“Should I stay or should I go?” - The Clash, 1982
The most important element of your financial plan is your career. When should you leave the military and transition to civilian life? Obviously the answer is different for everyone, but here I offer some pros and cons at the three most common transition points for officers:
Early Career: You commissioned right out of college and served your initial commitment of a few years. You’re now approaching your late 20s and want to enter the civilian world.
Pros: You’re young and can easily reinvent yourself in whatever civilian field you wish to pursue. You had great experience and responsibility at a young age, which is a valuable skill to take to a civilian job. You’re young enough to easily pursue medical, law, or business school if you want. You likely don’t have huge family obligations yet so can afford some risk when it comes to choosing what to do and where to live. If it doesn’t work out, you still have plenty of time to change again.
Cons: You feel behind peers who are your age but have been building their civilian careers for the past few years. You don’t get the same leadership opportunities as you had in the military. You’re not “entry-level” but don’t really qualify as having enough relevant experience in career fields unrelated to defense and government. Your network is still small, and not knowing what's out there can turn into fear of the unknown.
Mid-Career: You stayed in after your initial commitment, but now either by choice or force, you are getting out in your early 30s.
Pros: You have more experience and can hopefully jump into a leadership role in the civilian world. You’re still young enough to reinvent yourself if you want to change professions but will also have great opportunities in the defense industry, either for the government or a government contractor.
Cons: You’re halfway to a pension which has a huge value if you stay in the military a few years longer. It is a hard emotional transition leaving the world you have known for the past 10+ years and you feel a little old to be “starting over.” You may have a growing family with more obligations than you did a few years before making it more difficult to take risk in your civilian career.
End of Military Career: You stayed until at least 20 years of service and are retiring from a long military career.
Pros: You receive a sizeable pension (even with the upcoming changes) which will enable you to have some financial flexibility. You will likely have opportunities to enter the defense industry (government or private sector) in a senior level role. You know well how the military works and can translate that experience into a meaningful and successful career as a civilian.
Cons: It’s probably a little late to make a total career pivot. It’s not that it can’t be done but it’s unlikely you would want to go back to school or start back at the ground floor of an industry you have no experience in. The vast majority of people who retire from the military (at least where I live in the DC area) stay in the defense industry or government.
When weighing the pros and cons of staying in or getting out, many guesses and assumptions will be made. Hopefully this list gives you some perspective. Like any good financial plan, we make the best decisions we can with the information available at the time and carry on.