Naval Academy Graduate Pay

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Nov 15, 2016
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O.K. so I noticed a discrepancy today and was wondering if anyone could shed light on it.
When you search how much a NA grads starting pay is, it brings up the statistic of somewhere around 88,000 USD. However, when you research how much an ensign typically gets payed in the military, you see that it is around 35,664. Although I know there are other payments that add to that, I do not believe it can close that gap. So my question is, is that 88k statistic incorrect or do Naval Academy Graduates just get more pay?
 

Cerberi

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http://www.militaryfactory.com/military_pay_scale.asp

The site reflects Base Pay. Total cash to the bank also includes a non-taxable housing allowance (if not living on base) and a food allowance. The housing allowance can also include 'variable pay' depending if you live in a higher cost area and/or have dependents. You can also receive additional pay for flight pay, combat pay, and I am sure other items.

I would say with great confidence O1 pay with every type of incentive is no where near $88 K. However, if I recall correctly - the DoD used to send a letter out each year telling you what you 'really' earned and inflated the value of not paying for any medical/vision/dental expenses and such.

The pay is reflective of time in service and your rank - it is not impacted at all by being a service academy graduate (and your 4 years at the service academy do not count towards 'retirement' or years of service on the pay scale (I think at some point your years at the SA can be accounted for if applying for a civil service position)

0-1 pay does not equal $88K no matter how you cut it.
 

Capt MJ

Formerly Known As Attila The Hunnette
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Here's where you start:

https://www.dfas.mil/militarymembers/payentitlements/military-pay-charts.html

There is pay, which is taxable. Base pay is based on rank/paygrade and years of service. Most new 0-1's (ensigns and 2LTs) start out as 0-1, under 2. Prior enlisted might be at a higher rate due to years of service. There are other pays down the road: sea pay, flight pay, combat pay, various bonuses for certain communities, and so on. The sub bonus can be sizable.

Then there are allowances, not taxed. Basic Allowance for housing (BAH), is one of the bigger ones. There is a difference between with and without dependents rate.

Quite often military compensation estimates will include values for the free medical, dental, vision and prescription care provided, with no co-pays, though that is not part of salary. Ask adults you know how much they pay each month for various parts of their healthcare, and you can estimate a value there.
Commissary (grocery store) and Exchange (department store) benefits are often added in with estimated value. They are tax-free, with generally discounted merchandise. For example, I just bought Mucinex yesterday at the Commissary, $11.63, no sales tax. Price at RiteAid, same product, $18.99. Gallon of milk, $2.50, Safeway, last time I was in there a few weeks ago, about $4. Somehow a number theoretically representing potential savings from these benefits is arrived at.

For 0-1's graduating in 2017, regardless of source, AD base pay is listed in the 1 Jan 2017 pay table.

Then, pick a zip code where you might be stationed, such as San Diego. Assume you have no dependents, look up your O-1 BAH. Not taxed, remember, so you gross the whole amount.
Here's your calculator:
http://www.defensetravel.dod.mil/site/bahCalc.cfm

Using my old duty station zip of 92118 (Coronado, CA), and 0-1, no dependents, it's $2217/month.

Look up BAS, same approach. That's Basic Allowance for Subsistence.

If you go right to a ship, research sea duty pay.

This is just a quick and dirty back of the envelope description. All are paid the same, regardless of commissioning source, depending on various individual factors. There is a difference between "base pay/salary" and "total compensation."

An unofficial source:
http://militarybenefits.info/2017-bah-basic-allowance-for-housing-rates/
 
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kinnem

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O.K. so I noticed a discrepancy today and was wondering if anyone could shed light on it.
When you search how much a NA grads starting pay is, it brings up the statistic of somewhere around 88,000 USD. However, when you research how much an ensign typically gets payed in the military, you see that it is around 35,664. Although I know there are other payments that add to that, I do not believe it can close that gap. So my question is, is that 88k statistic incorrect or do Naval Academy Graduates just get more pay?

I'll leave it to others to discuss the military pay aspects. Just want to ask, are you sure the 88K figure isn't for their first civilian job after leaving the military?

Also, with regards to health insurance, take a look at the cost of the gold plans on the ACA healthcare exchanges to get a cost estimate. Ouch!
 

Capt MJ

Formerly Known As Attila The Hunnette
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I'll leave it to others to discuss the military pay aspects. Just want to ask, are you sure the 88K figure isn't for their first civilian job after leaving the military?

Also, with regards to health insurance, take a look at the cost of the gold plans on the ACA healthcare exchanges to get a cost estimate. Ouch!

Good point - "Naval Academy grad starting pay" could easily be seen in the context of post-active duty initial service obligation salary at a civilian job.
 

Brawny77

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I think that 88K figure came from a US news and World Report thing that is circulating on social media and it refers to post military pay. Naval Academy grads were second place in starting pay. Who was numero uno you ask? It was Harvey Mudd graduates. Being from rural Texas, I had to look up where that was.
 

LineInTheSand

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Not entirely fair though... USNA grad has five years of experience on his peers from civilian schools.
 

Capt MJ

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I always wondered if the nuke grads going to civilian nuke jobs bumped the average pay upward compared to other SA grads.
 

Mom529

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My mid says, according to the upperclass on his sports team, that the 88k is definitely the civilian world job, not a navy job.
 

LineInTheSand

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Pay scales are available online.

88k is maybe double what they'll make straight it.
 

5Day

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$88k is about what they should make 4-5 years out. I used the information from here https://www.usna.edu/Admissions/Career-Opportunities/Typical-Pay.php which seems to be old values, maybe last years, so they are off by a few %, but close. It includes Base Pay, Subsistence and Housing Allowance (Single) per the table.
O1...................O2.....................O3
$55,966.........$67,904.........$85,724

With Flight Pay
$57,841.........$70,243.........$88,813

With Submarine Pay
$60,601.........$73,904.........$94,934

Not a bad starting job.
 

jl123

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Feb 20, 2016
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O.K. so I noticed a discrepancy today and was wondering if anyone could shed light on it.
When you search how much a NA grads starting pay is, it brings up the statistic of somewhere around 88,000 USD. However, when you research how much an ensign typically gets payed in the military, you see that it is around 35,664. Although I know there are other payments that add to that, I do not believe it can close that gap. So my question is, is that 88k statistic incorrect or do Naval Academy Graduates just get more pay?
  1. The quoted figures (US News, SA's, etc) are for newly commissioned active duty officers right out of the academy, or ROTC etc.
  2. Although the $88k figure is presented in an optimistic scenario, it is not as as far fetched as it appears. A lot depends on duty station, tax rates and value of benefits.
To provide an example, using Capt MJ's scenario, and only considering Base Pay and BAH we can determine what a civilian must earn to have the same money to spend as an O-1. For simplicity, it does not include deductions that lower adjusted gross income, state taxes, health and other benefits, etc. :

Base Pay O-1 less than 2 years service: $3034.80 x 12 = $36,417.60
2017 Federal tax rate 15% bracket: $4,996.39
2017 Soc. Security/Medicare 7.65%: $2,785.95
BAH Coronado(non taxable): 2217 x 12 = $26,604
Cash to spend O-1: $36,417.60 - 4,996.39 - 2,785.95 + 26,604 = $55,239

A civilian with the same cash to spend must earn:
Civilian Pay : $75,691
Federal tax now at 25% bracket: $14,661.50
Soc. Sec/Medicare: $5,790.36
Cash to spend Civilian: $55,239
 
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