1. What is High-3 Retirement Calculation?

The High-3 retirement calculation is used by the U.S. federal government to determine retirement benefits for federal employees. It's based on the average of the highest three consecutive years of salary.

2. How Does the Calculator Work?

The calculator uses the High-3 formula:

Where:

• \( Salary_1 \) — Highest salary year
• \( Salary_2 \) — Second highest salary year
• \( Salary_3 \) — Third highest salary year

Explanation: The three years don't need to be consecutive or immediately before retirement, but they must be the three highest-paid years of service.

3. Importance of High-3 Calculation

Details: Your High-3 average salary is crucial for calculating your federal retirement annuity. Most federal retirement systems (FERS, CSRS) use this figure as the basis for your retirement benefit.

4. Using the Calculator

Tips: Enter your three highest annual salaries in USD. The calculator will automatically compute the average. Salaries should be in whole dollar amounts without commas.

5. Frequently Asked Questions (FAQ)

Q1: What counts as salary for High-3 calculation?
A: Basic pay plus locality pay, but generally not bonuses, overtime, or allowances.

Q2: Can the three years be from different periods?
A: Yes, they don't need to be consecutive, just the three highest-paid years.

Q3: How does part-time work affect High-3?
A: Part-time salaries are annualized (calculated as if you worked full-time).

Q4: Does High-3 include COLA increases?
A: No, it's based on your actual salary, not adjusted for inflation.

Q5: When should I calculate my High-3?
A: Ideally several years before retirement to help with planning, and again when preparing retirement paperwork.