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How to Calculate Military Retirement? Things You Should Know!

Written by Everett Bledsoe / Fact checked by Brain Bartell

how to calculate military retirement

Veterans and military retirees are entitled to pay, pensions, and compensation rates. However, these can be a bit confusing to comprehend and calculate. If you have just retired or separated from the military, it is important that you know how to calculate military retirement. So, learn everything you need to know from our article here.

Military Pay, Pensions, and Compensation Rates


Before we address the central question “How to calculate military retirement?”, let’s look at the basic information about different pay, pensions, and compensation rates you may be eligible for.

1. Military Pay

There are 2 types of military pay: active duty and reserve.

The latter’s amount varies depending on whether you are an enlisted member or an officer. Your specific pay grade and the number of years in service will also factor into how much you receive as military active duty pay.

The range of pay grade are as follows:

  • E1 to E9
  • W1 to W5
  • O1E to O3E
  • O1 to O10

The range for enlisted members (active duty) is $1,785 to $8752, while it is ~$5,718 to $10,856 for warrant officers. Commissioned officers, in general, can receive from $4,260 to $16,608.

Same as active duty members, Reserves’ pay varies depending on if you are a commissioned officer, an enlisted officer, or a warrant officer.

For commissioned officers (general) from pay grade O1 to O10, the pay is from $112.86 to $553.61, while commissioned officers with over four years in service from pay grade O1E to O3E can get anywhere between $142.02 and $261.30.

Warrant officers with from pay grade W1 to W5, the pay is between $110.31 and $361.88 whereas enlisted members E1 to E9’s range is a lot lower, only from $55.01 to $291.75.

In addition, as with active duty retirees, Reserves retirees’ pay is affected by the specific number of years in service.

2. Military Pensions

There are two systems in place: the new Blended Retirement System (BRS) and the Legacy High 3 or High 36 System.

The Blended Retirement System (BRS) is an opt-in system that offers a Matching Thrift Savings Plan Contribution, Mid-Career Retention Bonuses, Monthly Annuity (For life after 20 service years).

The Legacy High 3 or High 36 System applies to those who have started serving by December 31, 2017. Like the BRS, you will get a Lifetime Monthly Annuity if you have served for over 20 years. Plus, you can take into account Thrift Savings Plans contributions, though they are not matched by the government.

Note: You can get social security benefits alongside military pensions. Thus, your social security benefits will not be reduced because of your military pensions.

Your age and earnings will determine the amount you receive as social security benefits. This is how it works:

  • You earn credits by working and paying social security taxes
  • You get one credit for every $1,470 of earnings (2021)
  • You can get a maximum of four credits every year.
  • Every year, the minimum amount of earnings required to get one credit increases.
  • You qualify for benefits once you achieve the necessary number of credits.
  • The number of credits needed is based on your age and the type of benefit.

To apply for social security benefits, you will need to provide proof of your military services, such as the DD Form 214, or records of your Reserve or National Guard service.

For more detailed information, check out this official website or dial 1-800-772-1213.

3. Compensation Rates

You can get compensation rates if you have sustained a service-related disability. It is a monthly, tax-free pay! How much you receive depends on a variety of factors, like the degree of your injury or illness. The rates are pretty much case-by-case. So, visit this official website for detailed info.

You can also get compensation rates if you are a low-income wartime veteran or a “survivor” of a low-income wartime veteran. The rates will be monthly payments from the VA and based on the recipient’s specific financial need.

Note: Eligibility will be based on age and veteran status (including service time, financial need).

If you are qualified to receive these rates, you are likely to qualify for the Aid and Attendance or Housebound Benefits, as well.



You should prepare your financial documents, records and grab your laptop and calculator. You can also keep your phone handy (in case you need to phone others for help).

1. Military Pay

Note: If you have trouble navigating the military retirement pay chart, use the following contact information to ask for help:

  • 1-888-332-7411 (Army, Air Force, Navy, Marine Corps, Space Force Retirees)
  • 1-866-772-8724 (Coast Guard Retirees)
  • 1-800-321-1080 (Survivor, Beneficiary)
  • Pensions

BRS System:

The annuity is 2% per year served, while the legacy retirement annuity is 2 ½% per year served.

If you are under the BRS pension system, you can also use this tool to do your military pension calculation.

High 36 System:

How much you receive is based on your years of service. It is 2.5% times your highest 36 months of basic pay. If you are under the High-36 pension system, you can use this tool to help with the calculations.

2. Compensation Rates

The amount you receive is the difference between your countable income and the limit that the Congress sets, which is called the Maximum Annual Pension Rate (MAPR).

Note: Countable income includes your social security benefits, retirement payments, investment returns, and any other income your dependents have. But medical expenses not covered by your insurance may be deducted.

MARP is the maximum amount of pension that can be paid. It is dependent on many factors:

  • The number of dependents you have
  • Whether you are married to another veteran (who qualifies for a pension)
  • Whether you have disabilities and they qualify you for Aid and Attendance/Housebound benefits.

For every additional dependent, $2,523 will be added to your MAPR. If your child works, you can leave out wages up to $12,950. This also applies to two married veterans, which will get MAPR as follows:

There is a net worth cap on eligibility. From December 1, 2021 to November 30, 2022 the limit to qualify for veterans pensions is $138,489. This takes into account your and your spouse’s assets and annual income.

Note: Assets are stocks and bonds, furniture, boats not main house/car, or household appliances, while annual incomes are fixed salary, bonuses, commissions, overtime pay, and tips.

But do not try to trick the system!

If you have transferred assets within three years before filing an application for a pension and the assets transferred are for less than the fair market values that would have caused you to exceed the net worth cap ($138,489), your pension eligibility will be stripped off for five years.


You have learned all the essential information for army retirement pay and army pension as well as air force retirement pay, alongside other military branches. Hence, “How do I use the military retirement calculator?” should no longer be a difficult question to tackle. Now, get calculating!

We know this can be an incredibly challenging process. Thus, if you have successfully calculated your retirement, share the experience with us. We will give you your well-deserved pat on the back (or a round of applause)!

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