Using a different approach from the studies of military compensation summarized in Table 1, the Congressional Budget Office (CBO) also estimated compensation for the typical enlisted service member in 2006, including only benefits that the person was likely to use.⁽¹⁾

The median enlisted member has served in the military for four years. Among people at that level of experience, the median pay grade is E-4, and the median age is 22. About 52 percent of those E-4s have no dependents, and 48 percent of them do. Because the probability of having dependents is so close to 50/50, CBO estimated compensation for an average member with or without a family.

In 2006, a 22-year-old E-4 with no dependents received a total compensation package worth about $70,450. Of that amount, 54 percent was in cash—basic pay, allowances for food and housing, and the tax advantage that military personnel receive because those allowances are not subject to federal income taxes (see Table A-1). The rest of that member's compensation took the form of noncash or deferred benefits. About 8 percent of his or her total compensation consisted of subsidized goods and services that could be used immediately, such as medical care or groceries purchased at commissaries. The other 38 percent of total compensation was the accrued cost of retirement annuities and other deferred benefits that the member may receive after he or she leaves active duty, including health care for retirees and veterans' benefits. (About 40 percent of that deferred noncash compensation goes to veterans who leave the military without serving for 20 years, and about 60 percent goes to veterans who reach that length of service or otherwise become eligible for retirement benefits.)

Table A-1.

Personnel with families earn greater compensation than single members. A married E-4 with two children earned about $85,800 in 2006, of which nearly half was cash compensation and half noncash and deferred compensation. Current noncash benefits made up a much larger share of total compensation for that member than for his or her single counterpart: 21 percent versus 8 percent. Those benefits mainly included health care for the member and his or her family, subsidized child care (assuming that the member's spouse is employed), and subsidized groceries at the commissary. The other 30 percent was deferred compensation.