BRS vs High-3: Which Military Retirement System Pays More?

The Blended Retirement System trades a smaller pension for government contributions to your TSP. Whether that trade pays off depends mostly on one question: will you serve 20 years? Here's how the two systems compare, with real numbers from the 2026 pay tables.

Who is in which system

Everyone who entered the military on or after January 1, 2018 is automatically covered by BRS. Members already serving at the end of 2017 stayed under the legacy High-3 system unless they chose to opt in to BRS during 2018. The choice is closed now, so for most readers this comparison is about understanding the system you have — and planning around it.

The pension formula

Both systems pay a lifetime pension to active duty members who complete 20 years, starting the month after retirement and adjusted each year for inflation. Both use the same base: your High-3 average, the average of your highest 36 months of basic pay. The difference is the multiplier:

In other words, a BRS pension is always 80% of the High-3 pension for the same career.

What BRS adds in exchange

• TSP contributions: an automatic 1% of basic pay after 60 days of service, and up to 4% more in matching after 2 years, ending at 26 years. Legacy High-3 members get no government TSP contributions.
• Continuation pay: a one-time cash bonus, typically offered between 8 and 12 years of service in exchange for additional service. Active duty amounts range from 2.5 to 13 times monthly basic pay, set by each service.
• Lump-sum option: at retirement, BRS members can take a discounted lump sum worth 25% or 50% of their pension up to full Social Security retirement age (usually 67), in exchange for a reduced monthly pension until then. The full pension resumes at that age.

Example: an E-7 retiring at 20 years

Using the 2026 pay table, an E-7 retiring at exactly 20 years has a High-3 average of $6,118.50. The monthly pensions are:

That gap grows with inflation adjustments. Retiring at 40 and collecting until 85 with a 2.5% annual cost-of-living adjustment, the High-3 member receives about $598,500 more over their lifetime.

But lifetime totals overstate what the gap is worth today. A fairer measure is the lump sum you'd need at retirement to replace the missing payments. Assuming a 6% return, that's about $167,900. So for a member who serves the full 20 years, BRS comes out ahead if the extra TSP money BRS provides — the automatic and matching contributions, plus their growth — is worth more than about that amount by retirement. Whether it is depends on how early and how consistently the member contributes 5%, and on market returns along the way.

The 20-year question

The biggest difference isn't the multiplier. It's what happens if you leave early. Under High-3, a member who separates at 8, 12 or 18 years walks away with no retirement benefit from the military at all. Under BRS, that member keeps their TSP balance, including the matching contributions and — after 2 years — the automatic 1%.

Most people who join the military don't stay 20 years. For them, BRS is clearly better. For those who do complete a full career, the answer depends on contributions, returns, and whether they take continuation pay, and the two systems can come out close.

Higher grades, bigger gaps

The dollar gap scales with pay. An O-5 retiring at 24 years has a High-3 average of about $12,274. The High-3 pension would be $7,364.46 a month, versus $5,891.57 under BRS — a difference of $1,472.89 every month. Officers who plan a full career have more ground for their TSP to make up.

What doesn't change between the two systems

A lot stays the same. Both systems require 20 years of service for an active duty pension, and both pensions receive annual cost-of-living adjustments tied to inflation. Retirees under either system keep access to TRICARE health coverage, can enroll in the Survivor Benefit Plan to continue part of the pension for a spouse, and can combine retired pay with VA disability compensation under the same concurrent receipt rules. Disability retirement and reserve component retirement also follow their own rules that apply in similar ways to both systems.

A simple way to think about it

• Likely to leave before 20 years: BRS is almost always better, because High-3 pays nothing.
• Planning a full career and contributing 5% or more from the start: the systems can come out close, and BRS often wins when returns are decent.
• Planning a full career but not contributing: BRS delivers only a smaller pension and the automatic 1%, and High-3 would have paid more.

Since the choice has already been made for most members, the practical takeaway is the same: under BRS, your own habits with the TSP decide how the system works out.

How to make BRS work for you

• Contribute at least 5% from day one. Anything less leaves matching money unclaimed.
• Don't cash out when you separate. Leaving the TSP invested preserves the benefit BRS was designed to give early leavers.
• Think carefully about continuation pay. Investing it can help close the pension gap.
• Run the lump-sum numbers before choosing it. The discount rate makes it expensive for many retirees.

Sources

• 10 U.S.C. § 1409 — Retired pay multiplier
• DoD Military Compensation — Blended Retirement System
• DFAS — 2026 military pay tables
• TSP — Contribution types (uniformed services, BRS)

MilPayLab is not affiliated with, endorsed by, or connected to the U.S. Department of Defense, DFAS, DTMO or the Department of Veterans Affairs. Figures are taken from published government rate tables and are provided for information only, not as financial, legal or tax advice. Your finance office, your LES and your VA decision letter are the final word on what you are paid.