Abstract: Special and incentive (S&I) pays, including bonuses, are a key element of military compensation that vary because of such factors as occupation, assignment, duty type, and location. The Department of the Air Force (DAF) requested that RAND Project AIR FORCE develop a strategic compensation framework for S&I pays. The framework's purpose is to ensure that these pays achieve their intended purposes and that the DAF uses them in a coordinated, comprehensive manner while recognizing their interrelationship with other pays and aligning them with the U.S. Air Force's (USAF's) and U.S. Space Force's (USSF's) talent-management goals. The authors reviewed existing statutes, policy documents, and literature related to military compensation; convened a panel of experts to identify strategic objectives, key features, and necessary data and models for the framework; and held, discussions with subject-matter experts (SMEs) involved with setting S&I pays from the DAF, USAF, USSF, and Office of the Secretary of Defense. The authors demonstrate the framework's effectiveness by applying it to one of the DAF's widely used incentive pays: selective retention bonuses. Because the framework highlights the importance of estimating how changes to S&I pays affect desired outcomes, the authors also developed models to estimate the effects of the Assignment Incentive Pay (AIP), which is a pay designed to encourage members to volunteer for difficult-to-fill or less desirable assignments, locations, or units.