This instructional video serves as a comprehensive guide on how to calculate the high-three average for federal retirement, a critical aspect of pension planning. The video meticulously breaks down the inclusion and exclusion criteria for various pay types in the high-three calculation, offering a detailed example to enhance viewers’ comprehension. Emphasis is placed on understanding creditable service, encompassing both civilian and military service, and considerations for loyalty pay. The video underscores the pivotal role of the high-three calculation in determining federal retirement benefits and extends assistance through a questionnaire designed to help individuals assess their retirement plans.
The video features a dialogue between an individual seeking guidance on high-three calculations and a consultant. The consultant stresses the importance of keeping track of such calculations throughout one’s career for a well-informed retirement plan. The individual’s creditable service is meticulously calculated, combining civilian and military service along with unused sick leave.
Crucial exclusions in the high-three calculation are highlighted, such as bonuses, overtime pay, military pay, and other non-basic pay components. The video explains that the high-three average salary for wage grade employees includes specific differentials and is determined based on a 2087-hour work year.
Before diving into the calculations, the consultant explains that high-three salary is the average of adjusted basic pay over any three consecutive years of creditable service, incorporating loyalty pay. The calculations are then broken down for a specific period, using the high-three time factor table to determine the time factor for each segment. The video walks through the steps, culminating in the determination of the high-three average pay.
The individual expresses gratitude for the consultant’s assistance, acknowledging the complexity of the calculations and the invaluable help received. The video concludes with an invitation to explore more information or take a questionnaire linked in the video description for a better understanding of retirement plans.
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