Military Times

2012 Benefits Handbook

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Pay and Benefits



Commissaries are military supermarkets that sell all items at cost plus a 5 percent surcharge. The Defense Commissary Agency oversees 247 stores worldwide on Army, Air Force, Navy, Marine Corps and Coast Guard installations.

Most of DeCA’s larger commissaries are relatively full-service grocery stores. The commissaries routinely stock 4,000 to 18,000 items in grocery, meat, produce and deli, bakery, household, health and beauty care departments.

Contact: DeCA uses social media to get information to patrons. Along with its website at, DeCA is also on Facebook at www.face, Twitter at, Flickr at, and YouTube at

Case lot sales. Generally held in May and September, often in tents in commissary parking lots, these popular sales offer deals above and beyond standard commissary savings. Sometimes they sell items in bulk or club packs, like some civilian warehouse discounters. As those months draw near, visit, click “Shopping” and then “Case lot sales” for information on your commissary’s case lot sale.

Customer satisfaction. Commissary products can be returned.

Eligibility. Those with a valid military ID card can shop in commissaries. This includes single and married active-duty, National Guard and reserve, and retired members, regardless of rank or service, and their families. Also eligible are 100 percent disabled veterans, surviving spouses, and former spouses with dependent children. Special assistance is offered for those with disabilities or infirmities.

Individuals caring for children of service members who are deployed, on remote assignment or deceased may be authorized to use the commissary for 12 months — sometimes longer in cases of continued hardship.

Exclusive Savings program. Through links to their websites from, some manufacturers and distributors offer coupons and information about special sales in commissaries. The “Exclusive Savings” icon is on the commissary home page. The Defense Commissary agency doesn’t control the websites or what manufacturers offer, but provides the links as a way for manufacturers to offer something extra to commissary customers.

Gift cards. Commissaries offer gift cards in denominations of $25 and $50. Anyone can purchase a gift card through the DeCA website,, or in a commissary. But only authorized customers can use the cards, which expire five years from the date of purchase and cannot be reloaded or redeemed for cash.

It’s best to buy them in a commissary; the online vendor charges a 3.5 percent processing fee on the dollar amount of the card, as well as shipping charges of $1.95 for first-class mail. On a $25 gift card, that’s a total of $27.83. For orders totaling $200 or more, shipping is $6.95 by priority mail. The cards can be shipped anywhere in the U.S. or to any APO, FPO or DPO addresses overseas.

The cards can be used for in-store purchases, and the balance can be checked online at Commissary gift vouchers purchased under a previous program that is discontinued can be redeemed at commissaries for up to five years from the date of purchase.

Hours. Most stores have evening and weekend hours. To find a store’s hours, visit and select “Locations,” then “Alphabetical Listings.”

Locations. The store locator at under the “Locations” tab has information on the nearest store, with driving directions, phone numbers, floor plans and current information about savings at specific stores.

In addition, the commissary agency has taken the benefit on the road to National Guard and reserve communities that have no commissaries. Anyone with commissary privileges is eligible to shop during these weekend events, and pre-ordering is often available. For a schedule and locations, click on the “Guard/Reserve On-Site Sales: Bringing the Benefit to You” icon on the home page at

Overseas. Commissaries overseas operate under unique restrictions. Limits are imposed on purchases of items that can be sold on illegal markets; in South Korea, for example, shoppers are limited to a monthly spending cap based on family size.

Rules on who can use overseas commissaries are affected by status-of-forces agreements between host nations and the U.S.

Service members on leave, retirees, and National Guard and reserve members on official duty in Germany are not automatically granted full commissary privileges. Situations may vary by country, and individuals should check with the local U.S. military command or installation they plan to visit before they travel.

Payment. Commissaries accept cash, personal checks, traveler’s checks, and debit and credit cards. Electronic benefit transfer cards for the Supplemental Nutrition Assistance Program, or SNAP (formerly the Food Stamps program), as well as WIC vouchers, are accepted in the U.S., including Puerto Rico and Guam. Commissaries overseas accept the overseas military-issued WIC vouchers for military families.

Sales restrictions. Federal law restricts what commissaries can sell. For example, they do not stock beer, wine and many general merchandise items carried by base exchanges.

Savings. Shoppers get average savings of 32 percent or more. There is no sales tax. The 5 percent surcharge pays for construction and renovation of stores and equipment purchases. For information on monthly sales and promotions, visit and click on “Shopping.”


Exchanges are the military’s version of department stores. Soldiers call it a PX, for post exchange. Airmen say BX, for base exchange. Sailors call it a ship’s store when afloat and NEX, for Navy Exchange, when in port; Marines say MCX; to a Coast Guardsman, it’s CGX.

In addition to their brick-and-mortar stores, exchanges sell to authorized customers via retail stores, catalog and their online websites.

Exchanges sell brand-name goods from civilian companies, as well as their own private-label items. There is no sales tax, and prices usually are lower than commercial retail prices.

There are four exchange systems:

♦ Navy Exchange Service Command, based in Virginia Beach, Va., operates 293 stores of varying sizes and more than 1,200 service outlets at 104 Navy installations around the world.

♦ Marine Corps Exchange system operates 17 Marine Corps exchanges with 225 resale facilities and reports to the Corps’ Semper Fit and Exchange Services Division at Marine Corps Base Quantico, Va.

♦ Coast Guard stores are run by the Coast Guard Headquarters’ Exchange and Morale Division in Washington. In addition to land-based stores, the Navy and Coast Guard run floating ship’s stores, stocked largely with toiletries and snack foods, uniforms, CDs and CD players.

♦ Army and Air Force stores, known for decades as the Army and Air Force Exchange Service, is now called simply The Exchange. Based in Dallas, this is the oldest and largest of the exchange systems, with more than 3,100 facilities, including 180 main stores, in the U.S., its territories and more than 30 foreign countries.

Army and Air Force exchanges and Marine Corps exchanges also support military personnel deployed to the Afghanistan war zone and elsewhere through three increasing levels of Tactical Exchange Support: Imprest Fund Activities, Tactical Field Exchanges and Direct Operation Exchanges.

Active-duty Marines deploy to run the Marine exchanges in the war zones.

At any given time, some 300 Exchange associates are voluntarily deployed in support of these contingency operations. The stock assortment found in these exchanges varies by location, but even the most basic operation provides access to toiletries, snacks and cold drinks.

Exchanges not only support themselves almost completely through their sales income, but all earnings generated from sales are ultimately returned to the customer. For example, about three-fourths of NEX profits are paid to Navy Morale, Welfare and Recreation programs, while the remainder is used to build new stores or renovate existing NEX facilities at no expense to taxpayers.

Academic rewards. Exchanges offer rewards such as savings bonds and coupons for student achievement. See local exchanges for details.

NEXMarts. Some installations have combined commissary and exchange stores called NEXMarts, BXMarts or CXMarts. Food is priced as commissary items — at cost plus a 5 percent surcharge added at the checkout counter. Other items carry exchange prices, with variable markups.

Eligible shoppers. Eligible shoppers include all ranks of active-duty, retired, National Guard and reserve members and their families, some disabled veterans and their families, surviving spouses and former spouses. Limits or restrictions may apply; check with local exchanges. Those eligible can shop at any exchange, regardless of service affiliation.

Gift cards. The exchanges sell gift cards in their stores and through their websites.

NEX-, Exchange- and MCX-specific gift cards can be redeemed at any Army, Air Force, Navy or Marine Corps Exchange facility.

The Exchange offers a program, “Gifts from the Homefront,” under which any American, even those who are not authorized customers, can buy gift cards for donation to deployed troops, who can use the cards to shop at exchanges in forward areas, such as Afghanistan.

Anyone can send a gift card by visiting or calling 800-527-2345. The cards may be sent to an individual service member designated by the purchaser, or distributed to “any service member” through the Air Force Aid Society, American Red Cross, Fisher House, Navy-Marine Corps Relief Society, Warrior and Family Support Center or USO.

Mail order. Exchange items can be purchased through the Exchange Catalog, available to all service members. The two “big book” catalogs, released in spring and fall, are $5, but include $30 in coupons. Individual exchanges also offer specialty catalogs for uniform items, furniture and other needs.

Contact: Orders can be placed by mail, fax or phone. Toll-free orders can be placed from the U.S., Puerto Rico or Guam at 800-527-2345. The Exchange Catalog center is open around-the-clock, seven days a week. Complimentary international access calling is available from several countries. Those numbers are:

♦ Germany, 0800-82-16500

♦ Japan/Okinawa, 00531-11-4132

♦ South Korea, 00308-13-0664

♦ Italy, 8008-71227

♦ Belgium, 0800-7-2432

♦ Netherlands, 0800-022-1889

♦ United Kingdom, 0800-96-8101

♦ Spain, 900-971-391

♦ Turkey, 00800-18-488-6312 (Calls must be made from off-base commercial lines.)

Authorized customers can also shop online at,, or

Contact: Exchange Catalog Sales, P.O. Box 660211, Dallas, TX 75266-0211; 800-527-2345; fax: 800-446-0163;,;

Malls. Many bases have shopping malls near their exchanges and commissaries. Services include uniform shops, barber shops, beauty parlors, dry cleaners, bookstores, florists and food courts.

MWR. After covering operating expenses, a part of exchange earnings support on-base morale, welfare and recreation programs such as swimming pools, and arts and crafts centers. For example, in 2010, The Exchange contributed $261 million in dividends to military MWR programs; NEXCOM contributed $48 million and Marine Corps Exchanges kicked in $48 million.

Other services. The Exchange operates a dental clinic for family members at Fort Hood, Texas, and the Marine Corps offers the same at Camp Pendleton, Calif., to help relieve a shortage of dental staff there. Fees are comparable with those under the Tricare Dental Program.

The exchange systems also run optometry and audiology clinics at several bases. Clinics are run by private contractors overseen by local military medical officials. Navy clinics are run by private contractors, with no military medical oversight.

Other exchange facilities include gas stations, laundries and auto service centers. Some exchanges offer services such as one-hour photo shops, movie rental vending machines and more (although NEXs no longer offer such services).

The military services operate their package, or liquor, stores as exchange operations.

Online shopping. Online stores at,, and offer items via their main sites as well as products from virtual vendor partners and Exchange Online Mall partners. The Internet extends the exchange benefit worldwide to an extremely mobile customer base. is operated for all the military exchange services by the Army and Air Force Exchange Service and features more than 18 million items, if you count the Exchange Online Mall with items from a variety of vendors.

The all-services shopping site also features an online auction site. In the menu under Exchange Online Mall, select “Exchange Auctions.”

The website features items sold at the same price offered in brick-and-mortar Navy exchanges, with new items continually added.

The secure websites will verify your exchange privileges against the Defense Enrollment Eligibility Reporting System, or DEERS, database. Eligible shoppers can create login names and passwords. Items ranging from curtains to children’s clothes to uniforms are available.


Overseas. Overseas stores offer many U.S. products that may be difficult to find otherwise. Commands often impose shopping restrictions to limit the sale of U.S. goods on the illegal market. Items bought through an exchange or commissary cannot be resold, even at cost. Military police patrol larger exchange shopping areas for illegal marketers.

There also are restrictions on gifts bought in overseas exchanges. For example, cigarettes or alcohol bought in exchanges cannot be given to foreign nationals.

Payment. Exchanges accept MasterCard, Visa, American Express and Discover credit cards. Exchanges also offer their own credit plan through the joint-exchange Military STAR Card. Exchanges cash personal checks at no charge with a military ID.

Prepaid phone cards. Exchanges carry phone cards with rates for specific geographic areas, including war zones.

Military Exchange Global Prepaid Calling Cards can be used to call from 200 countries and to call between 90 countries around the world, including any of The Exchange’s 16 phone centers in Afghanistan and 14 in Kuwait. The minutes on these exchange prepaid phone cards never expire. No additional charges or connection fees are ever added.

Along with the traditional call centers, The Exchange also has aggressively expanded mobile/cellular and Internet services available downrange to provide a broader range of options when it comes to staying connected with home.

The Exchange’s Help Our Troops Call Home program, at, lets anyone send Military Exchange Global Prepaid Calling Cards to individual service members or to “any service member” through the Air Force Aid Society, American Red Cross, Fisher House Foundation, Navy-Marine Corps Relief, USO and Soldier & Family Assistance Center, or SFAC.

More details about AAFES and Help Our Troops Call Home are available at or by calling 800-527-2345.

NEXCOM offers calling aboard most Navy ships and some Coast Guard cutters for 45 cents per minute back to the U.S. On land, NEX offers a virtual worldwide prepaid phone card for calls from anywhere in the U.S., and to and from 200 countries around the world.

Price matching. Exchanges will match lower prices on identical items sold by local competitors. For example:

♦ Navy Exchange and Marine Corps Exchange shoppers who see a price difference at the store of less than $5 can tell the cashier, who will match it on the spot. Army and Air Force exchange shoppers who see a price difference of less than $10 can have the price matched on the spot.

♦ NEX and MCX customers who report a price difference of greater than $5 need to bring a current local competitor’s ad to receive the reduced price.

For Army and Air Force exchange customers, the same policy applies, but the price difference must be greater than $10.

If within 14 days of purchase, the identical item is offered at a lower price by an Army or Air Force exchange, an NEX or a local competitor, a refund will be given for the difference. Bring a copy of the ad and receipt to the NEX or Army or Air Force exchange.

Because the exchanges have a dual mission to provide quality merchandise and services at competitively low prices and generate earnings to supplement MWR programs, there are exceptions to the price-matching program.

Exclusions include special offers or promotions, free-with-purchase offers, limited-quantity offers, bundled promotions, special financing, “gimmick” promotions, special-order automotive parts, gasoline, automotive labor/service, double and triple coupons, clearance items, flat percentage-off items and vending items. Marine Corps exchanges do not match prices on alcohol and tobacco.

The price-matching policy applies to all Army and Air Force exchanges and NEX retail stores including main stores, Expresses (mini-marts), Class Six package stores, Car Care auto ports and troop stores. Complete details are online at, or

Restaurants. The exchange systems also operate thousands of name-brand eateries on installations around the world and contingency areas, ranging from Subway to Baskin-Robbins to Five Guys Burgers and Fries, depending on the area.

Sales restrictions. Congress restricts what can be sold at exchanges. Stateside exchanges cannot sell cars or fur coats, for example. The Armed Service Exchange Regulations also limit the size of diamonds and type of furniture sold in stateside stores. Exchanges can sell finished furniture, although any one piece cannot cost more than $900.

In addition, Congress has banned the sale of sexually explicit materials in exchanges. Material is reviewed by a Defense Department board to determine whether it can be sold in the exchanges.

There are also some pricing restrictions. Defense Department policy mandates requirements for setting prices on gasoline, alcohol and tobacco.

Savings. Customer savings on exchange purchases average 17 percent to 27 percent compared with off-base retailers. That is over and above savings derived from exclusion of sales taxes. There is no surcharge on exchange purchases.

Store brands. Along with brand-name items, the exchanges carry private-label merchandise with the same quality as national brands, found exclusively in military exchanges, at significant savings. For example, the Exchange Select line offers military service members and their families high-quality, value-priced products. With about 600 items in categories such as health and beauty care, household cleaning, laundry and single-use cameras, Exchange Select products provide a low-cost alternative to national brands and are made by reputable manufacturers.

Troops and their families can save an average of 50 percent over national brand equivalents. Quality assurance representatives actively ensure the quality of Exchange Select merchandise by visiting suppliers’ plants to verify that “Good Manufacturing Practices,” as set by the Food and Drug Administration and other governing agencies, are used. All over-the-counter medicines, such as ibuprofen and acetaminophen, meet FDA-established guidelines, which are the same for Exchange Select and national brand-equivalent products.


Most military installations have casualty assistance officers to help families of service members who die on active duty. The officers are responsible for notifying the family of the death and circumstances surrounding it. In accordance with the family, they also can assist with burial arrangements.

Death gratuity. In most cases, survivors of service members who die on active duty are eligible for a $100,000 “death gratuity,” regardless of whether the death occurred in the line of duty.

Service members may designate the full $100,000 to anyone they choose, in 10 percent increments. If a member does not make any designation, the money would go to survivors in a standard order set by law: surviving spouse, children, parents and siblings, the duly appointed executor or administrator of the member’s estate, and finally to any other legal next-of-kin.

Burial/funeral allowances. The Defense Department reimburses burial expenses up to $8,800 in private cemeteries and up to $7,300 in a national or other government cemetery if the family arranges for the casket and preparation of remains.

If a military service arranges for the casket and preparation of remains, DoD will reimburse families for expenses up to $1,000 for remains consigned directly for burial in a national or other government cemetery; up to $3,000 for remains consigned to a funeral home for burial in a national or other government cemetery; and up to $6,000 for remains consigned to a funeral home for burial in a private cemetery.

The Pentagon also reimburses families for the money they spend to transport remains to their final destination.

Current law authorizes the service secretaries to provide round-trip travel and transportation allowances to eligible relatives of a service member who dies while on active or inactive duty so that the eligible relatives may attend the burial ceremony of the deceased member. Eligible family members include surviving spouses (including a remarried surviving spouse), children (including stepchildren, adopted children and children born out of wedlock), parents and siblings.

A provision of the 2010 Defense Authorization Act expands on the above authority, allowing the service secretaries to provide round-trip travel and transportation allowances to the same eligible relatives to attend a memorial service for the deceased at a location other than the location of the burial ceremony.

Honor guards. Military regulations authorize honor guards for funerals of all active-duty members, as well as reservists and National Guard members who die on active duty. At least two uniformed service members will serve on honor details for each military funeral as long as they are not needed for missions. At least one honor-detail member must be from the deceased member’s branch of service.

Veterans’ organizations will provide honor guards when uniformed service members are not available. An adjutant general’s office, duty officer or commander’s office at a local installation or reserve training center also can provide this service.

Housing. Immediate family members may continue receiving government housing or the Basic Allowance for Housing for up to one year after a service member dies. However, neither a death gratuity nor housing allowance will be paid to a dependent who kills a service member, “unless there is evidence which clearly absolves the dependent of any felonious intent,” according to military regulations.

Death benefits generally are tax-free.


Service members automatically are insured for $400,000 under the Servicemembers’ Group Life Insurance program, unless they elect a lower level of coverage or decline coverage.

SGLI is available in increments of $50,000, up to a maximum of $400,000. Premiums are 6.5 cents per month for $1,000 of coverage, or $26 per month for the maximum coverage of $400,000, plus an additional $1 per month for coverage of up to $100,000 for traumatic injuries. Premiums have not changed since 2008.

Premiums are deducted from paychecks automatically. To refuse coverage or to choose coverage at less than the maximum coverage, a member must make a written request.

The Defense Department also pays premiums for SGLI coverage up to the maximum of $400,000 for those serving in Operation Enduring Freedom, for as long as they are deployed in support of that operation.

Family SGLI. A service member can buy Family SGLI coverage for a spouse in $10,000 increments up to $100,000 or the amount of the member’s coverage, whichever is less. Monthly premiums for spouses are based on age. For the $100,000 maximum coverage, monthly premiums range from $5 for spouses under age 35 to $50 per month for spouses ages 60 and over.

In addition, each dependent child of a service member is automatically insured for $10,000 of free Family SGLI coverage.

Traumatic injury insurance. A traumatic injury protection program, an offshoot of SGLI, pays between $25,000 and $100,000 for severe injuries suffered by service members.

This insurance coverage applies to traumatic injuries regardless of where the injury occurs, on or off the job — even mowing the grass at home is included. Active-duty, National Guard and reserve members who have SGLI are insured automatically, for an additional premium cost of $1 per month. Because of its connection to the SGLI program, the traumatic injury insurance coverage is known as TSGLI.

Those who have SGLI cannot decline the injury coverage unless they also decline SGLI, nor can service members carry TSGLI without also carrying basic SGLI.

Examples of payment amounts include total loss of sight in both eyes, $100,000; loss of one foot at or above the ankle, $50,000.

The coverage is retroactive for service members who suffered qualifying losses from Oct. 7, 2001, to Nov. 30, 2005. Initially, this retroactive coverage was limited to injuries resulting from a traumatic event in Operation Iraqi Freedom or Operation Enduring Freedom; however, under a major policy change announced in September, retroactive coverage will apply to all qualifying injuries suffered by active-duty members anywhere in the world, even if the injuries are not service-related.

National Guard and reserve members also are eligible, even if their injuries happened off duty or in their civilian jobs, and regardless of whether they were seen at a military treatment facility for their injuries.

Retroactive payments are made regardless of whether service members had SGLI coverage at the time of their injury.

In late 2011, the program expanded to cover injuries to the genitals and urinary system, injuries that have been increasing in recent years as a result of the many insurgent attacks in Iraq and Afghanistan using improvised explosive devices. Payments for covered losses in that category range from $25,000 to $50,000 and, like other types of losses covered under TSGLI, are retroactive to Oct. 7, 2001.

If troops die of their wounds, their families may qualify for TSGLI payments, in addition to other death benefits, if the member survives for at least seven days after the traumatic event. This is also retroactive for those who served in Operation Iraqi Freedom or Operation Enduring Freedom.

Troops still on active duty, as well as those who have left the service, can qualify for the payment, which is paid on top of any other Veterans Affairs Department disability or pension benefits. To qualify, the injury must have been incurred before the service member separated from the military.

Contact: Servicemembers’ Group Life Insurance, 800-419-1473;

Veterans and retirees can buy insurance similar to SGLI after they leave service, but the premiums increase substantially as the person gets older. That plan is known as Veterans’ Group Life Insurance, or VGLI.

SGLI, TSGLI and VGLI payments are not taxable.


There is an active-duty variant of the military retiree Survivor Benefit Plan.

Spouse and/or child SBP coverage is automatic and free for all active-duty members who are eligible for retirement (at least 20 years of service) and die while still serving on active duty.

For a member who is not yet retirement-eligible, the death must be classified as in the line of duty for an annuity to be paid to the member’s survivors.

The immediately payable SBP annuity is 55 percent of the retired pay that the member would have received if he had been medically retired with a 100 percent disability rating on the date of death.

The active-duty SBP annuity is reduced dollar for dollar by any amount of dependency and indemnity compensation paid to the spouse of a deceased member by the Veterans Affairs Department, although this offset is partially reduced under a provision of the 2008 Defense Authorization Act.

(See Retirement)

SBP payments are not offset by any DIC payments to a deceased member’s children.

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