Medical Retirement vs. Regular Retirement

[PolloxTroy08]

@RonG or anyone that can help.

I'm currently an Army SSG and have nearly 19 years AFS; eligible for retirement on 1 JUL 24. My doctors tell me they can start the med board process for me to get a medical retirement, however, I've always heard it's best to wait until 19 years to start the process so you're guaranteed to get 20 years and qualify for a regular retirement. My High 3 is currently $4500, however, I used to be a Major and my High 3 would be around $9000. I know I'll get 100% from the VA for all my conditions which is currently $4071. I guesstimate my DOD percentage will be around 70%. Is it true I need to make sure I get 20 years to maximize the amount of money I could receive? From reading other posts, would my compensation breakdown be this?

1. High three is around 9000; then, 9000 x 70% DoD percentage = 6300 disability retired pay
2. 6300 minus 4071 VA amount per my remarks = 2229 residual retired pay I get to keep
3. I should have 20 years for a regular retirement, plus nearly 10 months in Reserve IDT time (2% extra)
4. 20 years active duty x 2.5% + 2% = 52% for longevity retirement.
5. 9000 x 52% = 4680 longevity portion of retired pay
6. CRDP will be: 4680 minus 2229 residual retired pay = 2451 CRDP
7. Using my info, DFAS will pay:
--2451 CRDP
--2229 residual retired pay
TOTAL from DFAS: 4680
8. The VA will pay 4071 for 2023 with 1 spouse and 2 kids

So would my total retirement compensation be: 2451 + 2229 + 4071 = 8751 (with CDRP taxable)?

Also - Can anyone verify that I'll retire at my highest High 3 regardless of rank if I'm medically retired? If I just get a regular retirement my High 3 is at my enlisted E6 rank and not my O4 rank until 30 years of total active service/retirement time.

Thank you for any assistance that can be provided.



Thank you very much for any insight you can provide.

 

[Provis]

@RonG or anyone that can help.

I'm currently an Army SSG and have nearly 19 years AFS; eligible for retirement on 1 JUL 24. My doctors tell me they can start the med board process for me to get a medical retirement, however, I've always heard it's best to wait until 19 years to start the process so you're guaranteed to get 20 years and qualify for a regular retirement. My High 3 is currently $4500, however, I used to be a Major and my High 3 would be around $9000. I know I'll get 100% from the VA for all my conditions which is currently $4071. I guesstimate my DOD percentage will be around 70%. Is it true I need to make sure I get 20 years to maximize the amount of money I could receive? From reading other posts, would my compensation breakdown be this?

1. High three is around 9000; then, 9000 x 70% DoD percentage = 6300 disability retired pay
2. 6300 minus 4071 VA amount per my remarks = 2229 residual retired pay I get to keep
3. I should have 20 years for a regular retirement, plus nearly 10 months in Reserve IDT time (2% extra)
4. 20 years active duty x 2.5% + 2% = 52% for longevity retirement.
5. 9000 x 52% = 4680 longevity portion of retired pay
6. CRDP will be: 4680 minus 2229 residual retired pay = 2451 CRDP
7. Using my info, DFAS will pay:
--2451 CRDP
--2229 residual retired pay
TOTAL from DFAS: 4680
8. The VA will pay 4071 for 2023 with 1 spouse and 2 kids

So would my total retirement compensation be: 2451 + 2229 + 4071 = 8751 (with CDRP taxable)?

Also - Can anyone verify that I'll retire at my highest High 3 regardless of rank if I'm medically retired? If I just get a regular retirement my High 3 is at my enlisted E6 rank and not my O4 rank until 30 years of total active service/retirement time.

Thank you for any assistance that can be provided.



Thank you very much for any insight you can provide.

Hitting 20 years ensures maximum compensation. In theory you could net more from a chapter 61 retirement if you are eligible for both and your DOD% is higher than your earned longevity AND one of the unfitting conditions is designated combat related. The net is higher due to not having to pay federal taxes. You could accomplish the same highest net compensation by qualifying for CRSC if that amount qualified for would give you all of your VA offset back to you.

The best route is to hit 20 year regular retirement because if you don't hit that and get out chapter 61 then you don't get CRDP and CRSC isn't guaranteed. If you hit 20 year regular retirement you will receive all of your earned pension which will be taxable and all of your VA compensation which won't be taxable. Getting a higher DOD% chapter 61 retirement won't get you more compensation for gross pay because by law you can't get more than your earned longevity towards your regular retirement + your VA compensation.

You should be high 3 regardless of if medically retired or regular retired.

 

[RonG]

High three average base pay = the total of the highest 36 months of base pay divided by 36.

I am not sure about " plus nearly 10 months in Reserve IDT time (2% extra)" but I believe it can be added after otherwise qualified for retirement, but cannot be used to attain the required time in service for retirement.

Points divided by 360 = active duty equivalent

I agree with the remarks by @Provis

Ron

 

[PolloxTroy08]

Thank you both for your quick responses. Unfortunately there is a little known provision in the law that will make my High 3 of only my enlisted time since I’m retiring on enlisted status. My officer pay was for naught, but I can apply to get advanced to O4 and have my retirement pay recalculated after 30 total years active/retirement service.

 

[RonG]

Thank you both for your quick responses. Unfortunately there is a little known provision in the law that will make my High 3 of only my enlisted time since I’m retiring on enlisted status. My officer pay was for naught, but I can apply to get advanced to O4 and have my retirement pay recalculated after 30 total years active/retirement service.

Thank you...I did not know of that provision of law. I believe you, but want to review it for use later. We appreciate your comments.

Ron

 

[PolloxTroy08]

Thank you...I did not know of that provision of law. I believe you, but want to review it for use later. We appreciate your comments.

Ron

Yeah, it sucks. It’s not what I was told by my Retirement Services Officer prior to resigning my commission.

The Navy law is

10 U.S. Code § 8326​

 

[PolloxTroy08]

To clarify, I'm told 10 USC 1407(e) applies to me in not receiving my officer High 3.

 

[RonG]

To clarify, I'm told 10 USC 1407(e) applies to me in not receiving my officer High 3.

Thank you for providing the reference. I did have a chance to review it. Your info will help others in the future.

It would seem that the retirement services people would have known of that provision of law.

I came under the old Final Pay provision of law (EAD 1966; Retired AD 1991).

Ron