Calculate Retirement Pay

• 1). Determine the amount of equivalent active duty service using the military retirement formula. Start with the current number of creditable retirement points, which is provided to each member of the military in an annual statement. Divide these retirement points by 360. The result is the equivalent number of years served. An amount of 3,000 reserve points, for example, is equivalent to 8.33 years of full-time military service.
  
  
• 2). Find the official date of initial entry into the military. This is called the "DIEMS Date," and can be found on enlistment documents or in a military personnel file. If this date is prior to Sept. 8, 1980, simply multiply 2.5 by the number of equivalent years found in the first step. This answer indicates the percentage of final basic pay, up to 75 percent, that will be provided for retirement. For instance, a member with 8.33 equivalent service years will receive 20.8 percent of their standard pay during retirement. If the standard pay at the time of retirement was $2,000 a month, the retiree can expect $416 a month.
  
  
• 3). Use the updated retirement calculations, called the "High-3 Formula," if the date of official entry into the military was after or on the same day as Sept. 8, 1980. For this formula, multiply 2.5 by the number of equivalent service years. The result is used as a percentage, with a maximum value of 75 percent. Take this answer and multiply it by the average pay amount from the last three years. For example, a member with 8.33 equivalent years of service who made an average of $1,800 a month over the last three years will receive a retirement payout of $374 monthly.