Retirement Pay
An officer's retired grade is governed by statutory regulations, in which certain responsibilities are delegated to Service Secretaries.
Federal Law
10 U.S. Code Chapter 71: With some exceptions, pay for retired officers is calculated as the product of 1) the retired pay base (RPB) and 2) a retired pay multiplier (RPM).
A service member's retired pay base (RPB) is determined based on the service member's date of entry.
- § 1406: RPB = final basic pay for service members with an entry date on or before 7 Sep 1980. Final basic pay is the monthly amount of basic pay the officer received immediately prior to retirement. § 1407: RPB = "high-three" for service members with an entry date on or after 8 Sep 1980. High-three is calculated by averaging the monthly basic pay of the 36 months that the officer was paid the highest amount.
§ 1409: A service member's retired pay multiplier (RPM) is determined based on the service member's years of creditable service (YCS), date of entry, date of retirement, and the Thrift Savings Plan (TSP) elections chosen by the service member. YCS is the number of years of service creditable to a member, prorated by the month for partial years of service.
Table 1.1: General Rules for Determining Retired Pay Multipliers
| Retirement Date | |||
|---|---|---|---|
| Date of Entry | TSP Election | on or before 12/31/2006 | on or after 1/1/2007 |
| On or before 12/31/1995 | ineligible for TSP | 2.5%*YCS (capped at 75%) | 2.5%*YCS |
| Between 1/1/1996 and 12/31/2017 | no TSP elected | 2.5%*YCS (capped at 75%) | 2.5%*YCS |
| Between 1/1/1996 and 12/31/2017 | TSP elected | 2.0%*YCS (capped at 60%) | 2.0%* YCS |
| On or after 1/1/2018 | TSP required | 2.0%*YCS (capped at 60%) | 2.0%* YCS |
10 U.S. Code § 12733: Total years of service for the purpose of determining retired pay for reserve members is calculated by dividing by 360 the sum of the following:
- Days of active service
- Days of full-time service while performing training duty or attending instruction at a service school
- 15 days plus days spent in attendance at a drill or instruction, with the following limits:
- 60 days for such service before Sept 23, 1996
- 75 days for such service before Oct 30, 2000
- 90 days for such service before Oct 30, 2007
- 130 days for such service after Oct 30, 2007- Days in which funeral honors duty was performed
- One day for each point earned for funeral duty
10 U.S. Code § 14706: In calculating a reserve officer's year of service for retirement pay calculation, the following shall not be counted:
- Time spent serving as a warrant officer
- Constructive credit awarded
- Service after appointment as commissioned officer that was spent obtaining required advanced education
DoD Policy
Follows U.S. law.
DODFMR 7000.14-R Volume 7B: summarizes payment options for retirees.
Air Force Policy
Implements U.S. Law and DoD Policy. See Table 1.1 above.
Army Policy
Implements U.S. Law and DoD Policy. See Table 1.1 above.
Navy Policy
Implements U.S. Law and DoD Policy. See Table 1.1 above.
Marine Corps Policy
Implements U.S. Law and DoD Policy. See Table 1.1 above. For more details, see MCO P1900.16 CH 2