money to have a significant start on their retirement. Note that you must put in $198.18 ramping up to $264.36 a month (5% of your own base pay) to get the match. Those credentialers would have a modest $5,605.20 of sweet free money after their time is up after 4. It is a no brainer to go for the BRS, especially if you have no intention to ever do 20 years. You would be leaving free money on the table. Just make sure you put 5% into TSP, which you should be doing anyways.
I got my BRS golden ticket today in my work email. Here is the excerpt that makes me feel special:
Those members with fewer than 12 years of service as of December 31, 2017, have the option of switching to the Blended Retirement System if they so choose. Our records indicate you will have the opportunity to make this choice because you will have fewer than 12 years of service as of December 31, 2017
For those that did not get the email, then too bad your stuck with the old retirement system. You have no choice but to take the Clift Vested 2.5% for each year served in the military, starting at 20 years of service:
You may be aware that on January 1, 2018, the Department of Defense will introduce a new military retirement system known as the “Blended Retirement System.” Anyone who joins the military from that date onward will be covered by the new retirement system, while anyone serving prior to that date, including you, will be grandfathered under their current retirement plan.
Now the scary part:
The first opportunity to elect to enroll in the Blended Retirement System will be on January 1, 2018. You will have the entirety of 2018 to make your election. However, once you enroll in the Blended Retirement System, that election is irrevocable.
However there is a clause for the very lazy that simply don’t give a crap about getting old:
While you will have a choice to make, it is important to note that you will remain covered under your current retirement plan unless you choose to switch. You will not be automatically moved to the Blended Retirement System.
The game changes so quickly, it was all about airline miles before, but loyalty sucks and the consumer knows it. With ever devaluing miles, mile expiration, and so many new rules and fuel surcharges, it’s very easy for a program like Chase Ultimate Rewards (UR) and American Express Membership Rewards (MR) to become populat with offering an airline independent points system. Even Wired magazine lays out why the system is so convoluted, and unattainable with the new unfortunate trend of Qualifying Dollar requirements. It’s not enough you spent 50,000 ass in the seat miles on a United flight, but you now need 4 segments as well as dropping $6,000 a year just to qualifying for premier gold.
Like all bad, demanding, and outright abusive relationships, many of us have dropped our loyalty. Even The Points Guy has re-evaluated transferring MR points for redemption. Why dedicate your loyalty to a single airline company? AmEx has a system of Centurion Domestic lounges being built up along side access to international Priority Pass lounges. With the fee waivers for luggage, and the free Uber, you get the first class experience while flying the basic bitch seat. The game is now about credit card points that you can use to book any airlines. We are now free from marrying a single airline, and just causaly date them from trip to trip.
Just two days after booking, I got my 50% of my points back when booking travel with AmEx Travel Services:
All I had to do was choose United as my airline for both the $200 credit and my 50% back on my AmEx Business Platinum Card. Then I just logged into AmEx Travel and checked out paying with points.
This makes my Membership Rewards Points worth 2 cents per point. I got a round trip to HKG for my mom for about a third of the bonus of the AmEx Business Platinum card. Right now they are offering 100,000 MR points in two tranches. 50k for $5k spend, and then another 50k for $10k more spend. Planning to do the gold old Krugerrand bet to help meet the $15k.
Go ahead and jump on this before the year ends so you can claim your $200 credit!
The points guy took a good look of hotels that are relatively cheap that qualify for the $100 hotel credit from AmEx fine hotels and resorts. Since I am on a Ritz kick, I decided to do the same with the Government & Military Discount rate at the Ritz Carlton Hotels in USA and Canada:
||15000 North Secret Springs Drive Marana, AZ 85658 USA
||0130 Daybreak Ridge, P.O. Box 9190 Avon, CO 81620 USA
||1881 Curtis Street Denver, CO 80202 USA
||4750 Amelia Island Parkway Amelia Island, FL 32034 USA
||2600 Tiburon Drive Naples, FL 34109 USA
||Naples Golf Course
||181 Peachtree Street, N.E. Atlanta, GA 30303 USA
||3434 Peachtree Road, N.E. Atlanta, GA 30326 USA
||1 Lake Oconee Trail Greensboro, GA 30642 USA
||160 East Pearson Street at Water Tower Place Chicago, IL 60611 USA
||921 Canal Street New Orleans, LA 70112 USA
||10 Avery Street Boston, MA 02111 USA
||100 Carondelet Plaza St. Louis, MO 63105 USA
||Two West Street New York, NY 10004 USA
||3 Renaissance Square White Plains, NY 10601 USA
||1515 West Third Street Cleveland, OH 44113 USA
||181 Wellington Street West Toronto, M5V 3G7 Canada
||10 Avenue of the Arts Philadelphia, PA 19102 USA
||1250 South Hayes Street Arlington, VA 22202 USA
||1700 Tysons Boulevard McLean, VA 22102 USA
||1150 22nd Street, N.W. Washington, DC 20037 USA
The two icons of the churning world are David Phillips with his 12,000 pudding cups, and Brad Wilson with his $3,000,000.00 of dollar coins in 8 months. These seemingly pointless purchases all of course were done to earn credit points, with the latter procedure described as “Manufactured Spending” or MSing.
Brad Wilson bought three million $1 coins from the US Mint which were being sold without premium, and shipped free to his house. He would then use the float time to deposit the coins and pay off the credit card bill. This would produce spend on the card which earn points on his SPG card. It was of no risk to him as what he was buying was actual US currency. This whole procedure triggered nasty letters from the Treasury, but even in the end they had to admit what he was doing was not illegal. He was the Rick Barry of churning, widely unpopular in technique, but certainly got some good results. After getting his 4 million AA miles, the whole system got shut down. You can no longer buy the dollar coins with a credit card for the points.
Much like Spinal Tap, there was very little fanfare when the Gold Luxury Card came out here in the USA, but lots of buzz was generated overseas. Looks like Americans didn’t find value in paying $1,000 for a flashy gold plated card. Luckily, there is a population that loves expensive shiny shit that yells out status and Gold Luxury Card has found this market in Japan!
Looks like there is quite a response around the first World Elite MasterCard to roll out in Japan. The press release can be found here, and the blog here and here. Of course they are charging $2,000 a year for the damn thing, but they added a lot of new benefits not found in the USA version:
- Hawaiian Airlines Pualani Platinum Membership
- 3x Points per 100 yen spent
- Points transfer to ANA and JAL
- Airport limousine reimbursement service
- Local car pick up and drop off service in Tokyo
- Hawaiian Airport Lounge Access
- Luxury Lounge in NYC that opened in November
I have been pretty critical about AmEx and its response to the CSR, but I’ve got to tell you this new 5x MR on flight booking for personal Platinum (not biz) along with this new benefit on the Business side of 50% MR back on booking got me interested in MR point redemption strategy. I read this article from the points guy, and he got me back in the AmEx MR fanboy club.
I am sending my mom to Hong Kong round trip for 36,593 MR points which is 2 cents per MR point when compared to buying the flight direct from United for $731.86. Also, United wanted 80,000 MP miles and $58.16 making the redemption less than one cent per mile. Any time you get less than one cent per mile for United, you know it’s a terrible deal.
In my analysis I had forgotten about the use of catch up contributions at the ever approaching age of 50. According to the TSP website a member age 50 or older (or turning age 50 during the calendar year) can contribute $6,000 on top of their $18,000 as a “catch-up” According to my estimation data found here, at the age of 50 I will be an O-6 with 20 years service. This would mean a $24,000 contribution that year, with a 5% base pay match of $5,908.68 with BSR. Total of that is a $29,908.68 after tax contribution to my Roth TSP. Remember since you paid taxes on this money, all future earnings will not be further taxed.
The other major mistake was not considering my active duty spouse into this situation. If my spouse and I do the same thing and maximize our TSP by contributions of $18,000 a year each, then after 50 we do $24,000 each. We would also both switch to BRS and take the 5% match. Then we assume the normal ideal promotion and stay Active Duty, in the 30 years we can see a significant increase in TSP due to the massive match at the later O-6 years. I recalculated the data and had these findings: