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Navy Active Duty to Reserves

devilbones

Arashikage トーマス・嵐影
I’ve done the math and it’s not great. Even with 1:5 mobs of 9 mo each, you don’t end up with a big pension check. You need to do 6-12 mo of ADOS a handful of times on top of those mobs to really make a dent. I am personally shooting for $5k monthly in retirement. Who knows what $5k will be worth when I’m 60, but it’s at least something.
How many points/years do you think this would be?
 

Hair Warrior

Well-Known Member
Contributor
Ok, so there are a LOT of assumptions baked in here specific to the person and their moment in time, but for ballpark’s sake:
  • Old retirement system
  • Commissioned at ENS/ no constructive entry credit
  • Serves exactly 20 yrs
  • Pins on O4 at yr 11 and O5 at yr 17
  • 2,537 total pts at retirement
2020 monthly basic pay for O5 w/ 20 yrs: $14,161.23

(Now, if you can correctly predict what that will be in year 20XX when you retire, you are a great economist.)

Monthly pension based on 2020 pay scales, w/ 2,537 retirement pts: $2,494.93, or $0.98 per month per point

Annually that’s $29,939.19

The 2021 social security max benefit is $3,895 per month, or $46,740 annually. Stack that to your USNR pension and you come out with $76,679 annually.

Now go find one or two rental properties (sooner rather than later) and pay off all of your various mortgages by retirement age, and you can easily clear $100k a year in retirement not doing a damn thing.

The big question though about retirement will be, will you have to ask for your bread in Mandarin or Russian while you’re waiting in the bread line?
 

Randy Daytona

Cold War Relic
pilot
Super Moderator
Ok, so there are a LOT of assumptions baked in here specific to the person and their moment in time, but for ballpark’s sake:
  • Old retirement system
  • Commissioned at ENS/ no constructive entry credit
  • Serves exactly 20 yrs
  • Pins on O4 at yr 11 and O5 at yr 17
  • 2,537 total pts at retirement
2020 monthly basic pay for O5 w/ 20 yrs: $14,161.23

(Now, if you can correctly predict what that will be in year 20XX when you retire, you are a great economist.)

Monthly pension based on 2020 pay scales, w/ 2,537 retirement pts: $2,494.93, or $0.98 per month per point

Annually that’s $29,939.19

The 2021 social security max benefit is $3,895 per month, or $46,740 annually. Stack that to your USNR pension and you come out with $76,679 annually.

Now go find one or two rental properties (sooner rather than later) and pay off all of your various mortgages by retirement age, and you can easily clear $100k a year in retirement not doing a damn thing.

The big question though about retirement will be, will you have to ask for your bread in Mandarin or Russian while you’re waiting in the bread line?

You need to check your 2020 payscale. Base pay for an O-5 at 28 years is $9816.60
 

Hair Warrior

Well-Known Member
Contributor
You need to check your 2020 payscale. Base pay for an O-5 at 28 years is $9816.60
Shit, you’re right. I had $9,530 as actual and the $14k amount was what I plugged in as a future monthly O5 basic pay amount assuming some inflation-adjusting increases compounded over a decade or more.

So yeah, if we’re using today-actuals, the monthly for O5 at 20 yrs and 2,500-ish pts is about $1,600 a month, or $20k a year roughly. It’s even less if you top out at O4 but still push to 20.
 

devilbones

Arashikage トーマス・嵐影
Shit, you’re right. I had $9,530 as actual and the $14k amount was what I plugged in as a future monthly O5 basic pay amount assuming some inflation-adjusting increases compounded over a decade or more.

So yeah, if we’re using today-actuals, the monthly for O5 at 20 yrs and 2,500-ish pts is about $1,600 a month, or $20k a year roughly. It’s even less if you top out at O4 but still push to 20.
Thanks for showing the math on that. I know I will be good with points, I have 2400 already/ 10 years TIS. I don't think I will be able to make O5 before 20 years though, but who knows.
 

Hair Warrior

Well-Known Member
Contributor
Thanks for showing the math on that. I know I will be good with points, I have 2400 already/ 10 years TIS. I don't think I will be able to make O5 before 20 years though, but who knows.
New spreadsheet numbers this AM:

If you retired today with exactly 20 years of service, your monthly pension per point is approx $0.68 retiring as an O5, or $0.60 retiring as an O4.

If you are a JO like me, and you already have X years of service, and you are projecting your O5 retirement pay with W total points at retirement, the formula is:

$0.68167 * (1 + Z/100) ^ (20 - X) * W

Where the variable Z is your wild guess at the average annual % pay raise that military personnel will get from Congress each year between now and until you retire. A decent plug is somewhere between 1.5 and 2.5 for this variable.

For an O4 retirement, the formula is:

$0.59542 * (1 + Z/100) ^ (20 - X) * W
 

Flash

SEVAL/ECMO
None
Super Moderator
Contributor
I’ve done the math and it’s not great. Even with 1:5 mobs of 9 mo each, you don’t end up with a big pension check. You need to do 6-12 mo of ADOS a handful of times on top of those mobs to really make a dent. I am personally shooting for $5k monthly in retirement. Who knows what $5k will be worth when I’m 60, but it’s at least something.

Through the reserves alone? If so you're likely SOL. Unless you do a pretty significant amount of active duty time, as in 5 years or probably a lot more, you ain't going to have a chance. While you'll almost certainly do a MOB or two this ain't the '00's where they handed out MOB's and ADSW's like they were going out of business and I doubt times like that will happen again anytime soon.

If you got 3000 points total for your entire career, that is a pretty generous 100 points a year for 20 or more with 2 or 3 MOB's, and then retired as an O-5 you would only be getting ~17% of your base pay for retirement (3000/360 x 2.0). That's about $1700 a month right now, not too bad at all but nowhere near $5000 a month. This of course excludes TSP, while a great retirement 401k/403b/IRA type account it ain't going to do a whole lot with how little you'll be able to put into it as a reservist.
 

ABMD

Bullets don't fly without Supply
Through the reserves alone? If so you're likely SOL. Unless you do a pretty significant amount of active duty time, as in 5 years or probably a lot more, you ain't going to have a chance. While you'll almost certainly do a MOB or two this ain't the '00's where they handed out MOB's and ADSW's like they were going out of business and I doubt times like that will happen again anytime soon.

If you got 3000 points total for your entire career, that is a pretty generous 100 points a year for 20 or more with 2 or 3 MOB's, and then retired as an O-5 you would only be getting ~17% of your base pay for retirement (3000/360 x 2.0). That's about $1700 a month right now, not too bad at all but nowhere near $5000 a month. This of course excludes TSP, while a great retirement 401k/403b/IRA type account it ain't going to do a whole lot with how little you'll be able to put into it as a reservist.
This is exactly what I was thinking too, but I think he meant $5k/month from Reserve, Social Security and other retirement accounts. I may be wrong...
 

Mos

Well-Known Member
None
OP, I posted a spreadsheet here, you can see if it works for you.
 

LAMPS Ninja

I love LAMPS?
pilot
2020 monthly basic pay for O5 w/ 20 yrs

I've thought about this math a few times and am wondering how everybody else sees this. This example uses O-5 pay at 20 years, but the pay chart maxes out at 22 years for O-5. The rumor in my corner of CNAFR is that once you transfer to the retired reserve, your time in grade continues, which should max out the pay at the retired pay grade by the time you actually receive a payment (age 60, less any deductions for active time). Nobody I know actually knows anybody who's done this and has started collecting a reserve pension, so it's all conjecture at this point. Can anybody here weigh in on how it actually works (or has at least found where it's written)?
 
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