Reserve retirement is sometimes called non-regular retirement. Members who accumulate 20 or more years of qualifying service are eligible for reserve retirement when they reach age 60 or, in some cases, a lesser qualifying age. There are two non-disability retirement plans currently in effect for reserve qualified retirees. These are Final Pay plan, High-36 Month Average plan. There is no REDUX retirement plan under non-regular (reserve) retirement.

The basic retirement formula is:

Retired Pay Base X Multiplier %

Final Pay Plan

The retired pay base for a qualified reserve retirement under the Final Pay plan is the monthly basic pay determined at the rates applicable on the day of retirement at the highest grade satisfactorily held during service. In other words, it is the rate of pay for the member's pay grade and years of service taken from the pay table in effect on the date that retired pay begins, regardless of when the member stopped participation (i.e. went into the gray area).

The Final Pay plan uses a multiplier % that is 2½% times the years of creditable service. The creditable years of service for a reserve retirement calculation is determined by the sum of all accumulated reserve points divided by 360.

High-36 Plan

The retired pay base for a qualified reserve retirement under the High-36 retirement plan is the total amount of monthly basic pay to which the member was entitled during the member's high-36 months divided by 36. This includes months to which the member would have been entitled if the member had served on active duty during the entire period. Usually this will be the average of the 36 months for the member's pay grade and years of service taken from the pay tables in effect for the 36 months immediately preceding the date that retired pay begins, regardless of when the member stopped participation (i.e. went into the gray area).

The High-36 retirement plan uses a multiplier % that is the same as the final pay plan.

Years of Service

There are 3 categories for determining years of creditable service that have applicability to the computation of reserve (non-regular) retired pay. One for determining when an individual is entitled to retired pay, one for determining the applicable active duty base pay upon which to compute retired pay, and one for determining the retired pay percentage multiplier. For reserve retirements these are generally different.

The first category we shall call- Years of Service for Retirement Entitlement. This category of years of service includes each one year period in which the person has been credited with at least 50 points, as follows:

  • 1 point for each day of active service
  • 1 point for each attendance at a drill period
  • 1 point for each day of performing funeral honors duty
  • 15 points for each year of membership in a reserve component

Generally, a member retiring with a Reserve (non-regular) retirement must have 20 years of service for entitlement and they will receive a letter from their Service advising when this criteria has been met.

The second category we shall call- Years of Service for Pay Base. When combined with pay grade, YOS for pay base, determines the active duty pay entitlement by defining the appropriate pay table cell, e.g. E-4 over 6 years of service. This category of years of service includes all periods of active service and all periods of Reserve or National Guard service counted day for day. A unique feature of Reserve retirement is that the pay base is determined as though the reserve member were serving on active duty immediately prior to retirement, thus the years of service continue to accumulate even after the member has entered the retired reserve and continue until they actually begin receiving such pay (usually age 60).

The third category we shall call- Years of Service for Retired Pay Percentage Multiple. YOS for retirement percentage multiple determines the years of service for computing the retired pay multiplier. This category of years of service includes all periods of active service (counted as one point for each day) plus all points earned through qualifying reserve duty, not exceeding annual limits, divided by 360.

Retirement Age

A member is generally not eligible for Reserve (non-regular) retired pay until they reach age 6o. However, any member of the Ready Reserve who is recalled to active duty or, in response to a national emergency, is called to certain active service after January 28, 2008, shall have the age 60 requirement reduced by 3 months for each cumulative period of 90 days so performed in any fiscal year after that date.

Application

Members eligible for Reserve retirement must request retired pay from the military department in which they last served. Payment is not made until requested.