Work out what a military pension is actually worth, for active duty, National Guard, and Reserve careers. Retired pay is the high-36 average of basic pay multiplied by 2.5% a year under High-3 or 2.0% a year under the Blended Retirement System, so 20 years pays 50% or 40% respectively. Guard and Reserve retirements are earned in points rather than years: 20 qualifying years of at least 50 points each, with total career points divided by 360 setting the multiplier, and pay starting at age 60 less three months for each aggregate 90 days of qualifying active service performed after 28 January 2008. Covers the CSB/REDUX penalty and its recomputation at age 62, the BRS lump-sum election, and the difference between transferring to the Retired Reserve and taking a discharge.
Which system you are under is set by when you entered service, not by choice: anyone who joined from 1 January 2018 is under BRS, and those who joined before had a one-time election window that has closed. The 0.5%-per-year difference in multiplier is the trade for BRS's TSP matching, which High-3 members do not receive — so comparing the two on pension alone understates BRS by whatever the matched contributions compound to.
Retired pay is taxable federally, though many states exempt it entirely or in part. It rises with COLA each year, which is what makes a pension worth substantially more than an equivalent lump sum over a long retirement. The BRS lump-sum election trades 25% or 50% of pension payments before full retirement age for a discounted payment up front, at a discount rate that has generally made it a poor deal.
Retired pay is your retired pay base multiplied by a percentage set by your years of service. Under High-3 (formally High-36) the base is the average of your highest 36 months of basic pay, and the multiplier is 2.5% for each year served — so 20 years pays 50% of that average. Under the Blended Retirement System the base is the same but the multiplier is 2.0% a year, so 20 years pays 40%. Only basic pay counts: BAH, BAS, special and incentive pays, and bonuses are all excluded. The detail most calculators get wrong is the base. Your high-36 averages the last three years of pay tables, not just this year's, and the older two are always lower. An E-7 retiring at 20 years in 2026 has a high-36 base of roughly $5,767 a month rather than the $6,245.70 the 2026 table shows at that grade — multiplying the current table by the multiplier overstates the pension every time.
Your DIEMS — the date you first entered military service, not the date of your current contract — decides it, and it is not a choice you get to make now. DIEMS on or after 1 January 2018: the Blended Retirement System, automatically., DIEMS between 8 September 1980 and 31 December 2017: High-3, unless you opted into BRS during the 2018 window or took the Career Status Bonus at 15 years., Took the $30,000 Career Status Bonus: CSB/REDUX. That election closed on 31 December 2017 and cannot be made now., DIEMS before 8 September 1980: Final Pay, which this calculator does not compute..
A reserve pension is earned in points rather than years. You need 20 qualifying years — years in which you earned at least 50 points — and your multiplier comes from your total career points divided by 360. A typical drilling year of 48 drill periods, 15 annual training days, and 15 membership points is 78 points, so twenty such years is about 4.3 equivalent years of service, not 20. Pay normally starts at age 60. Qualifying active service performed after 28 January 2008 pulls that down by three months for each aggregate 90 days, but the days only aggregate inside a single fiscal year — two 60-day mobilisations either side of 30 September earn nothing, while the same 120 days inside one fiscal year earn three months. The reduction stops at age 50, and TRICARE eligibility still begins at 60 regardless.
Inactive-duty points — drill periods, correspondence courses, funeral honours, and your 15 membership points — are capped each anniversary year. The cap is currently 130 and applies to years ending on or after 30 October 2007; before that it was 90, and earlier still 75 and 60. Active duty, annual training, and mobilisation days are never capped, and a year can never credit more points than it has days. Membership points count against that cap alongside your drills, which is the part most point calculators miss. If you drill 120 periods and add 15 membership points, that is 135 against a 130 cap, and 5 points are lost.
Under High-3, an E-7 retiring at exactly 20 years in 2026 receives 50% of a high-36 base of roughly $5,767 a month — about $2,883 a month, or $34,600 a year, before any COLA. Under BRS the same career pays 40%, about $2,306 a month, with the difference notionally made up by TSP matching over the career. Those figures move with your actual promotion dates. Pinning on E-7 three years before retirement rather than eight changes the high-36 base substantially, which is why this calculator asks for your timeline instead of assuming one.
BRS lets you trade 25% or 50% of your retired pay between retirement and age 67 for a single payment up front, after which your full pension resumes. The payment is the present value of what you give up, discounted at a rate DoD publishes annually — 6.46% for 2026. That rate is well above what most people earn on invested savings, which is the whole point: a high discount rate makes the lump sum smaller. In nominal terms you almost always give up more than you receive, because you are selling inflation-protected lifetime income for a fixed sum. The calculator shows both numbers side by side so the trade is visible rather than implied.
For anyone with 20 qualifying years, transferring to the Retired Reserve is usually worth a great deal more. Your years of service for pay keep running through the gray area between your last drill and age 60, and your retired pay base is computed against the pay tables in force when pay actually starts. A discharge freezes both on the day you leave. Two members with identical point records can retire on materially different pay for this reason alone. The calculator models both paths so you can see the gap for your own record before deciding.
CSB/REDUX costs you one percentage point of multiplier for every year short of 30 — 40% at 20 years instead of 50% — and your COLA runs one point below inflation. At 62 there is a one-time recomputation: your multiplier is restored to the full 2.5% a year and your COLA is caught up as though it had never been reduced. From 63 onward the reduced COLA resumes, so the gap starts widening again. That recomputation is a genuine step up in income and is easy to overlook when comparing REDUX against High-3. This calculator marks the year it happens in the year-by-year table.
The statutory rules — multipliers, creditable service, point caps, the age-60 reduction, the REDUX recomputation, and the lump-sum discounting — are implemented from the governing law and covered by tests. Basic pay comes from the published DFAS tables, and prior years are derived by applying each year's statutory raise, which is how DFAS builds them. What no calculator can know is the future: pay raises, COLA, inflation, your actual promotion dates, and how long you serve. Those are assumptions you control here. Treat the output as a planning estimate — DFAS computes your official figure at retirement, and your finance office is the authority on your own record.