Navy Pay - The Basics
Basic Pay, Basic Allowance for Housing (BAH), and Basic Allowance for Subsistence (BAS) are the fundamental components of military pay. Members who are married or have legitimate dependents are paid at a higher rate.
An official military resource, myPay brings your pay information right to your computer in a secure, user-friendly environment. You can view online many pay items and even make changes to some without completing paper forms. With myPay, you can access your Leave and Earnings Statement (LES), elect whether to receive your LES in paper or electronic format only, make changes to your Thrift Savings Plan, plus more. myPay, formerly E/MSS, connects active duty, reservists, retirees, and DoD civilians to their pay information.
The Military Compensation website addresses military pay and benefits for current members, retirees, and survivors of retirees. Provided by the Office of the Under Secretary of Defense for Personnel and Readiness site defines the compensation available to military members.
Special and Incentive Pay
In addition to basic pay elements, a special, incentive, or critical skills pay is given to qualified personnel who possess specific or unique skills, or ones at a critical shortage. The Navy compensates individuals possessing special talents to retain them for specified periods of time. Military members are also compensated financially for circumstances such as separation from family, hazardous duty, or special duty.
Critical Skills Enlistment and Reenlistment Bonuses
The military has established checks and balances to ensure a complement of skills remain in military service. When any of the critical skills become scarce, the Department of Defense offers a financial incentive in the form of bonuses.
Overseas Housing Allowance(OHA)
The Overseas Housing Allowance, or OHA, is paid to service members who live in private housing at their overseas duty station. OHA helps offset your housing costs, which are made up of rent, utility and recurring maintenance expenses, and move-in housing allowance (MIHA). Get current housing allowances for members stationed overseas at the Defense Travel Management Office OHA website.
Enlisted personnel are issued a complete wardrobe when they begin active duty. On each enlistment anniversary, a lump sum replacement/maintenance allowance is paid. Also, those eligible to promote to Chief Petty Officer receive a special allowance to offset the initial expense of purchasing a new wardrobe of uniforms; thereafter, they receive a set annual replacement allowance.
Serving in the military has a huge advantage. When you look at your pay, add into the equation the “invisible” tax advantages sheltering BAH, BAS, and Social Security (FICA) not applied to special pay, and depending on legally declared residency, an absence of state income tax.
Additional tax relief is given when you make purchases at the military Exchange, Commissary, Package stores, and veterinarian. These tax advantages may be difficult to quantify, but anytime you receive discounts or do not pay tax because of your military affiliation, it is real cash back into your wallet. Shopping in military facilities also represents savings as the lower prices of items reflect government subsidy.
The following applies to members who retire prior to 31 Dec 2006:
After completing only 20 years of honorable service, a military retiree would receive 50% of the permanent basic pay. Each year of service thereafter adds an additional 2.5% until 30 years of service is reached, at which the retiree would receive 75% of the permanent basic pay as retirement income."
The following applies to members who retire after 31 Dec 2006 and prior to 31 Dec 2017:
In the case of a member who retires after December 31, 2006, with more than 30 years of creditable service, the percentage to be used is the sum of 75 percent and the product (stated as a percentage) of 2 1/2 and the member's years of creditable service) in excess of 30 years of creditable service. In other words, for people who retire after December 31, 2006, the 75% at 30 years cap is no longer in effect.
Beginning 1 Jan 2018, the new Blended Retirement System goes into effect.