2027 Military Pay Chart by Rank, With the 7-6-5 Raise Now Ordered for January

Where the 2027 Pay Raise Stands

On August 26, 2026 the President sent Congress an alternative pay plan under 37 U.S.C. 1009(e). It sets the 2027 monthly basic pay increase at 7% for grades E-1 to E-5, 6% for E-6 to O-3 and 5% for O-4 and above, "subject to the caps established by 37 U.S.C. 203," and says the adjustments "shall take effect on January 1, 2027." It covers the Armed Forces and the Coast Guard. The NOAA Corps and Public Health Service get 3.6%.

The tiers themselves aren't new. They first appeared in the fiscal year 2027 budget request on April 3, 2026, which asked for "$5.8 billion for a 7-6-5 percent targeted military pay raise." What changed in August is that the plan is now formally on file under the pay statute rather than sitting in a budget document.

The raise structure:

• 7% for E-1 through E-5 (over 600,000 active-duty service members)
• 6% for E-6 through O-3 (mid-grade enlisted and junior officers)
• 5% for O-4 and above (field-grade and general officers)

If this sounds unusual, it is. Military pay raises have been a flat percentage across all ranks for nearly every year since 2007. The exception came in 2025, when Congress added a 10% targeted raise for E-1 through E-4 on top of the 4.5% general raise, giving junior enlisted a total 14.5% bump. The 2027 raise extends that approach across three tiers.

The case for it is the one made in 2025, recruiting and keeping junior enlisted members. Targeted raises for particular grades were also used in the early and mid 2000s.

What Happened to the 3.6%

Under 37 U.S.C. 1009(c), the annual military pay raise is tied to the Employment Cost Index (ECI), which tracks private-sector wage growth. For 2027 that formula produces 3.6% for every rank. Until August, 3.6% was what would happen if Congress did nothing.

The August plan changed that. Section 1009(e) lets the President replace the formula raise by sending Congress an alternative plan before September 1, which is what the August 26 letter does. The same authority set the raise at 1% in 2014 and 2015, when the formula called for 1.8% both years, and Congress didn't override it, so 1% is what troops got. Those plans went below the formula. This one goes above it.

So 7-6-5 is now what DFAS is set to pay on January 1, unless Congress enacts a different number first. The Senate Armed Services Committee's bill would do exactly that at 3.6%. That's the real fight now, and it's covered in what happens in Congress below.

The Three Tiers: 7%, 6%, and 5%

Here's what each tier means in dollar terms for active-duty pay. These are monthly base pay increases for members currently at these ranks:

Base pay figures at 20 years of service except where another length is shown in the table. Derived from 2026 military pay tables. These use the 7-6-5 raise ordered August 26 and will change if Congress enacts different percentages.

2027 Projected Pay Chart by Rank

There is no official 2027 pay chart yet. DFAS publishes it in December. What follows is the closest honest thing, the published 2026 basic pay tables with the 7-6-5 raise ordered on August 26 applied to every cell. That is what takes effect January 1 unless Congress enacts a different number.

If the final NDAA sets the Senate's 3.6% instead, every figure here would come down, by about 3.2% for E-1 to E-5, 2.3% for E-6 to O-3 and 1.3% for O-4 and above. The tier section above shows both side by side. Warrant officers are shown at 6%. The plan's 6% band runs from E-6 to O-3, and warrant grades sit inside that range in DoD's pay grade order, but DFAS's December table is the final word.

2027 Projected Enlisted Pay (E-1 to E-9)

Years of service 20 and below, monthly basic pay:

2027 Projected Warrant Officer Pay (W-1 to W-5)

Years of service 20 and below, monthly basic pay:

2027 Projected Officer Pay (O-1 to O-8)

Years of service 20 and below, monthly basic pay:

How these are worked out. 2026 basic pay multiplied by 1.07, 1.06 or 1.05 by grade, rounded to the nearest 10 cents, which is how the published tables are expressed. Running that same method on the 2025 to 2026 raise reproduces 500 of 503 published cells to within 10 cents and every one of them to within 20 cents, so treat an individual figure as good to about a dime rather than exact. *The O-8 over-20 cell is held at $18,999.90, the 2026 Executive Schedule Level II limit that 37 U.S.C. 203 applies to basic pay. The President's plan freezes 2026 civilian rates, so that limit is expected to hold for 2027, but the 2027 figure isn't published yet. O-9 and O-10 are left out because their basic pay sits at that cap rather than moving with the raise.

How This Compares to Recent Years

Here's how the 2027 raise stacks up against recent years:

The 7% tier for E-5 and below builds on the 14.5% that E-1 through E-4 received in 2025. If 7-6-5 holds, a junior enlisted member would see back-to-back above-average raises totaling roughly 22% over two years.

How the 2027 Pay Raise Changes Your Retirement Pay

Every site covering this story shows you the active-duty pay increase. Here's what they're not showing: this raise permanently changes your retirement pension.

The High-3 Connection

Under the High-3 retirement system, your pension is calculated as:

When base pay goes up, your High-3 average goes up. At 20 years of service, that means 50% of a higher number. At 30 years, it means 75% of a higher number. The raise compounds permanently into every retirement check you collect for the rest of your life.

Projected Retirement Pay Impact (High-3, 20 Years)

This table shows the eventual retirement pay increase once the full raise is reflected in your High-3 window. For someone retiring in late 2029 or later, all 36 months of their High-3 would include the raised pay.

2026 retirement pay from our 2026 military retirement pay chart. Increase assumes the full tiered raise reflected in the High-3 window.

7-6-5 vs. the Senate's 3.6%: What's at Stake

If the final NDAA sets the Senate's 3.6% for everyone instead, here's the retirement pay difference:

Relative to pension size, the tiered structure helps junior enlisted the most. The E-5 gets 3.4 extra points of raise over 3.6%, the O-5 gets 1.4. In absolute dollars the results land close together. An E-5 gets an extra $852/year in retirement pay from 7-6-5 compared with a flat 3.6%, and an O-5 gets an extra $912/year because the smaller percentage rides on a much larger pension. Either way, the difference adds up over a 30 to 40 year retirement.

BRS Members: Pension and TSP Impact

If you joined on or after January 1, 2018 (or opted into BRS), the pay raise affects you in two ways.

Smaller Pension Increase (2.0% Multiplier)

BRS uses a 2.0% multiplier instead of 2.5%. At 20 years, that's 40% of your High-3 average instead of 50%. The same pay raise produces a smaller pension bump:

Bigger TSP Match (The Part People Forget)

The government matches up to 5% of your base pay into the TSP. When your base pay goes up, the match goes up too.

For an E-7 at 20 years contributing 5% of base pay:

• 2026 government match: $6,246 x 5% = $312/month ($3,748/year)
• 2027 government match (6% raise): $6,621 x 5% = $331/month ($3,973/year)
• Extra TSP contribution from raise: $225/year

That $225 extra per year in TSP contributions, growing at historical market returns over 10-20 years, adds $3,000 to $6,000 to your TSP balance at retirement. It's not dramatic on its own, but it compounds alongside your higher pension and your own increased contributions.

For a deeper breakdown of BRS pension math, see how to calculate military retirement pay or our BRS lump sum vs. annuity guide.

Retire Before or After the Raise?

If you're planning to retire in late 2026 or early 2027, the timing of the raise matters for your pension.

How the High-3 Window Works

Your High-3 average is the mean of your highest 36 consecutive months of base pay. Since pay generally goes up every year, this is almost always your final 36 months of service.

• Retire December 31, 2026: Your High-3 includes 2024, 2025, and 2026 pay. Zero months at the 2027 rate. You miss the raise entirely.
• Retire December 31, 2027: Your High-3 includes 2025, 2026, and 2027 pay. 12 of 36 months are at the higher rate. You get roughly 1/3 of the full raise impact.
• Retire December 31, 2028: Your High-3 includes 2026, 2027, and 2028 pay. 24 of 36 months reflect post-raise pay (assuming a raise in 2028 too). About 2/3 of the impact.
• Retire in 2029 or later: Full High-3 window reflects the 2027 raise and beyond. Full impact.

For more on retirement timing strategy, see the COLA trap, which explains how your retirement month affects your first COLA adjustment.

Pay Raise vs. COLA: Two Different Raises, Two Different Checks

This is the most common confusion in military retirement planning. The active-duty pay raise and the retiree COLA are not the same thing.

If you're already retired, the pay raise does not change your pension. Your check is adjusted only by the COLA. For the latest COLA tracking data, see our 2027 COLA forecast for military retirees, and for why the COLA rarely matches the inflation headline, how the COLA is calculated.

If you're still on active duty and planning to retire, both matter. The pay raise increases your future retirement pay. The COLA adjusts that retirement pay for inflation after you retire.

State Tax Impact on the Higher Retirement Pay

A bigger retirement check means more taxable income, unless you live in a state that exempts military retirement pay. What you actually keep from the raise depends on where you retire.

Tax-Free States (You Keep the Full Increase)

38 states fully exempt military retirement pay from state income tax. That includes 9 states with no income tax at all (Texas, Florida, Tennessee, Wyoming, Nevada, South Dakota, Alaska, New Hampshire, Washington) and 29 states that specifically exempt military pensions.

In these states, every dollar of the pay raise increase flows directly to your pocket.

States That Tax Military Retirement

In the remaining 12 states, you'll pay state income tax on the higher retirement pay. Here's what the E-7 retirement increase (+$173/month, +$2,074/year) looks like after state taxes:

The difference isn't massive on the raise alone, but it compounds with your full retirement pay. Over a 30-year retirement, a California retiree pays roughly $3,700 more in state tax on the raise alone compared to a Texas retiree. See our state-by-state military retirement tax guide for all 50 states.

What Happens in Congress

The President's plan sets the default, but a pay raise written into the NDAA overrides it. Here's where the bill stands.

The House passed its NDAA in July with 7-6-5, matching the House Armed Services Committee and the House Appropriations defense subcommittee. The Senate Armed Services Committee reported a bill with 3.6%, the statutory formula amount, and the full Senate hasn't passed its version. A conference can't formally start until it does. So the two numbers still in play are 7-6-5, which is what the President ordered and what takes effect if the final bill is silent, and 3.6%, which is what happens if the Senate's figure wins in conference. In 2025, Congress pushed junior enlisted raises to 14.5% when the White House had asked for 4.5%, so Congress going its own way isn't unusual.

The Trade-Offs in This Budget

The same August 26 letter that ordered 7-6-5 for the military froze 2026 base and locality pay for civilian federal employees, with a separate 3.8% raise for federal law enforcement. That gap has drawn criticism from federal employee groups and some members of Congress. The budget also cuts PCS (permanent change of station) spending, with Army PCS travel dropping from $2.3 billion to $1.99 billion and DoD targeting a 50% PCS cut by 2030.

Todd Harrison at the American Enterprise Institute argued the above-ECI raise isn't justified by current data, calling labor costs "sticky" and warning that the compounding effect will be "enormous" over time. Whether you agree or not, the debate is real and could shape the final numbers Congress passes.

What If Congress Changes the Numbers?

Three outcomes are realistic.

1. The final NDAA matches 7-6-5, or says nothing about the raise. The August 26 plan stands. Junior enlisted get the largest raise and the tables above are the right ones.
2. The final NDAA sets the Senate's 3.6%. A number written into law replaces the President's plan. Every rank gets 3.6%, and each figure in the pay chart above comes down by 1.3% to 3.2% depending on tier.
3. Congress writes a compromise. Anything in between, flat or tiered, would replace both numbers.

We'll update this article when the Senate passes its bill and again when the final NDAA is signed.

Bottom Line: What to Do Right Now

Whether the final number is 7-6-5 or 3.6%, a pay raise is coming on January 1, 2027. Here's what matters for your retirement planning.

1. The raise increases your pension permanently. Every dollar added to your base pay flows into your High-3 average, which means a bigger retirement check for life.
2. BRS members benefit through both pension and TSP. The pension increase is smaller (2.0% vs. 2.5% multiplier), but the higher government TSP match partially offsets the difference.
3. State taxes eat into the increase. If you have flexibility on where to retire, the difference between a tax-free state and California can be $100+ per month on your full retirement pay. See our best states for military retirees ranking.
4. Don't confuse the pay raise with the COLA. If you're already retired, the pay raise doesn't apply to you. Your check is adjusted by the 2027 COLA, tracking 3.4% to 3.5% with the official number due October 14.
5. Run your numbers. Use our military retirement calculator to see exactly what your projected retirement pay, VA disability, and civilian salary target look like under different raise scenarios.

Frequently Asked Questions

How much is the 2027 military pay raise?

On August 26, 2026 the President set it at 7% for E-1 through E-5, 6% for E-6 through O-3 and 5% for O-4 and above, effective January 1, 2027. The Employment Cost Index formula would have given 3.6% to everyone. The House NDAA matches 7-6-5 and the Senate committee bill says 3.6%, so the figure can still change if Congress enacts a different one.

When does the 2027 military pay raise take effect?

January 1, 2027. The raise under 37 U.S.C. 1009 takes effect on that date whether or not the NDAA has been signed, and the first paycheck at the new rate is the January 15 payday.

Does the pay raise affect my retirement pay?

Yes. The raise increases base pay, which raises the High-3 average used to calculate your pension. The full impact takes about 3 years to fully reflect in your High-3 window. An E-7 retiring at 20 years would eventually see about +$173/month more in retirement pay from the 6% raise.

Is the pay raise the same as the COLA?

No. The pay raise applies to active-duty base pay and affects future retirees. The COLA adjusts current retirees' existing pension checks. Different calculations, different recipients. See our 2027 COLA forecast for the retiree number.

Has a tiered military pay raise been done before?

Yes. In 2025, Congress gave E-1 through E-4 a 14.5% raise (4.5% general plus 10% targeted) while all other ranks got 4.5%. Targeted raises for particular grades were also used in the early and mid 2000s. The 2027 raise extends the tiered approach to three rank tiers across the whole force rather than just targeting junior enlisted.

What happens if Congress passes 3.6% instead of 7-6-5?

A raise written into law by Congress replaces the President's alternative plan, so if the final NDAA sets 3.6%, every rank gets 3.6%. If the final NDAA sets no figure, the President's 7-6-5 plan is what takes effect, the same way the President's 1% plans took effect in 2014 and 2015 when the formula called for 1.8%.

How does the raise affect BRS retirement?

BRS uses a 2.0% multiplier instead of 2.5%, so the pension increase is 80% of what High-3 members get. An E-7 under BRS would see about +$138/month vs. +$173/month under High-3. However, the raise also increases the government TSP match (up to 5% of base pay), adding $225/year more to your TSP.

Does the pay raise affect BAH or BAS?

No. BAH is calculated from local housing cost surveys, and BAS is tied to the USDA food cost index. Neither is connected to the base pay raise percentage.

Sources

• Alternative Plan for Pay Adjustments, letter from the President dated August 26, 2026, House Document 119-189
• 37 U.S.C. 1009(c) (ECI pay raise formula) and 1009(e) (alternative pay adjustment), and 37 U.S.C. 203 (basic pay cap)
• Congressional Research Service, "FY2027 NDAA: Military Basic Pay Raise Proposal," IN12706, July 14, 2026
• White House FY2027 Budget Request, April 3, 2026
• Defense Finance and Accounting Service (DFAS), 2026 Military Pay Tables
• 2026 Military Retirement Pay Chart, militaryretirementcalc.com
• How to Calculate Military Retirement Pay 2026, militaryretirementcalc.com

This article will be updated as the FY2027 NDAA progresses through Congress. Last updated September 30, 2026.