Military Time Buy Back Calculator

Estimate the cost of buying back your military service time for federal retirement.

Calculate Your Military Time Buy Back

What is a Military Time Buy Back?

The military time buy back program allows eligible federal employees with prior military service to make a deposit to the federal retirement system to get credit for their military time. This means your years of military service can be added to your years of civilian service, which can significantly increase your retirement annuity and may allow you to retire earlier. The program is available to those under the Federal Employees Retirement System (FERS) and the Civil Service Retirement System (CSRS). By “buying back” your time, you are essentially making a deposit to cover the retirement contributions you would have made if you were a civilian employee during your military service.

Military Time Buy Back Formula and Explanation

The cost of buying back your military time is based on a percentage of your total military base pay. The formula is as follows:

Deposit Cost = (Total Military Base Pay) x (Retirement System Percentage)

For FERS employees, the rate is generally 3%, while for CSRS employees, it is 7%. It is important to note that this is based on your *basic* pay and does not include allowances or other special pay. Interest can also accrue if you do not buy back your time within a specific grace period (typically two to three years) after becoming a federal employee, which can significantly increase the total cost.

Variables in the Military Time Buy Back Calculation

Variable	Meaning	Unit	Typical Range
Total Military Base Pay	The sum of all basic pay earned during active duty.	USD ($)	$50,000 – $200,000+
Retirement System	Your federal retirement plan (FERS or CSRS).	Categorical	FERS or CSRS
Years of Military Service	The number of years you served on active duty.	Years	2 – 20+
High-3 Average Salary	The average of your highest 3 years of salary.	USD ($)	$70,000 – $150,000+

Practical Examples

Example 1: FERS Employee

An employee under FERS has 4 years of military service with a total base pay of $100,000. Their high-3 average salary is estimated to be $90,000.

• Inputs:
  • Total Military Base Pay: $100,000
  • Retirement System: FERS
  • Years of Military Service: 4
  • High-3 Average Salary: $90,000
• Results:
  • Deposit Cost: $100,000 * 3% = $3,000
  • Potential Annual Pension Increase: 4 years * 1% * $90,000 = $3,600

Example 2: CSRS Employee with Delayed Buy Back

An employee under CSRS has 8 years of military service and a total base pay of $150,000. They waited five years to initiate the buy back, so interest has accrued. Their high-3 average salary is $110,000.

• Inputs:
  • Total Military Base Pay: $150,000
  • Retirement System: CSRS
  • Years of Military Service: 8
  • High-3 Average Salary: $110,000
• Results:
  • Deposit Cost: $150,000 * 7% = $10,500
  • Interest (example): ~$1,500 (this will vary)
  • Total Cost: ~$12,000
  • Potential Annual Pension Increase: 8 years * 1.5% * $110,000 = $13,200 (first 5 years) and 3 years * 1.75% * $110,000 = $5,775. Total = $18,975

How to Use This Military Time Buy Back Calculator

Our calculator is designed to be simple and intuitive. Follow these steps to get your estimate:

1. Enter Total Military Base Pay: Input the total amount of basic pay you received during your military service.
2. Select Your Retirement System: Choose between FERS and CSRS.
3. Enter Years of Military Service: Input the number of years you served.
4. Enter High-3 Average Salary: Provide an estimate of your high-3 salary for a more complete picture.
5. Click “Calculate”: The calculator will display your estimated deposit cost, any accrued interest, and the potential increase in your annual pension.

Key Factors That Affect Military Time Buy Back

• Retirement System (FERS vs. CSRS): The percentage used for the calculation is different for each system.
• Timing of Buy Back: Waiting to buy back your time can result in significant interest charges.
• Military Base Pay: The higher your base pay was, the higher the deposit cost.
• Years of Service: More years of service will result in a higher deposit, but also a greater potential increase in your annuity.
• Waiving Military Retired Pay: If you are receiving military retirement pay, you generally must waive it to receive credit for your service under FERS or CSRS.
• Honorable Service: Your military service must have been active duty and terminated under honorable conditions.

Frequently Asked Questions (FAQ)

Is it worth it to buy back military time?

For many, yes. It can increase your monthly pension and allow you to retire earlier. Use our calculator to see the potential financial benefits for your specific situation.

How is the cost of military time buy back calculated?

The cost is a percentage of your total military base pay (3% for FERS, 7% for CSRS). There are also some slight variations for service in 1999 and 2000.

What happens if I wait to buy back my military time?

If you don’t buy back your time within the interest-free grace period (usually 2-3 years after you become a federal employee), interest will be charged annually, increasing the total cost.

How long do I have to buy back my military time?

You can buy it back any time before you retire, but it is financially advantageous to do so within the grace period to avoid interest.

Does buying back military time affect my VA disability benefits?

No, buying back your military time for federal retirement purposes does not affect your VA disability benefits.

Can I buy back my time if I am medically retired from the military?

Generally, you cannot receive credit for military service if you are receiving military retired pay, including disability retirement, unless you waive the retired pay.

What forms are needed to start the military time buy back process?

You will typically need to complete Form RI 20-97 (Estimated Earnings During Military Service) and Form SF 3108 (Application to Make Service Credit Payment).

Where can I find my military base pay information?

You can request your estimated military earnings from the Defense Finance and Accounting Service (DFAS).