Military Retired Pay Overview

There are many financial considerations when planning for retirement
There are many financial considerations when planning for retirement

The military (active duty) retirement system is arguably the best retirement deal around. Unlike most retirement plans, the Armed Forces offer a pension (technically a "reduced compensation for reduced services.") with benefits, that start the day you retire, no matter how old you are. That means you could start collecting a regular retirement pension as early as 37 years old. What's more, that pension check can grow with a cost of living adjustment each year.

Note: The Reserve Component retirement pay system is somewhat different from the active duty. Go to the Military Reserve Component Retirement Pay Overview to learn more.

However there are many factors that determine exactly how much your pension will be. Over the past twenty five years, the government has made some significant changes to the military retirement system.

Determining Your Retirement Payment Rate

If you entered the service:

  • Prior to September 1980 you are eligible for the Final Pay retirement system.
  • Between September 8th, 1980 and August 1986 you are eligible for the High 36 system.
  • After August 1986 you are eligible to choose either the High 36 retirement system, or the Career Status Bonus/REDUX (CSB) retirement system. If you decline to make a choice you will automatically receive the High 36 retirement plan.

Click here to learn more about the different retirement plans that are currently available.

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