Is it possible to retire as an enlisted person from the military without working?
Posted on Sep 26, 2009 under Retire |I am currently an E-3 in the military and contemplating doing 20 or more years in the service. I am currnently married with no kids. Is it possible to retire as an enlisted person and not have to work afterwards? Maybe it would be possible to just work part-time after retiremen?
Or is this only possible when retiring from the officer ranks?
1.) You can if you save your money and invest wisely–10% will not cut it. Begin saving your money from basic training. The sooner you start saving, the easier it is to accrue a larger sum of money that will build off interest. Also, NEVER dip into your savings/investment accounts unless it is an absolute emergency.
2.) If you get married, it is imperative that your spouse works to.
3.) You cannot eat out often, party lavishly, buy new cars (a lot of people do this in the military), or as a rule of thumb, use money in a haphazard fashion. Drinking, smoking, DRUGS (yes, people in the military use drugs more often than most would like to believe) and other money pits detrimental to your income.
4.) Deploy, deploy, deploy! There are tax benefits to deploying and you get paid more!
5.) Make rank the first time around and do not get in trouble! Getting in trouble will often reverse a lot of hard work, FAST!
6.) If you wish to retire comfortably, look at commissioning, the officers get paid A LOT more than enlisted. It is painful to see such a huge disparity in pay for little difference in work production. You can begin enlisted and later on get your commission. Plus, many officers can stay in longer due to their profession, nurses, lawyers, etc…
7.) Prepare for a job upon retiring, enlisted do not get paid a lot and the reality is that most will require a job afterwords. Do not let this keep you down though, find a passion, use the TA and MGI Bill to pay for the education necessary to do the job you want to do when you get out if you are not already doing your dream job as an enlisted man.
September 19th, 2009 at 6:44 pm
No. Not unless you make E-8/E-9 and do the full 30. If you’ve got a family there’s no way you can live on your retired pay.
As an Officer, O-5/O-6 with 25+ years you can do it if you’re careful.
**********You do NOT get BAH after you’re retired. Your retired pay is based on your average high 3 year base pay. Your retired pay is fully taxable. If you want Survivor’s Benefit Annuity (to pass your retirement along to wife/kids in the event you die) that’s deducted too.
Free medical? Hardly. Have you looked at the copays and deductibles on TriCare for Life?
You do not get free dental. You have to purchase dental insurance.
References :
Retired Chief Petty Officer
September 19th, 2009 at 6:45 pm
you can and working part time would be a good call it depends on what rank you make its not that great i have been told but you can live on it with extra income it should be ok.
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September 19th, 2009 at 6:45 pm
Of course, you will get your pension. But remember you will also have to save a lot of money form your pay as well. This will be easyer as you move up to higher enlisted levels, or if it is a carrear goal you might want to get a degree and become an officer. They get paid a lot more witch you can save. Investments help a lot also.
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September 19th, 2009 at 6:45 pm
depends on how much money you need to live.
dad retired as tech sgt with three kids. mom always worked and he got job after retiring.
we weren’t rich but was able to get a house after twenty years.
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September 19th, 2009 at 6:46 pm
You are going to need at least part time work.
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September 19th, 2009 at 6:46 pm
Well think about it buddy, you’ll get a pension of 50% of your rank’s pay after retiring from 20 years of service. You do the math.
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September 19th, 2009 at 6:46 pm
its possible but usually unless you do 30 as a chief then you will work. the pay is decent but most people still need to work. if you are serious about a life in the military you should look into commisioning because they pay a lot more. check out the pay chart and see. good luck
References :
air force
September 19th, 2009 at 6:46 pm
You could, but you would have to put in more than 20 years. Besides, assuming you are in your early twenties, you would retire in your early-mid forties. That is a lot of time to do nothing. Especially with a wife nagging you.
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September 19th, 2009 at 6:48 pm
That depends on a lot of factors. It depends on what rank you retire as. It depends on whether you have a family to support or not. It depends on where you want to live in retirement. It depends on the cost of living where you live when you retire. For example, if you retire as an E-9, no kids, no child support, no debts and a house nearly paid for in Alabama or some other low cost of living place, then it is quite possible. However, if you retire as say an E-7 with a wife and 2 kids to support and maybe one in college and a house payment and you are in a high cost area, it is not possible. You would have to get a full time job.
Edit: You do not receive BAH in retirement Eagle 1 Fox 2; just the earned percentage of your base pay. If you receive disability, that part of your retirement pay is not taxed federally. So, an E-7 does get about $2000 a month currently. However, you SGLI goes away and you will have the payments for Tricare to contend with so your pay will be a little lower. So if you get a decent job, your retirement pay will cover your mortgage in most places and your job will pay for your "fun".
Edit: Very good advice Larry!
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I’m retired and work full time….will retired again in 12 years and never work again.
September 19th, 2009 at 6:49 pm
Nope.
References :
Bear
USAF 1984-2006
September 19th, 2009 at 6:49 pm
LOL it sounds like you said, retire after 20 years not working ! That’s hilarious. Though I know a few NCOs who are giving it a try…
Yeah, you can live off a retirement check as long as you get to E8 and maybe do a couple a few years past 20. Trick is to live simply some place that is not expensive, like in the South, for instance. And make sure your future kids (if you have any) are aware you aren’t planning to pay for their college. (Nothing wrong with that, in my book, if you do not have money lying around.)
You might want to work part time though, at least, depending on the standard of living you want. Also, a lot of young retirees get bored and end up going back to work anyways. My grandfather retired three times. Third time finally stuck.
And remember, your wife gets a vote here.
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September 19th, 2009 at 6:51 pm
If you are very smart and careful with your money it is possible. Keep in mind that you will have to live a very frugal life both before and after retirement. But yeah it’s possible. Good luck.
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September 19th, 2009 at 7:01 pm
Hello WarCry…
Ha… I’m laughing.
The honest answer is YES you can.
But, you have to do certain things for this to happen and you have to start immediately.
#1. You must NOT buy any new cars.
#2. You must not spend your money on pizzas.
#3. You must not spend your money on beer.
#4. You must not spend your money on cigarettes.
All these things over a 20 year period will be the seed money that you need to invest so that you do NOT have to work after retirement.
What you have to do is INVEST a minimum of 10% of your net pay into a deferred savings program. You need to start an IRA for retirement.
Now, I didn’t learn how to do this until I was in my 40s. So, after I retired from the Air Force with 27 years I had to go to work for 12 more years as a County Probation Officer (I completed my B.S. degree while in the Air Force - required to be a Probation Officer in my state) and retired a second time with a pension.
I retired at age 48 from the Air Force and retired at age 59 from the County. Then, when I became 62 years old, I began to draw my social security pension.
I have been retired since 2001 and as long as I don’t buy new cars I don’t have to worry about making 60 car payments.
Also, I have another IRA which I won’t touch until I am 70 years old.
Yes you can do it.
Learn to PAY YOURSELF FIRST (after the government takes out it’s share in taxes, of course) and then when you get promoted or get cost of living raises don’t spend that money, add it to your savings IRA and live on 2 levels lower than your current rank.
Over 40 years time you will earn enough money to live on without working. Most people do not have the discipline to do this, however, because they want new cars every 4 years, big screen LCD TVs and all sorts of fancy "stuff."
Best wishes,
Larry Smith
SMSgt, USAF (Ret.)
First Sergeant
References :
Previous military experience of 27 years: 1961 - 1989
September 19th, 2009 at 7:03 pm
Enlisted personnel are often times required to retire after 20 years. This means that you will get 50% of the average of the the three highest paying years while you were on active duty, and this is true to both noncommissioned and commissioned personnel. If your highest pay was let’s say $4000, you will get $2000 plus health benefits. Remember that your retirement pay will increase at a rate equal or greater but not lesser to the inflation rate in order to keep you from "going under" However, if you are able to make it E-8 or E-9 (in reality it depends on performance), you will most likely be able to continue in the military. This is good because each year that passes after the 20 years, your retirement pay will be increase at a 2.5 or so percent up to 75%. Of course, if you are an officer, you can easily make more than 10k a month and retire in 20 years and get 5k per month.
Good luck
References :
http://usmilitary.about.com/cs/generalpay/a/retirementpay.htm
September 19th, 2009 at 8:00 pm
It entirely depends on what you want for a lifestyle. If you save money while you are in the service, and own a home before you get out, it is entirely possible to live comfortably without ever having another full time job. Just don’t plan on vacations on the Riviera.
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September 19th, 2009 at 8:25 pm
Obviously that would be determined largely by your rank when you retired…… the lifestyle you want when you retire……what you do with your money while you are in the service …… and where you retired
It is definitely possible to retire as an enlisted man and never do a lick of work the rest of your life…..
If you want some suggestions email me…..
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September 20th, 2009 at 2:45 pm
what is your goal for which rank you want to retire at? then you can figure out what kind of employment afterwards you’ll need.
I’d recommend saving up now-for later, you’ve got the time for your money to double over at least once and close to twice. Better than trying to save at the end of your career. Anyways, just look at how much 50 percent would be and realize it’s enough money for a home,
car payment and some groceries. then you can be picky on the type of part time job you need to have.
Just ask your buddies how much they have saved up so far, then your sergeants, platoon sergeants, you’d be surprised in the similarity…
not much saved and if you find someone who has a lot, copy what they did!
Just make your way to a pre-retirement briefing to see what you really get. I bet you would be congratulated by the soon to be retired ones for learning at an early age what to prepare for.
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20 plus years, retiring soon, wish I could have saved all that money I blew my first 8 years as a single soldier.
September 21st, 2009 at 11:21 am
1.) You can if you save your money and invest wisely–10% will not cut it. Begin saving your money from basic training. The sooner you start saving, the easier it is to accrue a larger sum of money that will build off interest. Also, NEVER dip into your savings/investment accounts unless it is an absolute emergency.
2.) If you get married, it is imperative that your spouse works to.
3.) You cannot eat out often, party lavishly, buy new cars (a lot of people do this in the military), or as a rule of thumb, use money in a haphazard fashion. Drinking, smoking, DRUGS (yes, people in the military use drugs more often than most would like to believe) and other money pits detrimental to your income.
4.) Deploy, deploy, deploy! There are tax benefits to deploying and you get paid more!
5.) Make rank the first time around and do not get in trouble! Getting in trouble will often reverse a lot of hard work, FAST!
6.) If you wish to retire comfortably, look at commissioning, the officers get paid A LOT more than enlisted. It is painful to see such a huge disparity in pay for little difference in work production. You can begin enlisted and later on get your commission. Plus, many officers can stay in longer due to their profession, nurses, lawyers, etc…
7.) Prepare for a job upon retiring, enlisted do not get paid a lot and the reality is that most will require a job afterwords. Do not let this keep you down though, find a passion, use the TA and MGI Bill to pay for the education necessary to do the job you want to do when you get out if you are not already doing your dream job as an enlisted man.
References :
7-Year NCO, who is 5 classes away from a commission and saving at least 40% a month for the past 2 years (had to grow up before I reality set in). Married with one child.