04/10/2016 by Melissa C. Martin
9 ways to transition into military retirement
This article is timely, because next week, I am to speak at a SCAN (second career assistance network) seminar for outgoing military
members later this month in Kingston, Ontario.
For some, retiring from the military may be a viable option.
Let’s be completely honest. Everyone has his/her own dreams and expectations about retirement. Upon retirement, some folks plan to travel around the world while others simply plan to take excursions to their local beach. Whatever the retirement plan you choose, the ability to implement your goals takes a certain degree of financial security.
The problem however is that financial security does not just happen but requires careful planning, commitment and yes, money.
In previous posts, I have suggested an eighteen month timeline is ideal when planning to leave the military.
site for details).
To be a successful retiree, you must successfully transition yourself
into retirement to meet your retirement objectives. In addition, you
have to plan the amount of money you need and what you want to
accomplish with your savings. This article will discuss 9 ways that you
can successfully transition yourself into retirement.
They are as follows:
1. Debt Reduction – Make sure that you do not carry your debts into retirement. If necessary, speak to a certified fianancial planner or counsellor to manage your existing debt load. Another option is to access SISIP at military bases across Canada.
Therefore, commit yourself to paying off as much of your debts as you possibly can. Eliminate car payments, credit card debts, personal loans, etc. Do what you have to do now to squash debt and make sure that you don’t obtain any new debts either.
2. Have a Nest Egg of Emergency Funds – Have enough liquid funds in hand to cover at least a few months of expenses, without eating into your investments. Be prepared for unexpected expenses while you transition into retirement. After all, emergencies will certainly come up but if you have a certain amount of savings, you won’t have to worry about them.
3. Adequate Insurance Coverage – Make sure that you have adequate insurance to cover your life, health, homeowner and auto insurance policies. Reassess your insurance needs yearly, to ensure that they suit your retirement needs. Be open to making changes as needed and check out your unit’s retirement coverage. Some retiring or releasing military members have been unpleasantly surprised to learn that their employers will no longer cover their medical expenses after
they retire. So, if you find out now, you can take the necessary steps to protect yourself and your family.
4. Retirement Income Plan – To ensure that you don’t outlive your assets, develop a retirement income plan that includes
your income and expenses. Keep track of your current expenses and cut back as needed.
5. Social Security Benefits – The rules for benefits are rather complex, so talk to a Social Security representative a year
before you plan to retire. By doing this, you’ll be able to understand your benefits and how much you’re covered. In addition, you should apply for social security three months before you want to start collecting your benefits or three months before your 65th birthday. Speak to a representative at CRA (Canada Revenue Agency) or the IRS in the U.S. about your unique situation.
6. Contribute to a Savings Plan – If your employer offers a tax-sheltered savings plan (such as a 401KSge difference in your financial security
due to the magic of compounded interest.
7. Review Wills and Trusts – Make sure that you have a valid will and/or trust. Not only will this protect your assets but will give you peace of mind.
8. Invest in IRA – By putting money in an Individual Retirement Account (IRA), you’ll cleverly delay paying taxes on investment earnings.
9. Follow Basic Investment Principles – Just remember that how much you have for retirement depends on the type of
investments you make now. Learn how to multiply your savings using mutual funds, stocks, bonds, etc. Consult a financial advisor for
Bilingual Military to Civilian Transition Coach
Linkedin group: military to civilian employment