Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Military vs. Civilian
Old 07-05-2006, 07:52 AM   #1
Recycles dryer sheets
 
Join Date: Jul 2006
Posts: 227
Military vs. Civilian

Military vs. Civilian

This has been my own internal debate for a long time. I am currently tailoring my FIRE plan to my military situation but I always wonder is the civilian grass greener?

In your opinion, what are the pros and con’s of each?

Military:

Lower Pay
Frequent Moves
No 401k match
Pension after 20
Health Insurance after 20

Civilian:

Higher Pay
Fewer Moves
401k match
No pension, Defined Contribution
No health insurance

I’ve got 6 years active and 10 years total. The pension keeps me going because of the thought of walking away with a COLA’d income after 20.

Is the pension really worth not being a civilian and getting those matching funds?
__________________

__________________
"Those who think it cannot be done, need to stay out of the way of those of us doing it."
PsyopRanger is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: Military vs. Civilian
Old 07-05-2006, 08:12 AM   #2
Recycles dryer sheets
 
Join Date: Oct 2003
Posts: 452
Re: Military vs. Civilian

I have a friend who retired from the Army after 20 years, age=early forties,
had a civilian job waiting for him that paid the same as his military pay, plus had the Army retirement starting immediately ! Not too bad !
Now he can contribute to SS and 401k.
At age 62, he can get his SS, his 401k, and continue to get the military pension.
If you have 10 years to go, my recommendation would be to stay in the military,
assuming you like it there.
The grass is not always greener on the other side, no matter where you are.

__________________

__________________
renferme is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 08:15 AM   #3
Recycles dryer sheets
 
Join Date: Jul 2006
Posts: 227
Re: Military vs. Civilian

Quote:
Originally Posted by bennevis
I have a friend who retired from the Army after 20 years, age=early forties,
had a civilian job waiting for him that paid the same as his military pay, plus had the Army retirement starting immediately ! Not too bad !

But that leaves me working not ER?
__________________
"Those who think it cannot be done, need to stay out of the way of those of us doing it."
PsyopRanger is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 08:16 AM   #4
Recycles dryer sheets
 
Join Date: Oct 2003
Posts: 452
Re: Military vs. Civilian

read my edited post above.
.
Is military pension enough to early retire on ?
__________________
renferme is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 08:27 AM   #5
Thinks s/he gets paid by the post
OAG's Avatar
 
Join Date: Jun 2006
Location: Central, Ohio, USA
Posts: 2,598
Re: Military vs. Civilian

Depends on a lot of factors that at your age (I am guessing about 23-27 or so) it is hard to really know for sure. I will give you my facts and you can use them as you want to. Joined Military at 17 as a E-1, retired at 38 as a W4 - all service in Army. HS drop out at time or enlistment; college graduate (BS in Business) at time of retirement. Made 17 moves, married 4 kids. No 401K, no savings until AFTER retirement. I do not think I would have done it any different, loved most of the assignments, locations etc. There were times in those 21 years when I wanted to just quit, lucky to have had a couple of friends that talked me out of doing that. Since retirement (now in the 27th year; retired in 1979) I really thank the fact I have that Military Retirement Pay Deposit every month and it has almost tripled in COLA's dollars; it is a great help. Of course you will have to save, save, save, outside of the retirement in order to retire early but, depending when you went in and when you will reach 20 years AD, you should be young enough to do another full career before reaching 60 years old. Thats my $.02, I am sure you will get many more and varied responses to this question. By the way do not discount the medical insurance/care it is really becoming a very costly factor in retirement and is a great asset to have.
__________________
Vietnam Veteran, CW4 USA, Retired 1979
OAG is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 08:37 AM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Re: Military vs. Civilian

Quote:
Originally Posted by R Wood
married 4 kids
I doubt that's legal even in Utah. Thailand, maybe?
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 08:50 AM   #7
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,620
Re: Military vs. Civilian

Quote:
Originally Posted by PsyopRanger
Is the pension really worth not being a civilian and getting those matching funds? *
If the only thing keeping you in the military is the money then you'd better get out while you're still alive and (relatively) uninjured.

If you think that matching funds are all that they're cracked up to be then start a separate thread and take a poll among the board members. *I suspect that it's greener pastures.

If you're looking for greener pastures then contact a headhunter. *(I have shipmates in the business and 10 years ago I had several of them on speed dial.) *They'll tell you to expect an immediate pay dip as you make the transition, followed a few years down the road by better pay as you gain skills that civilian industry actually pays for. *It's like starting all over again at E-3 pay equivalence until you're considered to be "worth something". *And I know a couple people who can't contribute to their 401(k) or even get medical insurance until a probationary period has passed. *A decade later you may be better off than when you were active duty... or you may not.

A common thread among those who've left the military and excelled at their civilian career is "Great fun while it lasted but this is way better." *They've found their avocation. *A common thread among those who've left & struggled is "I miss the ethics, the camaraderie, and the sense of mission." *They only have a job. *I suspect that the former are internally motivated and the latter need the external boost. *You have to decide which category applies to you.

I thoroughly enjoyed the first 10 years but struggled to juggle family/work priorities for the next 10. *I made it but at times it was downright ugly and the lack of money was rarely as much of an issue as the quality of the life. *The pension is great and life is good but lately I've been wondering if my "Woo-hoo!!" attitude toward freedom and my allergic reaction to employment is the result of that final 10 years. *(Not that I'm complaining!) *If I had to do it all over again I'd have joined the Reserves when we started a family. *We would have had much more control over if/when we moved and worked, and the pension would "only" have been delayed by 19 years. *Continuity of paychecks is over-rated compared to having a measure of control over your life.

In the mid-90s a junior officer I worked with suffered through the same retention ambivalence during his first shore tour. *When the assignment officer visited our command and essentially peed on him in public to mark his territory, the JO decided that anything else had to be better. *He struggled with Lucas for several months before Lucas noted "You suck at getting hired but you're excellent at the career-search process" and hired him as a headhunter. *A few months later he conceived Lucas' first division dedicated to finding careers for retiring enlisted technicians, an area that they'd overlooked in the traditional food fight for junior officers. *His money has been huge and he smiles on the way to work every morning. *He's never looked back and he doesn't miss the military a bit.

OTOH the guy who helped him get started at Lucas has been in the Reserves for nearly 20 years (left active duty the minute his obligation was up) and is a Blue & Gold officer for the Naval Academy. *He's found a way to keep a foot in both worlds and he's doing great in both of them.
__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 09:02 AM   #8
Thinks s/he gets paid by the post
Eagle43's Avatar
 
Join Date: Jan 2005
Location: DFW
Posts: 1,883
Re: Military vs. Civilian

21 years military, followed by 22 years at Mega-corp. I agree with NORDS that staying in military for money might disappoint you or get you killed.* Remember I did both indentured servitudes.* OTOH, It rains checks at my house every month.* Best decision I ever made was to stay.* It seemed like a long time, those 20 years until retirement, but it's been 25 years since I left the military. TRICARE is a bargain and a big player.* I'd probably still be working, were it not for TRICARE.* Can you do it on a military pension alone?* I guess so, but it never crossed my mind.*
__________________
Resist much. Obey Little. . . . Ed Abbey

Disclaimer: My Posts are for my amusement only.
Eagle43 is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 09:11 AM   #9
Full time employment: Posting here.
 
Join Date: Feb 2006
Posts: 784
Re: Military vs. Civilian

Quote:
Originally Posted by brewer12345
I doubt that's legal even in Utah. Thailand, maybe?
Sounds like he's somewhere in the Muslim world...

Unless, of course, he meant that he "married them" to other people, since he's a minister......


__________________
Cool Dood is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 01:01 PM   #10
Recycles dryer sheets
 
Join Date: Oct 2005
Posts: 443
Re: Military vs. Civilian

Both are bad choices.

In my opinion, both choices are totally based on security, steady paycheck, guarantee sick leave, annual leave and insurance. It's only good if you are NOT a "mover and shaker" and tends to seek stable life for yourself and family.

Everyone in my family who work for themselves are much better off than i am and also much much closer to RE, eventhough they sometime struggle and got more sleepless nite. Over all, if i to do it again, both military and civilian are NOT my choice.

enuff
__________________
Enuff2Eat is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 01:04 PM   #11
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Re: Military vs. Civilian

Quote:
Originally Posted by Cool Dood
Unless, of course, he meant that he "married them" to other people, since he's a minister......
I think most states (let alone most denominations) would frown on marrying off 8 year olds...
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 01:07 PM   #12
Recycles dryer sheets
 
Join Date: Feb 2006
Posts: 403
Re: Military vs. Civilian

Psyop if you are proficient in Arabic and have security clearance from the military, I am sure you could retire and work for the Gov in a position at the CIA, NSA, or similar agency. You would probably make more and you could roll your time served over into the civil service 20 year retirement track. You would also have more flexibility to earn money from overtime and you could spend more time with your family. Your risk of being blown up would decrease substantially. After 20 years I hear you can retire and double your income by doing the exact same job in the exact same office with the exact same co-workers, working for a private defense contractor rather than the government directly. Maybe this could be an option for you when you get tired of moving around.
__________________
macdaddy is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 01:31 PM   #13
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: May 2004
Posts: 11,615
Re: Military vs. Civilian

PsyopRanger,

The miltary pension is a very big deal. COLA'd and about as secure as these things can get, it can be the bedrock of your retirement income stream. The pension allows you to take more risk with your other investments (e.g. I've got few bonds in my portfolio, and have a larger than average share of small-cap and value equities than I'd feel comfortable with otherwise). The health care insurance is likewise very big--it is probably the largest concern of the folks on this board who are in their ER years. If you shop for civilian coverage you'll quickly appreciate the value of TRICARE. It's far from perfect, but it's way better than nothing.

During my AD years I thought of the pension and the retirement health care as "deferred overtime pay." I think a miltary career is a great springboard for ER. As Nords has noted, too few military folks plan ahead or have event thought of really retiring when they hang up their uniforms. Wait until you get into your TAP class, you'll immediately see this.

You already know the "con side" of the contract with Uncle Sam. In addition, as you fully appreciate, your Arabic language skills and other training could fetch a hefty premium in today's market. The work, though, woud probably be similar in many ways to what you can expect in the coming years--lots of time abroad.

If you've got, effectively, 6 years AD credit plus some reserve time, then you've got a little less than 14 years to go until you can get an immediate retirement check. You're right at the "fish or cut bait" point--after you sign up again you'll have too much invested to separate short of retirement. If you like what you are doing, like what you will be doing, and think you can hang with the program for 20, I'd urge you to stick it out. If this appears to be undoable, then you should make the decision soonest. Regarding the reserves/guard: This is normally a very good option for folks who separate, but you've got other issues since your OPTEMPO in the Reserves, in your MOS, might look an awful lot like an AD soldier.
__________________
"Freedom begins when you tell Mrs. Grundy to go fly a kite." - R. Heinlein
samclem is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 01:36 PM   #14
Thinks s/he gets paid by the post
Bimmerbill's Avatar
 
Join Date: Jan 2006
Posts: 1,631
Re: Military vs. Civilian

Yeah, there is not much to seperate active duty from reserve component anymore, as far as OPTEMPO is concerned. I'be been in the national guard for going on 22 years. There is a crazy deployment pace right now.

In fact, some of our tours are longer than the active duty. We do 12 month "boots in country" tours, which typically include 3 or 4 months before and after deployment, totalling 18 months.

Sometimes I wish I had done 22 years active duty. I'd be collecting now, instead of waiting 20 more years to receive retirement benefits...
__________________
Bimmerbill is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 01:39 PM   #15
Thinks s/he gets paid by the post
SteveR's Avatar
 
Join Date: Jul 2005
Posts: 2,803
Re: Military vs. Civilian

Quote:
Originally Posted by brewer12345
I doubt that's legal even in Utah.* Thailand, maybe?* *
Only if they are not your first cousins and they are all female. *

One difference between military and civilian is your chance of getting killed or maimed is much higher in the military even if only training. *Your toys tend to be a little more dangerous than ink pens and staplers. * I would certainly factor this in to any comparison you might make between the two. *Sure you can get killed or maimed in an industrial setting too but I would guess the military would be more dangerous even if not assigned in a war zone. *

It is pretty hard to spend your retirement when you are dead.
__________________
Work? I don't have time to work....I'm retired.
SteveR is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 01:58 PM   #16
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,620
Re: Military vs. Civilian

Quote:
Originally Posted by macdaddy
Psyop if you are proficient in Arabic and have security clearance from the military, I am sure you could retire and work for the Gov in a position at the CIA, NSA, or similar agency.* You would probably make more and you could roll your time served over into the civil service 20 year retirement track.* You would also have more flexibility to earn money from overtime and you could spend more time with your family.* Your risk of being blown up would decrease substantially.* After 20 years I hear you can retire and double your income by doing the exact same job in the exact same office with the exact same co-workers, working for a private defense contractor rather than the government directly.* Maybe this could be an option for you when you get tired of moving around.
Good point... one of our local police officers is also an Army Reserve sergeant.

Although today "Reserve" is perhaps a misnomer. He's spent the last three years in a Kunia bunker listening to various Abu Sayyaf innocent people in the PI ordering terrorist attacks lumpia in Ilocano & Tagalog on various cell phones communications systems.

His spouse is pretty happy that he's not patrolling H-1 looking for meth dealers.
__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 02:07 PM   #17
Recycles dryer sheets
 
Join Date: Jul 2006
Posts: 227
Re: Military vs. Civilian

Quote:
Originally Posted by macdaddy
Psyop if you are proficient in Arabic and have security clearance from the military, I am sure you could retire and work for the Gov in a position at the CIA, NSA, or similar agency. You would probably make more and you could roll your time served over into the civil service 20 year retirement track. You would also have more flexibility to earn money from overtime and you could spend more time with your family. Your risk of being blown up would decrease substantially. After 20 years I hear you can retire and double your income by doing the exact same job in the exact same office with the exact same co-workers, working for a private defense contractor rather than the government directly. Maybe this could be an option for you when you get tired of moving around.
I am working with a lot of contractors who do just that, the question is do I want to give all that time to the government?

I am trying to decide on going for a Masters, if I am to go my current route, it is International relations and married to the government.

If it is something else, MBA, CPA…I have options out?
__________________
"Those who think it cannot be done, need to stay out of the way of those of us doing it."
PsyopRanger is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 02:19 PM   #18
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
HFWR's Avatar
 
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 12,964
Re: Military vs. Civilian

Quote:
It is pretty hard to spend your retirement when you are dead.
Simplifies the SWR calculation, though.
__________________
Have Funds, Will Retire

...not doing anything of true substance...
HFWR is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 02:23 PM   #19
Full time employment: Posting here.
 
Join Date: Feb 2006
Posts: 784
Re: Military vs. Civilian

Will you be here all week?
__________________
Cool Dood is offline   Reply With Quote
Re: Military vs. Civilian
Old 07-05-2006, 04:09 PM   #20
 
Posts: n/a
Re: Military vs. Civilian

Quote:
Originally Posted by Enuff2Eat
Both are bad choices.

Over all, if i to do it again, both military and civilian are NOT my choice.

enuff
What's left? - Dead? (Self employed is civilian)
__________________
  Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Former Military Social Security credits - interesting Fireup2020 FIRE and Money 1 04-10-2007 10:24 PM
US Military Invades Pattaya... Lancelot Other topics 24 06-07-2006 09:49 PM
Military "benefits" Nords Young Dreamers 26 01-23-2006 08:19 AM
Military pay (ECI) vs military retiree pay (CPI) Nords Other topics 0 11-05-2005 11:51 AM
Natural Limits to Healthcare Expense Growth? haha FIRE and Money 84 06-11-2005 06:59 PM

 

 
All times are GMT -6. The time now is 10:02 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.