Primer on Military Retirement

Valuing loss of pay and retirement benefits for current and former military personnel has a significant potential impact on the work of forensic economists. Cases involving personal injury, wrongful death, and divorce necessitate an understanding of the determination of military pay and retirement benefits. There are approximately 2.5 million members on either active duty or in the ready reserve from all branches of the military. Another 2 million are classified as Department of Defense retirees. These include those who retired from active duty or from the reserves, those entitled to survivor benefits, and those who receive disability benefits. This paper provides a source of information for military pay and retirement benefits. Each is discussed by rank and date of initial entry into the military. Benefits for current and ex-spouse(s) and other dependents are discussed, as are coordinated disability benefits between the Department of Veterans Affairs and the Department of Defense.