Military High Three Retirement Calculator

Military High-3 Retirement Pay Calculator

function calculateHighThreeRetirement() { var yearsOfService = parseFloat(document.getElementById('yearsOfService').value); var highThreeAvgBasicPay = parseFloat(document.getElementById('highThreeAvgBasicPay').value); var resultDiv = document.getElementById('retirementResult'); if (isNaN(yearsOfService) || isNaN(highThreeAvgBasicPay) || yearsOfService < 0 || highThreeAvgBasicPay < 0) { resultDiv.innerHTML = 'Please enter valid positive numbers for all fields.'; return; } // The High-3 system calculates retirement pay based on 2.5% of the average basic pay for each year of service. var retirementMultiplier = yearsOfService * 0.025; var estimatedMonthlyRetirementPay = retirementMultiplier * highThreeAvgBasicPay; resultDiv.innerHTML = '

Estimated Monthly Retirement Pay:

' + '$' + estimatedMonthlyRetirementPay.toFixed(2).replace(/\B(?=(\d{3})+(?!\d))/g, ",") + " + '(Based on ' + (retirementMultiplier * 100).toFixed(1) + '% of your High-3 average basic pay)'; }

Understanding the Military High-3 Retirement System

The Military High-3 retirement system is a cornerstone of retirement planning for many service members. It determines your monthly retirement pay based on a specific formula that considers your years of service and your highest average basic pay over a 36-month period.

Who Does High-3 Apply To?

Generally, the High-3 system applies to service members who entered the military on or after September 8, 1980, and before January 1, 2018. Those who entered on or after January 1, 2018, fall under the Blended Retirement System (BRS), though some legacy members may have opted into BRS.

How the High-3 Calculation Works

The core of the High-3 calculation is straightforward:

Monthly Retirement Pay = (Years of Service × 2.5%) × Average of Highest 36 Months Basic Pay

• Years of Service: This is your total creditable years of active duty service. For example, 20 years of service would result in a 50% multiplier (20 * 2.5% = 50%). 30 years of service would result in a 75% multiplier.
• Average of Highest 36 Months Basic Pay: This is the average of your highest 36 months (3 years) of basic pay. This typically occurs at the end of your career when you've reached higher ranks and pay grades. It's important to note that this only includes basic pay, not allowances like BAH (Basic Allowance for Housing) or BAS (Basic Allowance for Subsistence).

Example Scenario:

Let's say a service member retires with 22 years of service, and their average basic pay over their highest 36 months was $5,000.

• Years of Service: 22
• Multiplier: 22 * 2.5% = 55% (or 0.55)
• Average High-3 Basic Pay: $5,000
• Estimated Monthly Retirement Pay: 0.55 * $5,000 = $2,750

This calculator helps you quickly estimate your potential monthly retirement pay under this system by inputting your specific years of service and your estimated highest 36 months of basic pay.

Important Considerations:

• Cost of Living Adjustments (COLAs): Military retirement pay is subject to annual COLAs, which help maintain purchasing power over time.
• Taxes: Retirement pay is generally taxable income, though state tax laws vary regarding military retirement.
• Survivor Benefit Plan (SBP): Retirees can elect to participate in SBP to provide an annuity to their eligible survivors, which reduces their gross retirement pay.
• Other Benefits: Retirement also comes with other benefits, such as TRICARE health care for life.

This calculator provides an estimate and should not be considered financial advice. For personalized planning, consult with a financial advisor specializing in military benefits or a representative from your service's retirement services office.