- Base pay is the same across the military, but can increase significantly as you move up the ranks.
- Military personnel may receive other tax-free allowances for housing and meals.
- Other benefits include comprehensive health care, discounted education, and large signing bonuses.
Most people don’t look into high-paying government jobs unless they plan to join the military.
Military service can offer a solid base salary, especially as you advance. But the overall compensation for active military personnel goes beyond the annual salary.
BI spoke with various branches of the Department of Defense, including the Navy, Marine Corps, Army, National Guard, and Air Force, as well as military personnel from those branches, to decode often complex military pay programs.
Officers can earn a salary of $220,000
All active duty military personnel adhere to the same pay scale and ranking system for base pay, regardless of the branch in which they serve.
The basic pay scale is mainly divided into two categories: enlisted personnel and officers. Enlisted members are ranked from E1 to E9 and officers are ranked from O1 to O10.
Some military personnel also receive special pay on top of their base pay if they have a military specialty or qualification, or if they are based in a high-risk location. For example, an Army E5 nuclear specialist receives $150 more per month. In the Space Force, specialized personnel are paid in increments of $75 to $450 per month, according to a spokesperson.
An enlisted member with an E-1 classification receives $2,017.20 per month in base pay, according to the 2024 DoD Base Pay Table. Usually, E1-E4 members live in the barracks and therefore only have little or no expenses.
Military members receive a routine pay increase approximately every two years based on their rank, but promotions can vary and it depends on ratings, time in the military, and the specific branch. For example, if you are in the Navy, you may have to take exams to get promoted. To become an officer, you must have a university degree.
The base salary for a new officer starts at around $3,826 per month, while a senior officer at rank 0-5 with 10 years of service will earn $9,153 per month.
An O-9 or O-10 officer can earn up to approximately $18,491 per month, which works out to approximately $221,900 per year. The earliest you can reach this amount after 20 years of service if you reach the first rank, which is difficult to achieve.
Paychecks also include tax-free allowances
Base pay is the primary compensation for military personnel, but they also receive several tax-free allowances on their paychecks.
The basic housing allowance, or BAH, is one of the most common tax-free allowances. Servicemembers begin receiving BAH when they reach E-5, get married, or have children. BAH rates are determined by the Department of Defense and are based on housing research and market analysis. They generally increase every year.
Members of the military receive amounts based on their rank, the number of dependents and the cost of living in their region. For example, an E-5 with dependents in San Diego receives $3,882 per month in BAH, according to Veteran.com.
Service members outside the United States may also receive an additional overseas housing allowance to incentivize service members to serve internationally.
Military personnel may also receive a Basic Subsistence Allowance, or BAS, intended to offset the cost of their meals. If they qualify, enlisted service members receive about $460 per month in BAS, according to the Defense Department’s Finance and Accounting Service.
There are various other allowances that depend on specific circumstances, such as clothing allowances for uniforms or family separation allowances for military personnel serving a tour of duty.
Officers can receive up to $245,000 in signing bonus
The US military distributes signing bonuses as a recruiting tool to accelerate and fill certain gaps.
A typical enlistment bonus can range between $1,000 and $2,000, according to an Army spokesperson.
But programs can pay up to $50,000 for enlistment bonuses offered to those who move into a key specialty like military cyber intelligence, according to an Army spokesperson.
Officers can receive up to $245,000 in signing bonus on a 7-year contract. The distribution of funds depends on the service designation program, a Navy spokesperson said. While some branches may give 50% upfront and spread the rest over five years, others may spread it evenly over the life of the contract.
The majority of bonuses are taxable, with the exception of bonuses given to military personnel in a non-taxable area, such as Bahrain.
Common positions that receive bonuses include pilots, nuclear sailors and warfare officers, according to a Navy spokesperson.
Free education, free health care and pension
The military offers significant education benefits with the post-9/11 GI Bill, which helps service members and their families pay part – or in some cases all – of the cost of college, graduate studies and other training programs.
If you meet the 36-month requirement, you can receive full tuition at a public school or up to $27,120.05 at a private institution. You may also be eligible for a housing allowance, according to the U.S. Department of Veterans Affairs. You can also get up to 90% of education costs covered if you have served less than 36 months.
Military personnel are also eligible for the blended retirement system after 20 years of service. The pension plan provides a traditional pension, which includes approximately 40% of pre-retirement salary, calculated by multiplying 2% of their years of service by their highest 36 months of base salary.
The system also offers a Thrift Savings Plan, which is a government-run 401(k) account, similar to a civilian retirement plan. It allows members to invest their money with a 1% contribution after 60 days of service. The government will also make matching contributions of 4% of the basic salary from the second year. TSP is accessible even if you do not complete 20 years of service.
Active-duty military members, their families, and retirees also receive free medical and dental care through Tricare, the military health care program. With Tricare, servicemembers have no additional costs for coverage or out-of-pocket costs for medical care or prescriptions.
Soldiers who serve 40 years in the army are entitled to an annual pension corresponding to their full salary.
As a member of the service, you will also be entitled to a number of other benefits, such as a discounted commissary and redemptions at grocery and department stores. The military also covers moving expenses if you are deployed to another location.
Do you work in the military and want to share your story? Email the author at aaltchek@insider.com.
businessinsider
