Transitioning Out

Transitioning out of your military career and into civilian life can be complex. Learn the ins and outs to make yours go smoothly.

Retirement ceremony

Whether you measure your service in years or decades, making the transition to civilian life can be challenging.

Military to Civilian transition

Military life offers a sense of routine, purpose, and comradery that may be difficult to find in the civilian world. Fortunately, there are many resources to help you, your family, and your finances transition to the next chapter of life. Consider implementing these activities to keep your financial life anchored throughout all the change.

12 to 18 Months Out

1. Make an appointment with a transition counselor at your duty station.

It may seem like you have plenty of time before your time in the military is done, but it will go by quickly. The transition counselor can provide support and resources now to help you make the most of your time remaining in the military and ease the transition.

2. Consider your options for post-military life.

There are many options to consider such as school, work, and relocation.

3. Attend the Transition Assistance Program (TAP) Course.

Attend the Transition Assistance Program (TAP) course on your installation or online, if permissible. If you’re married, encourage your spouse to attend so they understand what post-military life will look like, too.

4. Build up your network.

A military career provides Service members with countless skills, but figuring out how to translate these to civilian life can be complex. Stay connected and learn from your old teammates, mentors, and peers as they transition out of the service. It’s important to build a civilian network and the easiest way to start is with the people you already know. You never know if that old drill sergeant from basic can help you with your next job!

5. Save for your transition.

Consider boosting your emergency fund to help bridge the transition to civilian life. It should be large enough to cover three to six months of living expenses. This money will help you to cover household expenses while you search for the right job, not the first job.

6. Consider joining the Reserves or National Guard.

There are financial advantages continuing to earn retirement, education, and healthcare benefits while continuing your service in the Reserves or National Guard. You can even earn additional pay on top of your civilian income. Apart from money, you may find that you miss the friendships and comradery you built on active duty.

9 to 12 Months Out

1. Prepare for your next career.

Whether you plan on working for yourself or someone else, establish a gameplan for your next chapter in life. This could include gaining certifications, applying for college and scholarships, or networking with potential employers.

2. Begin your job search.

Assess your skills and interests to guide your job search, and update your resume with a career counselor at your installation’s Family Readiness Center. You can also access the DoD Career Ready portal to discover career opportunities, or get networking tips with Career OneStop.

If you’re married, this is also a transition for your spouse too. If they intend to gain or change employment, MilSpouse Money Mission can help them learn how to leverage employment benefits.

3. Learn more about civilian employer benefits.

You may find that compensation is very different with a civilian job, especially when it comes to taxes, vacation time and benefits. Use the Regular Military Compensation (RMC) Calculator to estimate an equivalent civilian salary. This knowledge will help you when it comes to negotiating salary and benefits with civilian employers.

6 to 9 Months Out

1. Plan for your next home.

Research cost of living, schools, and housing options for your next location. If you will be purchasing a home, get your credit in good shape before applying for a mortgage. Check your credit report at and correct any errors.

2. Start applying for jobs.

Mobilize your updated resume and lean on your network to locate and apply for jobs. You may want to join professional or trade associations to help with networking and finding job opportunities. Check out DOD SkillBridge to gain valuable real-world civilian work experience and training.

3. Update your estate plan.

Separation or retirement is a great time to review and update your estate documents and account beneficiaries. Visit your installation’s legal office if you need assistance.

Consider the following documents in your review:

  • Last will and testament
  • Power of attorney (POA)
  • Living will
  • Medical power of attorney
  • Testamentary or non-testamentary trust

Also, review the beneficiaries on your life insurance policies and investment accounts to make sure they are up to date.

3 to 6 Months Out

1. Explore your military benefits.

  • Relocation assistance: You have one year from your retirement date to use your last government-paid move. Military OneSource has great relocation resources and consultants available to help along the way.
  • Education benefits: Military service provides some great educational benefits for veterans and family members. Find education and career counseling or apply for GI Bill benefits to pay for further education.
  • State-specific benefits: Visit your state’s Veterans Affairs Commission and research potential benefits such as tax, education, housing, employment, and recreation benefits. Visit the U.S. Department of Education to learn about education benefits offered to military families and veterans.

2. Square away your health insurance.

Most health insurance programs have windows of eligibility, so make sure your family has a plan to prevent any gaps in coverage. Here are options to consider for health care coverage for life after the military:

  • Review and sign up for any civilian health insurance if provided by a new employer. Ideally, a new employer plan will serve as primary coverage for your family, similar to the TRICARE coverage you’ve had with the military.
  • The Continued Health Care Benefit Program (CHCBP) is a premium-based, civilian-sponsored plan that provides temporary coverage when you lose eligibility for TRICARE. Coverage is limited to 18–36 months and must be purchased within 60 days of separation.
  • The Transitional Assistance Management Program (TAMP) is available to some members transitioning from active duty.
  • Veterans Affairs health care may be an option for coverage. However, the VA does not provide coverage for family members.
  • Check out the Affordable Care Act’s Healthcare Marketplace.
  • If you join the Reserve Component, TRICARE Reserve Select® offers a low-cost healthcare option.

Note: Acquire a copy of health care records for all members of your family before separation.

3. Review your life insurance needs and policies.

During service, you were likely covered under Servicemembers’ Group Life Insurance (SGLI). SGLI coverage typically ends 120 days after separation from service, so assuming you still need coverage, make sure you have new life insurance in place before it expires.

One option for coverage is through the Veterans’ Group Life Insurance (VGLI) program, which allows Service members who were covered under SGLI to continue coverage. Veterans can apply for coverage within one year and 120 days after separation from service. If you apply within 240 days of separation, you will not be required to submit health-related information. VGLI provides coverage as long as you pay the premiums, which are based on age.

Another option is to purchase a private life insurance policy. Most providers require a health screening or medical exam to prove insurability. To avoid a possible lapse in life insurance coverage, it’s a good idea to apply well in advance of separating so you will know your options for a private policy versus VGLI.

4. Make a decision on the Survivor Benefit Plan (SBP).

If you are retiring from the military, you will need to make a decision on the Survivor Benefit Plan (SBP). If elected, the SBP provides an eligible beneficiary with monthly income (called an annuity) after your death. This annuity is a monthly payment for the lifetime of the beneficiary and is a percentage of your retirement pay. Enrollment is not automatic, and there are costs. Be sure to do your homework before retirement so you can select the best option for your family. Upon the death of the Service member, a spouse and/or children may receive payments only if the SBP was elected.

5. Learn more about Wounded Warrior Programs.

If you have a service-connected illness or injury, it’s important to contact your Service’s Wounded Warrior Program. Visit Military OneSource for more information on the enrollment process.

6. Learn about the VA disability benefits claim process.

Gather your medical records and schedule necessary medical appointments if you have an illness or injury that you believe was caused—or made worse—by your active duty service. You can file a claim for disability benefits 90 to 180 days before you leave the military. You can find out how to file a claim through the Benefits Delivery at Discharge (BDD) program offered by the VA.

1 to 3 Months Out

1. Plan for Military Retired Pay.

If you are retiring from either the Legacy (High-3) Retirement System or Blended Retirement System (BRS), be sure to factor Military Retired Pay into your future budget. If you are separating from the military rather than retiring, you will not be eligible for Military Retired Pay.

Military Retired Pay under Legacy System

  • Requires 20 qualifying years of service to receive a pension benefit.
  • Retired Pay is determined by your years of service. It’s calculated at 2.5% times years served times your highest 36 months of basic pay.
  • Periodically adjusted for inflation based on the cost-of-living index.
  • Benefit starts immediately for Service members retiring from active duty and typically starts at age 60 for Reserve and Guard members.
Calculating your monthly pension
Calculating the Monthly Pension: 2.5% x Years Served x Retired Monthly Base Pay (average for the highest 36 months of basic pay). *Reserve members divide accumulated retirement points by 360 for “Years Served,” assuming they have earned enough qualifying years towards retirement.

Military Retired Pay under BRS

  • Requires 20 qualifying years of service to receive a pension benefit.
  • Retired Pay is determined by your years of service. It’s calculated at 2.0% times years served times your highest 36 months of basic pay.
  • Periodically adjusted for inflation based on the cost-of-living index.
  • Benefit starts immediately for Service members retiring from active duty and typically starts at age 60 for Reserve and Guard members.
  • Offers a Lump-sum Option. Service members retiring under BRS can choose to receive a 25% or 50% discounted portion of their monthly pension in exchange for a lump-sum payment. The pension reverts to the entire amount at the Social Security age of full retirement, which for most is 67. Use our BRS Lump Sum calculator to estimate your options.
Calculating the Monthly Pension
Calculating the Monthly Pension: 2% x Years Served x Retired Monthly Base Pay (average for the highest 36 months of basic pay). *Reserve members divide accumulated retirement points by 360 for “Years Served,” assuming they have earned enough qualifying years towards retirement.

2. Review your TSP.

You have several options for the money in your TSP account when separating or retiring from service. You can:

  • Leave it in the TSP. This option is available as long as there is at least $200 in the account. Investment allocations can continue to be adjusted in the account, but future contributions are limited to rollovers of IRAs or eligible employer plans.
  • Roll it into an Individual Retirement Account (IRA). You can transfer or roll over your TSP balance directly into a Traditional or Roth IRA with no tax consequences, with some requirements. Learn about Individual Retirement Accounts: Traditional and Roth IRAs.
  • Transfer or roll over money to an eligible employer plan. If your new employer offers a company retirement plan, you may be able to move your TSP balance into that plan tax-free, if the new plan allows.
  • Withdraw all or part of your money. If you are younger than age 59½, then taxes and penalties may apply.

One additional note about the Thrift Savings Plan (TSP) for Service members covered by the Blended Retirement System. Automatic and Matching contributions are not fully vested (yours to keep) until you complete a two-year service requirement. This means some of the TSP balance may be forfeited if you are separating before completing two years of service.

3. Build your civilian budget.

Hopefully by this time you have a good handle on where you will be living and what you will be doing for work. However, don’t worry if you are still fine tuning your options. That said, it’s a good time to work on your civilian budget. This Spending Plan Worksheet can help you bring everything together.

Take a conservative approach to estimating your projected income and expenses. This means to slightly over budget for expenses and under budget for income. One major factor that transitioning Service members do not account for in their monthly cash flow is taxes. Some types of military pay and allowances are tax-exempt, but this will not be the case in the civilian sector. If you are moving, state and local tax rates may be different in comparison to your current location. Research these differences and visit with your installation’s personal financial counselor or a tax professional ahead of time to plan for tax expenses. For additional help, visit Military OneSource MilTax tax services.

4. Review your auto and property insurance policies.

Your insurance needs may change if you plan to move after separating or retiring. Review your policies to make sure your coverage is sufficient for your current location and needs. The cost of auto and property insurance may also change depending on your location. Make sure to include accurate costs as you build your civilian budget.

5. Update contact details for key websites.

If you use your military email or CAC to log into websites, be sure to update your email address to your civilian account. Also, look into setting up a DS Logon account to gain access to key sites.


Additional Resources

There is plenty more help at hand as you retire or separate from the military. Check out these key resources:

Department of Defense Transition Assistance Program (TAP) will help you plan your transition to civilian life.

DoD FINRED can provide financial planning tools.

Military OneSource provides resources and information and full access to services for one year after transitioning.

Department of Veterans Affairs supports veterans and families with resources for health care, education, and more.