Military retirement calculator is an online tool that helps military people to calculate the basic parameters of their retirement. Military people usually have significantly different plans than ordinary people; therefore they need special military retirement calculator to make planning for the retirement. What makes military personnel special and so different from others is that they usually retire much earlier than ordinary people and become eligible to receiving pension sooner than others.
After retirement military men are offered to choose among three retirement plans. To be more specific based on the date of joining military service it is determined between which retirement plans can individual choose. The joining date determines if an individual has option to choose among different pension plans, or he/she has to accept certain plan without alternatives. It is noteworthy that retirement plans are available to those individuals, who have served on active duty for more than 20 years.
There are three types of retirement systems and therefore three types of military retirement calculators:
- Final Pay: this plan is assigned to individuals that started their service in the military before September 8, 1980. In this case what you need to enter in military retirement calculator are expected retirement grade, number years served at the military, individual’s age. Consequently the tool gives back projected retirement pay. This plan may also take into consideration the inflation, tax rate and other variables;
- High-3 Year Average: this plan is applicable to those who started their service between the period September 8, 1980 – August 1, 1986 or after August 1, 1986 (without requesting “career status bonus”. As in the case of Final Pay plan additional variables can be added, such as the inflation and the tax rate;
- Redux (Career Status Bonus): this plan is available to those individuals that entered into service after July 31, 1986. This plan offers career status bonus and decreased pension. In this case people have option to choose to accept High-3 Year Average plan or Redux plan. Here military retirement calculator plays a big role showing which plan is more beneficial.
Actual pension paid under Final Pay and High 3 Year Average plans is increased based on the consumer price index (CPI). The Redux plan is also protected from inflation, but at lower percentage than for other pension systems.
In each of these three cases different military retirement calculators are used to arrive to correct figures. In each case input variables are slightly different that makes each plan different.