[USER]

Looking For Guidance..
Hello all,
I’m a 38yo military member thats a little over 3 years away from retiring from the service. I’m also expecting my first child later this year.

I’ve currently got ~56k in my TSP (military 401k equivalent), ~30k in savings, and no debt.

I don’t feel like I’m starting from zero but I do feel like I haven’t prepared enough for a transition to civilian life and especially with a kiddo on the way.

Any investment guidance I could get would be much appreciated.

[Muhammad]

Your focus should be on steady cash flow and long-term investments. Alongside traditional investments like index funds or REITs, you might also consider income-generating digital assets.

For example, e-commerce allows for flexibility and can provide consistent monthly profits.

Many people start private-label stores, scale them over time, and even flip them for a larger payout later.

[Rodriguez]

Not advice* I was a TAP manager and a financial counselor for the military and would suggest the following:

1. Your time in service compared with the current savings/investing suggests that you probably could maximize your spend plan to reduce spending and add to these categories.

2. Visit the financial counseling service on the base that is free for you.

They’re located either at your family readiness center or there might also be a personal financial counselor contractor as well. The readiness center will have their info too.

3. Ensure that your TSP is invested properly based on tolerance for risk and the fact that you will not touch it for another 21 years more than likely.

4. Do you and your spouse have a Roth IRA?

5. Visit the doctor and properly document health issues. This is crucial for proper VA benefits ratings.

6. When you reach month 24 from retirement, go to the TAP briefing. Go early.

7. Build up a transition fund. I’d say to cover at least the difference between current pay and your pension, which will start day 1 of retirement at 41.

8. Keep the emergency funds separate.

9. You’ll be tempted to start saving for the baby’s college. If you do, be minimal about it. As a veteran, some states offer free college to kids of vets with certain levels of disability.

I don’t know if that will be your case, but either way you need the money more now. You could do this part when you’re more stable.

10. Keep the debt at 0
and cut back spending. Including for baby stuff.

11. If there’s room to invest further, it would be good. But seek out the fiduciary financial counselors to understand it. Don’t trust just anyone.

12. You’ll be able to leverage several benefits for education that will provide some income. Use them!

*Not advice*
My spouse is a retiree and it’s a great benefit to have. You will be fine ultimately. Congratulations!

[Elena]

Hubby is retired, and I’m still in. You need to make a decision on what comfortable and free at retirement transition ACTUALLY looks like.

If you’re AD, you are a master planner. And you executed really well. So, lean on that skill.

What is the desired end state for your mission? Would $50k in a HYSA feel really good? Does having a fat down payment for a forever home bring peace?

What would need to happen for you to feel joy, peace, and financial empowerment as you sunset your military career?

Once you know that, the plan will make itself apparent. Holler if you wanna chat

[Derek]

Just retired active duty last year. Hands down the most important thing you can be doing is making sure your medical records are accurate and that any/every issue you have has been identified in those records.

Any other issues you haven’t been seen for need to be your priority until retirement.

Make sure to request referrals and follow up with any other appointments that are offered.

Also start looking into the VA process and CFR 38 Sub part B which lists all claim ratings and their corresponding criteria.

If you want to DM me I’d be happy to answer specific questions.

[Amanda]

If you and your spouse don’t already have a Roth IRA, open them now and Max out for 2024 ($7k ea) now and 2025 when you can. Increase your TSP contributions to max ($23,500/year).

What is your housing situation? Without currently owning (unless you do own and are debt free, then kudos!) you probably need to start thinking about that – where will you live, will you buy, etc.

My husband is also a little over 3 years from retirement, but we don’t know where we’ll live or what his plans career wise will be.

[Jill]

I’m not sure what your experience, education or desires are for a future career outside of the military but I think that’s something to start thinking about- what is it you want to do afterwards?

TAPS (or whatever they call it these days) now has three different avenues to pick from employment, education and entrepreneurship. Start thinking on what do you want to do after service.

Second thing is finances. As someone mentioned, a good savings for emergencies as well as your transition in case you don’t find a job right away.

You don’t have to roll your TSP into an IRA or 401k in fact read up on it- TSP has some of the lowest rates. You can choose to keep it there.

Start creating your checklist 24-36 months out on what administrative stuff you need to accomplish and by what deadlines, and create a plan with your spouse on where you want to live, when you start house hunting if you are not staying in the area, what the job market and cost of living look like in the area you’ll be in so you can create a plan of attack for the transition.

Create a job log so you can track all the employers you applied to and be able to follow up on.

Have a resume and cover letter ready. You’ll have a chance to work on these in TAPS.

Remember you will be authorized terminal leave on top of TDY for house hunting and job hunting. Use that paid time well.

There are military employment/veteran placement agencies like Bradley-Morris and many others that can help you find employment- at no cost to you.

Start looking at those.

[Liz]

Right now, with everything going on, I would continue growing your emergency fund.

Then move into index funds if you aren’t going to touch the money for 5-10 years.

[Tien]

Hey congrats on your newborn! Thank you for your service! I worked with a few military folks when I was in Virginia Beach. I’m familiar with how your TSP works and SGLI.

I may can give some advice on what to do with your TSP.

Please send me a DM and we can discuss further. My service is free.

[Author]

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