Table of Contents
- Overview of Military Retirement Qualifications
- Qualifying for Retirement as a Commissioned Officer
- Commissioned Officer Retirement Pay Grades
- Retiring at O-1 Through O-3
- Retiring at O-4 and Higher
- Retiring at a Lower Grade & Reduction in Rank
- Navy and Marine Corps Exceptions
- How to Prepare for Retirement as a Commissioned Officer
Qualifying for a military retirement plan can be complicated, especially when your service status changes throughout your career. Complicating factors can include changing branches of the military, transitioning between active duty and the Guard or Reserves, or earning your commission after starting your career as an enlisted member.
Commissioned officers typically earn more, which is why it could be more beneficial to retire as one.
Let’s examine the service requirements for retiring as a commissioned officer and possible exceptions to these rules. This can be a complicated topic, so it’s recommended to visit your Human Resources or Personnel office or even your base JAG if you have specific questions about your career or retirement eligibility.
*This article primarily applies to service members who were previously enlisted, then later earned their commission and remained in the service through retirement.
Overview of Military Retirement Qualifications
In most cases, active-duty military members must serve 20 years to be eligible for normal military retirement. However, there are some exceptions, including the Temporary Early Retirement Authority (TERA), which allows members to retire with as few as 15 years of service.
TERA is only offered when the military needs to selectively reduce the size of its force. It is generally only offered in specific branches and then only for targeted career fields and service classes (years of service).
The military also has medical retirements, which are pretty complex and often unique to the individual. It’s important to understand that retiring from active duty and retiring from the Guard or Reserves have different guidelines.
Qualifying for Retirement as a Commissioned Officer
To retire from active duty as a commissioned officer, you must have 20 total years of service and hold a commissioned officer title for at least 10 of those years. When authorized by the Secretary of Defense, the Secretary of your military branch can reduce the 10-year requirement to no less than eight years, though it is not as common. However, the overall 20-year requirement is usually a hard guideline unless you are authorized to retire early under TERA. (Source: Title 10 U.S. Code § 9311).
To retire from the National Guard or Reserves as a commissioned officer, you must have 20 qualifying years of service (Good Years) and be a commissioned officer at the time of retirement. If you have 20 years of service but are under the age of 60, you may be eligible for gray area retirement. (Source: 10 U.S. Code § 12731).
Notice there is no language requiring the member to have a certain number of years of commissioned service. Members retiring as officers in the Reserve Component simply need to meet the 20-year service requirement. Members may incur a service commitment when they commission, so they may be required to fulfill this prior to voluntarily retiring. There are also time-in-grade requirements to retire under a certain grade.
Commissioned Officer Retirement Pay Grades
Retirement pay is heavily determined by your pay grade. In addition to the service requirement minimums discussed above, there are also guidelines regarding the amount of time officers must spend at a certain rank to retire in that pay grade. That being said, some military officers want to serve over the minimum requirements to increase their rank.
Most military members retire by age 60. However, the DoD enforces a “mandatory” retirement age for commissioned officers outlined under Title 10 U.S. Code. Commissioned officers and warrant officers below general and flag grades may be able to serve until age 62, while general and flag officers are allowed to serve until the first day of the month following their 64th birthday. Officers in O-9 and O-10 positions may have retirement deferred until age 66 by the SECDEF or until age 68 by the President.
If you want to improve your rank before retirement, you must try and meet the pay grade minimums before you meet the mandatory retirement age. Officers should familiarize themselves with DOPMA and ROPMA rules to determine how long they can serve.
Retiring at O-1 Through O-3
To retire at the pay grade of O-1 through O-3, you generally must meet the retirement eligibility requirements listed above and have at least six months of satisfactory service at that grade.
Retiring at O-4 and Higher
To retire at a pay grade of O-4 through O-6, officers must have served on active duty in that grade for at least three years. However, the Secretary of Defense may authorize the Secretary of a military department to reduce this period to no less than two years.
There are additional rules regarding when the Secretary of Defense may authorize members to retire with less than three years’ time in grade, as well as a maximum number of individuals in each rank that can retire with fewer than three years’ time in grade in a given year.
Additional rules apply for retiring at the pay grade of O-7 through O-10. More information can be found here.
Retiring at a Lower Grade & Reduction in Rank
Officers retiring without the required time in service for the specific rank will be retired in the next lower grade in which they served satisfactorily for no less than six months.
It’s also possible to receive a reduction in grade for bad conduct, conduct unbecoming an officer, or for other administrative reasons. Speak with your JAG if that situation applies to you, as they will be able to provide personalized information specific to your case.
Navy and Marine Corps Exceptions
The U.S. Navy, and by extension, the U.S. Marine Corps, follows the federal law for retirement pay grade. However, they also have their own policy regarding retirement rank.
According to OPNAVINST 1811.3A, Navy Policy has the following Time in Grade requirements:
- O-1 and O-2: 6 months
- O-3 and O-4: 2 years (up to 18 months may be waived)
- O-5 and higher: 3 years, subject to waivers allowed by law
In other words, the only changes are for O-3 and O-4. Members retiring at O-3 must serve two years TIG instead of the minimum of six months required by law. Officers retiring at O-4 must serve only two years instead of the three required by federal law. However, COMNAVPERSCOM may waive up to 18 months of the two-year period for both O-3 and O-4 personnel.
In short, it’s important to review federal law, but you should also verify the policies of your branch of service.
How to Prepare for Retirement as a Commissioned Officer
Don’t let retirement sneak up on you. Make sure you know your service class, when you will be eligible to retire, and at which grade you should retire. Understanding these requirements can have a massive impact on your retirement pay.
Let’s review two common scenarios you should think about – particularly as you progress in your military career.
Scenario One: Passing Up Orders for Retirement
When you are in the latter stages of your career, you are often at the mercy of your functional or career advisor. They will often send you where the need is the greatest, whether or not it is a desirable career move or your preferred location. And since they know you need to follow orders to remain in the military, they have you in a tough spot.
This is where you need to decide whether or not to accept or decline the orders.
Accepting the orders means you pick up your life and move while declining your orders pretty much means game over for your military career. It’s actually not uncommon for military members to receive orders after they are eligible for retirement and decide they would rather retire than uproot their families for another cross-country or international move.
This is why understanding your service requirements is so important. If you are a prior-enlisted officer with 20 years of active duty service but fewer than 10 years as a commissioned officer retiring before you’ve met the requirement means accepting a big cut in pension. This is also applicable if you were recently promoted but haven’t met the Time in Grade requirements.
Only you can decide whether or not taking those orders is worth the additional income (and stress) that comes with accepting new orders. The key is to be aware of your options and the impact of accepting or declining.
Scenario Two: Involuntary Separation
In a perfect world, military members would be able to remain on duty until they are ready to move on. Unfortunately, that doesn’t always work, and the military does, from time to time, force people out of the military through involuntary separations and forced retirement.
For example, in 2014, the Army forced a group of prior enlisted active duty officers to retire with 20 years of service or under TERA rules. Unfortunately, while some of them were qualified to retire, several of them did not qualify to retire as an officer because they did not have 8 years of commissioned service (the Secretary of the Army had authorized commissioned officers with less than 10 years of service to retire as commissioned officers during this period).
In effect, these Soldiers had been rewarded with career advancement for their exceptional service. Then, they were later forced out due to Force Shaping requirements and were not allowed to retire as officers because they did not have the requisite service time.
As you might imagine, this did not go over well. Thankfully, enough attention was raised about this issue, and after a Congressional inquiry, the Army allowed the members to retire as officers.
Be Informed
As our good friend, GI Joe said, “Knowing is half the battle.”
This information can help you make important and valuable career decisions and help you avoid costly mistakes.
While scenario two is outside of your control, being aware of this situation gives you the information you need to file an appeal or work with your JAG to see if anything can be done to avoid missing out on the retirement benefits you have earned.
Photo Credit: Photo by Master Sgt. John Hughel. This work is in the Public Domain. The appearance of U.S. Department of Defense (DoD) visual information does not imply or constitute DoD endorsement.
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Gian says
Hello! I heavily contemplate applying for retirement within the next 2 years or sooner. This will put me at 20 years TIS (15 years active + 5 years reserves). I’m an O3E and in 2 years will also meet my 10th year as an officer.
(1)Will I qualify for reserve/non-regular retirement only since I won’t have 20 years AFS?
(2) If in 2 years & with 20 years TIS, I get medically retired (since it has been brought up to me by multiple providers but I have successfully dodged so far) from active duty with more than 50% disability, will I be entitled to active duty pension and/or CRDP?
I haven’t been able to find the answer to these questions. Neither the Army HR departments nor DFAS have been helpful so far.
Thank you in advance!
Ryan Guina says
Hello Gian,
(1) Yes, you will qualify for a Reserve retirement since you do not have 20 years of Total Active Federal Military Service (TAFMS). In most cases, your retirement pay will start at age 60, along with your healthcare benefits.
(2) My understanding is that a military medical retirement is the same as an active duty retirement, meaning you would receive benefits immediately upon retirement. Military medical retirement is based on your military disability rating, not your VA disability rating. You have to go through the military medical evaluation board, which can be a lengthy process. Your retirement pay would be based on the greater of your military disability rating multiplied by your high-36 base pay, or your years of service multiplied by your high-36 base pay (both are capped at 75% of your high-36). Those who receive medical retirement with 20 years of service and who have a 50% VA disability rating are eligible for Concurrent Retirement and Disability Pay (CRDP).
According to the DFAS website:
To be eligible to receive both military disability retired pay and VA Disability Compensation concurrently, a member who was retired under Chapter 61 for disability must:
Note: A member who was retired under Chapter 61 for disability and who did not have 20 years or more of service creditable under 10 U.S.C. § 1405, or 20 years of service computed under 10 U.S.C. § 12732 at the time of retirement, is not eligible to receive VA Disability Compensation and military disability retired pay concurrently. Therefore, such members are subject to the general rule that requires a dollar-for-dollar waiver of military retired pay in order to receive VA Disability Compensation.
Best wishes!
David L McDonald says
Ryan,
What law allows the Army to retire you as an enlisted even though you have 20 AFS of which 10+years were commissioned. I was reverted to enlisted at the end of my 20 AFS. There are settled Board of Correction cases that predate my retirement that support an enlisted at the end of 20+AFS YEARS who retire as OFFICERS
Yet I am on my 3rd Board and have been retired since 2012.
What are your thoughts?
My contact info:
Dave McDonald
[email protected]
Ryan Guina says
David, your situation is unique. I recommend working with a legal expert who specializes in military law. Best wishes!
Joseph Erskine says
The Navy enlisted retirement policy is different from all other services, please see the following link for understanding:
Fact Check: https://va.org/understanding-retainer-vs-retired/
An enlisted service member must have 30 years in order to be considered retired from active duty. If they serve 20 years plus but not the entire 30 years of active service, then they are transferred into the “Fleet Reserves,” which is an inactive reserve status.
Case in point, for me, I was enlisted, officer, back to enlisted for retirement purposes. I reverted back to my highest pay grade held (E-9), once I reached my full 30 years (active duty & fleet reserves) I was eligible to request for highest pay grade held…which was O-3E. Even though I did not complete the entire 10 years of commissioned officer (to retire), I was able to revert back to enlisted base upon the Navy Commissioned Officer program I was selected under…Limited Duty Officer…which our enlisted records remain open for a certain amount of time…in case the service member want’s to return back to their enlisted rank and rate. Once again this is Navy, all other services are different.
I suggest you call DFAS Tier 2 High Three Calculation Department: 216-204-0835, they can fact check your questions 1, 2, & 3. I know for sure they will be able to provide you the correct answers, I call often to get understanding of my situation.
Please review this DFAS site (if you haven’t yet): https://militarypay.defense.gov/Pay/Retirement/, this site will answer the different types of retirement scenarios…based on when you entered the service. May explain some of your concerns/questions.
The only other suggestion I may provide is to contact the Air Force Personnel Command (Active/Retirement).
I hope my 2 cents helps.
Doug Nordman says
You’re asking great questions, Raphael.
1. I’m not familiar with Air Force personnel policies, but if you voluntarily retire from active duty with less than 10 years of commissioned service then the Army and the Navy will consider your pension as though you’ve never been commissioned. Your pension would initially be based on High Three pay tables for an E-6. After a combined total of 30 years of service (active duty and retired) you’d be able to apply to the Air Force to “upgrade” to your officer pension, which will be based on your High Three officer pay.
2. I’m not sure what an MEB would do to your rank if you were retired on a disability pension, because you could be forced to retire involuntarily. In that situation, you’d be considered to have served satisfactorily after six months and the 10 years of commissioned service would probably be waived. You’d want to discuss this situation with a JAG and with PEBForum.com.
3. Going to the Guard as a commissioned officer until 10 years of commissioned service does count for the “10 years of commissioned service” pension requirement. However you might also be required to serve a Guard service commitment of at least six years, even in the IRR. In addition, if you retired awaiting pay from the Guard with your 20 years of active duty, you’d still receive a non-regular (Reserve) pension which would not start until age 60.
I normally get this question from servicemembers who’ve reached financial independence and want to give up the active-duty pension for a better quality of life, while knowing that they’ll still receive the Reserve pension at age 60.
4. The “higher grade after 30 years” regulation is in federal law. For Air Force servicemembers it’s Title 10 U.S. Code section 9344 “Higher grade after 30 years of service: warrant officers and enlisted members”:
https://www.law.cornell.edu/uscode/text/10/9344
This is why the other services feel comfortable with retiring officers (with less than 10 years’ commissioned service) on enlisted pensions regardless of their officer High Three pay. Perhaps the logic is that you’ve voluntarily retired and you’re willing to accept the lower pension until the point where you would have been involuntarily retired.
John says
In item #3 you mentioned “still receive a non-regular (Reserve) pension which would not start until age 60.” I have two follow-up questions:
Does this apply to AFRC transfers, i.e. I have 20 TIS but only 6 commissioned and am considering AFRC to complete 4 more years?
Would I ultimately be foregoing my High-3 until 60 y/o, versus suspending it until I finished my time in AFRC?
Raphael L says
Hello! This is the most insightful site I’ve seen about enlisted/officer retirements. Its so hard to find information on this so thank you!
I’ll explain my situation and then pose my questions. I joined the Air Force in January 2005. I commissioned in August 2018. All of this is Active Duty with no breaks in service.
1. If i retire in 2025 with only 6 years of commissioned service, how is my retirement pay calculated (High 3 as an officer or high 3 as my highest enlisted rank (E-6)?
2. If I get MEB’d after 2025 but before August 2028, would my retired pay be officer or enlisted (not concerned about disability pay and all that, just what rank is my retirement pay being calculated at).
3. If I join the guard after 2025 as an officer and stay until August 2028, would that count as my 10 years as a commissioned officer to receive officer retirement pay?
4. Finally, I’ve never heard of retirement pay increasing to highest rank served after 30 years. Where is the regulation for all this? I will happily do research on my own. Im jsut having trouble finding the reg i should be looking at.
Thank you!
Philip A. Smith says
I joined the USAF August 1981 and got out 1 May 1992. After 17 years, I was commissioned in the National Guard 20 May 2009. With one deployment to Iraq, I retired after an MRD extension on 31 May 2019 as an O-4 for two years. My MRD was Nov 2018. I thought I read in 2011 in an Army Reg. that a SM would get Final Pay if retired after MRD. Regulations were updated in 2015. I am not able to find what I thought I read now. Was I mistaken or did the new regulations cancel it out?
Mark M says
Thank you Doug! I will follow that advice.
Joseph Erskine says
Update: As of Aug 2020, I am in receipt of the following information from NPC PERS 912: (Mailed to me via USPS)
“Retirement Order and Authorization for Transfer from The Fleet Reserve to The Retired List
(Encl) DD Form 363 (Certificate of Retirement)
(Encl) Prior Higher Grade ltr (if eligible).
Please contact us for any further information you require.
Thank you,
MyNavy Career Center
833-330-6622”
Update: For PERS 835/Officer Retirement, ASC Yarbro, has been relieved by PSC Bishop. PSC is the original person in the billet…he was TDY on an IA, ASC Yarbro was filling the billet while PSC was out of pocket. You can contact PSC Bishop at 901-874-3183, https://www.public.navy.mil/bupers-npc/career/retirement/OfficerRetirements/Pages/default.aspx
Update: PSC Bishop is working on all current applications that were submitted while he was TDY on his IA. He is squared away, no issues with speaking with him on my situation…he will help you out. My application has moved forward and up the chain of command.
Note: If you have reached your 30 year mark while in Fleet Reserves and reverted back to enlisted from officer to retire. As you read above, the Prior Higher Grade Letter/application will be enclosed in your package (Retirement orders & DD Form 363). Follow the instructions and return to PERS 835, PSC Bishop or whomever is sitting in the chair at the time.
Note: At the time of my inquiry (June 2018) about receiving my 30 year certificate…in order to get the application for the Prior Higher Grade, you had to wait to receive the 30 year certificate package …at that current time PERS 912 was backlogged in sending out the 30 year packages. I was fortunate enough to be referred to PERS 835, ASC Yarbro (at the time) and he sent me the application via email. Kept me from having to depend on PERS 912 to send me the package at a TBD date in the future. I stated all above because…if you don’t get your 30 year certificate package in a timely manner, just call PERS 835 separately and have PSC Bishop to send you the application via email.
Update: In March 2020 NPC transitioned to a new ticketing system which is now linked to DEERS for personal data updates. When I called (Jul 2020) to get an update, not knowing the latter…All of my old case numbers from the old ticketing system (prior to March 2020)…the NPC reps could not recall the old case numbers. I had to start all over again as if it was my first time calling, even though I had been waiting since June 2018 when I reached my 30 year marked.
Note: Please ensure you verify your personal data: mailing address, phone, email, and SSN…the old system was not connected to DEERS…the new one is, any changes you may need to make please do so via DEERS or use DFAS MYPAY to make changes such as email and/or mailing address…It will save you frustrations, trust me.
Bottom Line: The new system has seem to be efficient…after waiting two years for my 30 year certificate and higher pay grade advancement…I’m finally getting traction…I have no more worries.
Note: If you have any questions on pay matters (High 3/Retirement advancement pay), NPC reps will tell you to contact DFAS. Please see below information for DFAS Tier 2 High Three Calculation Department:
DFAS Direct Number: 216-204-0835
Please call the number above only….it goes directly to Tier 2 High Three Calculation Department…if you try any of the other DFAS numbers…you will be on the phone for hours and be transferred to multiple departments until you are finally directed to Tier 2 High Three…Trust me!
Doug Nordman says
Philip, I’m a Final Pay retiree who’s tracked the system over the years, and I’ve never ever run across that. It’s definitely not in federal law or the DoD Financial Management Regulation.
In 1999 there were changes to the old High Three/REDUX pension system (reverting to a higher pension multiple and bringing in the Career Status Bonus). There have been various TERA initiatives over the last 30 years and waivers for the length of commissioned service, including the drawdown legislation during 2010-2018. However I’ve never heard of any DoD initiatives to bring back Final Pay.
Your pension should be based on the system under which you started your service: the average of the highest 36 months of pay for the pay tables in effect when you begin your pension. Depending on the dates of your Iraq deployment, you may be able to start your pension three months early for every 90 days in a fiscal year that you’re deployed to a combat zone. Please let me know if you have more questions about that and we’ll dig into the dates & point counts.