Military retirement pay has gotten complicated with all the system changes, BRS confusion, and conflicting information about actual dollar amounts flying around. As someone who walked dozens of soldiers through their retirement calculations during my time as a career counselor, I learned everything there is to know about what you actually get paid after 20 years. Today, I will share it all with you.
### The Three Systems You Need to Know
First, which system applies to you matters more than anything else. Your entry date determines everything.
**Final Pay** is for the old-timers who came in before September 1980. You get 50% of your final base pay after 20 years, then 2.5% more for each additional year. Simple, straightforward, and honestly pretty generous compared to what came later.
**High-36** covers most current retirees—anyone who joined between September 1980 and December 2017. Your pension is 50% of the average of your highest 36 months of base pay. Those last three years of your career determine your retirement income for the rest of your life, which is why you see people angling for promotions right before retirement.
**Blended Retirement System** is the new kid on the block. If you came in January 2018 or later, or if you opted in from the old system, you’re getting 40% of your High-36 instead of 50%. But—and this is important—you also get TSP matching from the government, which can make up that difference if you contribute consistently.
Probably should have led with this section, honestly.
### Real Numbers from Real Retirements
Let’s talk actual dollars, because that’s what matters when you’re planning your future.
Say you’re an E-7 retiring under High-36, and your average of the highest 36 months is $5,000. Your monthly retirement check is $2,500. That’s $30,000 per year for the rest of your life, adjusting upward with cost of living increases.
Under BRS with the same $5,000 High-36 average? You’re getting $2,000 monthly from the pension. Seems like you’re losing out, right? But if you’ve been maxing your TSP contributions and getting that government match, your total retirement package can actually exceed the old system. It just requires discipline to contribute throughout your career.
I’ve watched too many junior enlisted skip TSP contributions because they needed money now, then regret it at retirement. That’s what makes military retirement endearing to us veterans—it forces us to think long-term in a culture that’s often focused on the immediate mission.
### The Benefits Nobody Calculates
The pension is what everyone focuses on, but honestly, the other benefits might be worth even more over a lifetime.
TRICARE for retirees is exceptional. My civilian friends pay $800-1,200 monthly for family health insurance. TRICARE Prime costs a fraction of that, with better coverage than most civilian plans. Over 30-40 years of retirement, we’re talking hundreds of thousands of dollars in healthcare savings.
Commissary privileges save my family about $200-300 monthly on groceries. Exchange access adds more savings on everything from electronics to clothing. These aren’t flashy benefits, but they compound year after year.
The VA benefits package is separate from DoD retirement but runs parallel. Disability compensation, if you qualify, adds to your retirement pay. I know plenty of retirees pulling both their pension and VA disability, significantly boosting their monthly income.
Space-A travel? Underrated. Free or near-free flights on military aircraft if you’re flexible with timing. My wife and I flew to Hawaii for under $100 round trip last year.
### Survivor Benefit Plan Deserves Attention
SBP costs you money up front—it’s deducted from your retirement pay. But it ensures your spouse continues receiving 55% of your pension after you’re gone.
I counseled a widow whose husband declined SBP to maximize his monthly check. When he died unexpectedly at 58, her income dropped to zero overnight. That pension was supporting their household, and suddenly it vanished. Meanwhile, my neighbor pays into SBP, and his wife has peace of mind knowing she’s covered.
### Planning Your Transition
Retirement planning isn’t just about the money, though the money matters enormously. It’s about preparing for life after the uniform.
Most retirees I know start a second career. That military pension provides a foundation that lets you take a lower-paying job you actually enjoy, or invest time in education to launch something new. Retiring at 42 with a guaranteed income changes your risk tolerance completely.
Financial planning should start years before retirement. Max out your TSP if you’re under BRS. Build an emergency fund. Consider what your civilian life actually costs—housing, transportation, healthcare (even with TRICARE), entertainment, travel.
Professional development matters too. Translate your military experience into civilian terms. Network before you need a job. Use those transition assistance programs even if they seem boring or irrelevant.
### The Reality Check
After 20 years, your retirement package is substantial. The pension alone might not make you wealthy, but combined with benefits, opportunities for second careers, and the option to start collecting at age 38-42, it’s a remarkable deal.
Your rank at retirement significantly impacts your monthly check. An E-5 retiree and an O-4 retiree have vastly different financial situations. But both have security that most civilians never achieve—a guaranteed monthly payment for life, comprehensive healthcare, and a community that stays connected.
Understanding your specific system, maximizing your High-36 months, contributing to TSP if applicable, and planning for transition—these actions determine whether retirement is comfortable or stressful. The system provides the framework, but you build your actual retirement through decisions made throughout your career.
