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- Military retirement pay is calculated based on the following factors12345:
- Multiply your final base pay by 2.5% for each year of service to determine the retired pay base.
- Add cost of living adjustments (COLA) to account for inflation.
- There are two methods for determining the retired pay base: the final pay method (equal to final basic pay) and the high-36 month average method (average of highest 36 months of basic pay divided by 36).
- Active-duty Soldiers can start pension payments at any age after serving 20 years, which are usually about 40% of their highest basic pay while serving.
Learn more:✕This summary was generated using AI based on multiple online sources. To view the original source information, use the "Learn more" links.Retirement pay is calculated by multiplying your final base pay by 2.5% for each year of service. For example, a 20-year service member would receive 50% of their final base pay. Add cost of living adjustments (COLA) to get the total amount. COLA is based on the Consumer Price Index to keep pace with inflation.www.militarymoney.com/pay/retired-military-pay/There are two methods for determining the retired pay base. They are the final pay method and the high-36 month average method. The final pay method, as the name implies, establishes the retired pay base equal to final basic pay. The high-36 method is the average of the highest 36 months of basic pay divided by 36.militarypay.defense.gov/Pay/Retirement/There are three non-disability retirement plans currently in effect for active duty retirees. These are Final Pay plan, High-36 Month Average plan, and Military Retirement Reform Act of 1986 (more commonly referred to as REDUX) plan. The basic retirement formula is: Retired Pay Base X Multiplier %militarypay.defense.gov/Pay/Retirement/ActiveDuty…A pension plan pays you a steady paycheck for the rest of your life after you retire from service in the U.S. Army. Serve 20 years to receive an Army pension. After retiring, active-duty Soldiers can start pension payments at any age they choose—which are usually about 40% of your highest basic pay while serving.www.goarmy.com/benefits/veterans/retirement- their creditable years of service multiplied by their multiplier (either 2.0% or 2.5%), or
- the member’s military disability percentage multiplied by the retirement plan they fall under (Final Pay, High-36, etc.).
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