Military retirees with at least a bachelor’s degree have a higher net-earning and are more satisfied than veteran non-retirees and civilians, a Rand Corp. report found. 

The report analyzed a cohort of men born between 1931 and 1941, who served prior to the modern all-volunteer force, to understand the relationship between their service and life outcomes.

For military retirees without a bachelor’s degree, “military retirement benefits effectively offset the earnings gap” they experienced compared to their fellow veterans without retirement benefits, according to the report. 

For veterans with at least a bachelor’s degree, “military retirement benefits more than offset the gap” compared to veterans without retirement benefits. 

Satisfaction with earnings, both during and after service, are key to military readiness, the report found.

“From the standpoint of military readiness, it is critical that military members with the talents and capabilities to serve in senior leadership positions find earnings over a military career adequately attractive, including post-service civilian earnings opportunities, to induce them to stay for a career and seek higher-ranked positions where they are best suited,” according to the report.

Given changes to the U.S. military since the cohort studied retired, the report notes that “military pay increased dramatically during the early years of the [all-volunteer force]” and that “newer entrants may be eligible for better civilian opportunities and better post-service earnings than draft-era personnel.” 

By the time military retirees in the cohort were 55 and 56, they “had greater accumulated wealth” and “had on average $292,000 more” than veteran non-retirees, the report found.

Further, military retirees were slightly more satisfied with retirement than veterans without military retirement benefits. “At ages 62 and 63, the earliest eligibility age for Social Security benefits, … 66 percent of military retirees reported being very satisfied with retirement, 4 percentage points more than veteran non-retirees,” the report found. “As they aged, a greater share of military retirees expressed being very satisfied with retirement, and 70 percent were very satisfied by ages 70 and 71.”

Military leaders can rest assured that the military retirement benefit will support their soldiers as they transition to civilian life, the report says. “For military leaders concerned with whether the military retirement benefit is sufficient to offset negative post-service earnings outcomes, the answer is yes—benefits are sufficient for the cohort studied here,” the report found. 

Read the full report here.