4 Things to Consider When Retiring From the Military

Retiring from the military is a big step. You'll have many decisions to make for both you and your family as you plan for civilian life. Before you retire, you'll need to take a look at your retirement pay and benefits in order to plan your post-retirement budget. You can also expect some lifestyle changes as you trade in your military uniform for civilian clothes.

Separation requirements

As you begin the retirement process, give yourself plenty of time to complete all of the tasks that are required before you separate, including:

  • Pre-separation counseling - Required by law, pre-separation counseling must be completed no fewer than 90 days before separation. However, retiring military members are authorized to take the counseling as much as 24 months before their retirement date. You'll learn about medical insurance, relocation assistance, life insurance, Department of Veterans Affairs benefits and many other benefits and entitlements.
  • Transition Assistance Program employment workshop -Depending on your branch of service, the Transition Assistance Program employment workshop may be mandatory. The workshop will include information on job-search strategies, resume; writing, interviewing skills, job offers and salary negotiation.
  • Final medical and dental exams - Schedule your mandatory final medical and dental exams with your installation's medical clinic 90 days before your separation.
  • Visit the transportation management office - As soon as you know where you're going, schedule the move or storage of your household goods. Although retirees have one year after leaving active duty to complete their final move, scheduling the move early will help ensure you move on the date you choose.

Planning your retirement budget

Calculating your retirement pay is the first step in planning your budget. Retirement calculators, like the Military Pay Retirement Calculator, can help you estimate what your retirement check will look like. Keep in mind that these calculators do not include deductions such as taxes. A financial counselor in the military and family support center or through Military OneSource can also help you plan your retirement budget.

  • Retirement pay - Your retirement pay is based on several factors including when you first entered active service. However, entitlements such as incentive pay are not considered when calculating retirement pay. There are three basic types of non-disability retirement pay:
    • Final Basic Pay is for service members with a date of initial entry to military service prior to September 8, 1980.
    • High-three is for service members with a date of initial entry to military service between September 8, 1980 and July 31, 1986, and those with dates after August 1, 1986 who did not elect REDUX.
    • REDUX is for service members with a date of initial entry to military service after July 31, 1986 who accepted a mid-career bonus at the 15-year mark and agreed to remain on active duty for at least 20 years.
  • Deductions - Federal taxes and state taxes (where applicable) will be withheld from your retirement check. You should also take medical premiums, dental premiums and Survivor Benefit Plan premiums into consideration when planning your budget.
  • Cost-of-living adjustments - Like your active duty pay, your retirement pay is adjusted annually based on the cost of living, helping protect your income against inflation.

Your benefits

  • Medical care - Retirees and their family members are eligible for the Military Health System, which includes TRICARE. Retirees must sign up for TRICARE Prime when they retire or they are automatically enrolled in TRICARE Standard. TRICARE also has an overseas program and a program for retirees who are covered by Medicare Part A and B. Details are available on the TRICARE website.
  • Dental care - Dental insurance is available to retirees through Delta Dental and TRICARE for a monthly premium. Retirees may enroll at any time after retirement at Delta Dental.
  • Relocation - Retirees are authorized a final move anywhere within the United States (including Alaska and Hawaii) or to their home of record outside the United States. The benefits are available for one year from your retirement date, but extensions may be granted. For more information, visit the Relocation Assistance Program on your installation.
  • Survivor Benefit Plan - This program allows retired service members including National Guardsmen and Reservists to provide, upon their death, a portion of their retired pay to a spouse or other eligible person. Like retirement pay, the SBP benefits are inflation protected. Every retiring service member with an eligible spouse or child is automatically enrolled in the SBP at the maximum level unless another election is made. If you don't want the maximum level, you must make the election before you become eligible for retirement pay. More information on SBP is available on the Military Pay SBP website or your installation's Transition Assistance Program office.
  • Life Insurance - Your Servicemembers' Group Life Insurance will continue for 120 days after you separate from active duty. You can convert your life insurance from SGLI to Veterans' Group Life Insurance within the 120 days (after 120 days you must provide proof of good health). Visit the Department of Veterans Affairs' Life Insurance website for more information.
  • Commissary and exchange privileges - Retirees and their eligible family members have unlimited commissary and exchange privileges after retirement. However, in overseas locations the privileges may be subject to Status of Forces Agreements.
  • The GI Bill® - Depending on the program, GI Bill® benefits can be used for 10 or 15 years after discharge. There are several programs available and your eligibility and available benefits will depend on your dates of service. For details on specific GI Bill® programs, visit the education office on your installation or the GI Bill® website.
  • Department of Veterans Affairs home loans are available to retirees, even after leaving the military - To be eligible, you must have served at least 24 months and have an honorable or general discharge. For more information visit the Department of Veterans Affairs Home Loan Program or call 800-827-1000.

Challenges you can expect

For many military service members, leaving the military has unexpected emotional side effects. Here are some challenges you can expect and strategies that can help:

  • Saying goodbye to your military life - When you leave the military, there will be a time of grieving for you and your family as you say goodbye to old friends. Keeping in touch with your military friends and getting involved with your new, civilian life - will help you adjust quickly.
  • Finding a new job - Looking for a new job can put a tremendous strain on you and your family. But with early planning, you may land a job before you retire. Attending a Transition Assistance Program employment workshop (available through the installation program office on your installation) as much as two years before you retire will help you get started.
  • Lack of camaraderie at work - After leaving the military, many service members miss the camaraderie they had with their fellow service members. Often the work environment in civilian companies is much different from the military. Joining military organizations will help you connect with other military retirees and help you keep up to date on retirement issues that may affect you and your family.


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