Defense Primer: Military Retirement [Updated December 29, 2021]   [open pdf - 587KB]

From the Document: "The military retirement system is a government-funded system that provides a defined benefit to all retirees and matching government contributions to the Thrift Savings Plan (TSP) for eligible servicemembers. It has historically been viewed as a significant retention incentive for military personnel. The system includes monthly compensation for qualified active and reserve retirees, disability benefits for those deemed medically unfit to serve, and a survivor annuity program for the eligible survivors of deceased retirees. The amount of compensation depends on years of service (YOS), basic pay at retirement, and annual Cost-of-Living-Adjustments (COLAs). [...] The non-disability military retirement system for active-duty members has evolved since the late 1800s to meet four main goals. [1] To keep the military forces of the United States young and vigorous and ensure promotion opportunities for younger members. [2] To enable the armed forces to remain competitive with private-sector employers and the federal Civil Service. [3] To provide a reserve pool of experienced military manpower as a 'retired reserve' that can be recalled to active duty in time of war or national emergency. [4] To provide economic security for former members of the armed forces during their old age."