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Bottom Line Up Front

  • Start prepping for retirement at least 2 years in advance.
  • Before separation, must-do items include attending TAP workshops and scheduling counseling sessions, medical exams and your final move.
  • The Department of Defense has service-specific tools and resources online for servicemembers and their families.

Time to Read

6 minutes

July 15, 2022

If you’re considering retiring from the military, you may have started thinking about what comes next. The good news is you don’t have to figure it all out on your own. There are resources in place to help you set yourself up for continued success. Here are some things you may want to consider as you plan your retirement.

Separation Requirements

Once you’ve decided to retire, the Department of Defense (DoD) recommends you start prepping for it about 2 years before your target retirement date. According to the DoD's Military One Source, there are 4 must-do items:

  1. Schedule your initial and pre-separation counseling. These sessions must be completed a minimum of 365 days before your retirement date (but the DoD recommends starting 18-24 months ahead). You’ll complete a self-assessment, begin an Individual Transition Plan and learn about benefits, entitlements and resources.
  2. Attend TAP workshops. Transition Assistance Program (TAP) workshops are mandatory and include information such as how to define and translate military skills when applying for civilian jobs, financial literacy and planning, and employment and benefits offered from the Department of Veterans Affairs (VA).
  3. Schedule medical exams. You’ll need to complete a medical and dental exam a minimum of 90 days before your retirement date. (Make sure to get copies of your records.)
  4. Schedule your final move. You can complete your final move up to 1 year following your retirement date.

For more detailed suggestions for each step of your transition and advice on other things to consider, see Managing Your Transition Timeline (MYTT). You can also find service-specific tools and resources for servicemembers and their families on the Transition Assistance Program (TAP) website.

Finding a Job

If you plan to work after you leave the military, take time to consider the types of jobs that appeal to you. What skills honed during your military service would translate well to a civilian workplace?

Keep in mind, the sooner you begin your search, the better. Some things that may help include attending job fairs, visiting American Job Centers (AJC) and checking into Hiring Our Heroes’ resources and services. You can also use Military One Source up to a year after your transition.

Housing Considerations

You’re entitled to a government-paid move anywhere in the United States or to your home of record internationally. If you’ll be buying a home in your new location, consider applying for a VA home loan. VA loans offer many benefits you may not find with traditional mortgages. And, since they’re backed by the federal government, you’ll be more likely to find a loan with very attractive terms. As a Top 5 VA lender, Navy Federal’s VA loans don’t require a down payment or private mortgage insurance (PMI) and have low rates.

Note: One of the things many lenders look at when considering loan applications is whether the applicant has had continuous employment for more than 12 months prior to applying.

Health Insurance

If you’re retiring with 20 years or more of service, you’ll have a few plan options for yourself and eligible family members through TRICARE. Keep in mind you’ll need to enroll in one of these plans to keep your benefits. You can also enroll in dental and/or vision insurance, both of which require payment of a monthly premium.

If you have fewer than 20 years of service and plan to find another job, health insurance through your employer is often your best bet. But, you can find gap coverage through the Transitional Assistance Management Program and the Continued Health Care Benefit Program. If you won’t have access to a plan through work, review your options from the VA or your state’s Health Insurance Marketplace.

Your Retirement Budget

This final step may just be the most important of all. Your budget in retirement may look quite a bit different from your Active Duty one, especially if you opt not to work after retiring. So, it’s critical to get a handle on how much income you can reasonably expect and compare that to how you’ll expect to spend it—both set expenses and optional ones.

How Much Income Will You Have?

First, find out what your monthly income will be. In addition to your retirement income, factor in other types of non-disability pay based on the retirement system in which you’re participating, income from a job and investment income, if any. Of course, that number will be before federal and state taxes and other deductions, so you’ll need to subtract those amounts.

Note: Although your retirement pay will adjust periodically based on cost-of-living increases, you should start with the first year amount and adjust later, if needed.

What will your expenses be?

Once you know how much you have to work with, list out your monthly expenses, such as:

  • housing and utilities (including cable and internet)
  • food, clothing and transportation-related expenses
  • health, auto and other insurances
  • debt payments (e.g., alimony or child support, student or auto loans, credit card debt)
  • savings
  • subscriptions and entertainment
  • other tax payments (e.g., property taxes or state/federal taxes you owe due to insufficient withholdings)

It may help to track your costs over the next few months as you prepare for retirement. If you’ll be moving, be sure to account for any moving-related costs, like new furniture, appliances or repairs and upgrades you plan to make to your new home. You may not know the exact amounts of some bills, especially if they’ll be changing from your pre-retirement costs. So, plan to start with an estimate and continue to adjust as you live on your new budget.

We’re Here to Serve You

This transition is filled with exciting opportunities, and Navy Federal is here to help. We’ve conducted 2 studies: Best Cities After Service and Best Careers After Military Service to get you started. You can also learn more about smart planning for civilian life by reading our article, Transitioning From Military to Civilian Life.

Next Steps Next Steps

  1. If you know you plan on retiring within the next 2 years, get started on scheduling your initial and pre-separation counseling, TAP workshops, medical exams and final move.
  2. Take a look at your finances, including your assets, and make a determination about how much work, if any, you’ll need to do in retirement. Should you decide to keep working, start thinking about what kind of job would be compatible with your military experience!
  3. As you’re considering your post-retirement budget, don’t forget to factor in health care and your housing—plan to use your government-paid move wisely, perhaps even by buying a home with a VA loan.


This content is intended to provide general information and shouldn't be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.