Q. How does one calculate top three? Is that the amount you make annually for the last three years of your top salary? For example: .01 x $62,000 x 20 (with $62,000 being the average of one’s top 3).
A. Your High-3 is calculated by adding up the basic pay you received each pay period for three consecutive years (26 pay periods per year x 3 = 78 pay periods). That number is divided by 3 to determine your High-3. As a rule, those pay periods are the ones that immediately preceded your retirement.
However, if your basic pay was higher at an earlier point in your career, those pay periods will be used instead.