Military Retirement and Next Career

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Topic Author
retirementbound
Posts: 24
Joined: Wed Oct 19, 2016 11:10 am

Military Retirement and Next Career

Post by retirementbound » Mon May 07, 2018 3:27 pm

You can see post history but will be retiring in September from the military with a pension of about $3900 a month.

I was contemplating taking some time off while my wife finishes her last year in the military before her retirement. I was informed that I will be starting what I would consider the dream retirement job. University professor starting at 110k for about 8.5 months of work. It is in an amazing field with great research potential. With retirement (state pension) taken out 403b, 457, and hsa I will bring home ~55k before taxes. Great for retirement and definitely helps the tax situation.

I am considering doing traditional for the 403b and 457 (37k) to reduce our taxes and possibly because we will not be eligible for Roth. I am not sure because of how our military pay is broken down between taxed and untaxed benefits. Pension is fully taxed but waiting on VA which could change the taxable portion of pension.

Any thoughts or advice on the financials would be appreciated. I sit down with HR this week and any questions to ask would be appreciated.

nanoanalyzer
Posts: 454
Joined: Sun Sep 28, 2014 4:14 pm

Re: Military Retirement and Next Career

Post by nanoanalyzer » Mon May 07, 2018 9:09 pm

Wait a second... A year from now, you're looking at two $4000+ monthly federal pensions, with COLA, with heath insurance continuation, GI bill covering the kids, and you want another job? Maybe I'm jaded from finishing my adjunct side gig today, which paid 25% for a ~40% time job, but that professor deal is almost definitely more work than the money is worth.

My advice: At the very least, back it down to an adjunct position to start. Take a load off. You deserve it, sir.

PS: Thank you.
"If you think stocks are like physics, you believe there must be smart people who can measure exactly where the Dow Jones Industrial Average will be in five months." -Morgan Housel

Topic Author
retirementbound
Posts: 24
Joined: Wed Oct 19, 2016 11:10 am

Re: Military Retirement and Next Career

Post by retirementbound » Mon May 07, 2018 10:15 pm

I certainly understand the sentiment and yes I know how fortunate we are. I was considering doing JROTC but I think this will be both rewarding from the teaching standpoint and the ability to keep learning.

I think I will find myself bored with the winter break and summers off but can always dial it back at that point. This program is relatively new so being able to help it grow is also appealing.

WanderingDoc
Posts: 1341
Joined: Sat Aug 05, 2017 8:21 pm

Re: Military Retirement and Next Career

Post by WanderingDoc » Mon May 07, 2018 10:36 pm

retirementbound wrote:
Mon May 07, 2018 10:15 pm
I certainly understand the sentiment and yes I know how fortunate we are. I was considering doing JROTC but I think this will be both rewarding from the teaching standpoint and the ability to keep learning.

I think I will find myself bored with the winter break and summers off but can always dial it back at that point. This program is relatively new so being able to help it grow is also appealing.
What kind of work were you doing in the military?
I'm not looking to get rich quick (stocks), I'm not looking to get rich slow (indexing), I'm looking to get rich, for sure (real estate) | Don't wait to buy real estate. Buy real estate.. and wait.

gotester2000
Posts: 620
Joined: Sun Nov 12, 2017 1:59 am

Re: Military Retirement and Next Career

Post by gotester2000 » Mon May 07, 2018 11:29 pm

EDIT - after seeing post history

A COLA pension and benefits - you dont need any financial plan as none can beat this.
You can be in taxable - 100% stock index.
Take the job,keep yourself busy while enjoying life.

Topic Author
retirementbound
Posts: 24
Joined: Wed Oct 19, 2016 11:10 am

Re: Military Retirement and Next Career

Post by retirementbound » Tue May 08, 2018 7:53 am

WanderingDoc wrote:
Mon May 07, 2018 10:36 pm
retirementbound wrote:
Mon May 07, 2018 10:15 pm
I certainly understand the sentiment and yes I know how fortunate we are. I was considering doing JROTC but I think this will be both rewarding from the teaching standpoint and the ability to keep learning.

I think I will find myself bored with the winter break and summers off but can always dial it back at that point. This program is relatively new so being able to help it grow is also appealing.
What kind of work were you doing in the military?
IT management.

Topic Author
retirementbound
Posts: 24
Joined: Wed Oct 19, 2016 11:10 am

Re: Military Retirement and Next Career

Post by retirementbound » Tue May 08, 2018 7:56 am

gotester2000 wrote:
Mon May 07, 2018 11:29 pm
EDIT - after seeing post history

A COLA pension and benefits - you dont need any financial plan as none can beat this.
You can be in taxable - 100% stock index.
Take the job,keep yourself busy while enjoying life.
I certainly will enjoy life. I think that this job provides the flexibility to do that.

The questions I was looking at was more from a tax standpoint. We can afford to max out the 403b and 457. Would there be any reason not to or us there a more efficient way of going about things.

ralph124cf
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Joined: Tue Apr 01, 2014 11:41 am

Re: Military Retirement and Next Career

Post by ralph124cf » Tue May 08, 2018 1:59 pm

Consider the mix of tax deferred versus ROTH money you want to have available when you retire. Also consider and plan for what you think will be the most probable tax law changes. The immediate rewards for putting money into tax deferred versus ROTH have been reduced this year compared to last year.

Ralph

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TierArtz
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Re: Military Retirement and Next Career

Post by TierArtz » Tue May 08, 2018 3:00 pm

I'm a military retiree and have a small slice of TSP and a 401K at a follow-on job. I want as much Roth IRA space as I can get to avoid MRDs and I want the Roth to be 100% stock for maximal growth potential (legacy option). After 10 years of figuring out where to place funds in various accounts, I finally settled on 100% G Fund in the TSP to take as much bond space as possible; max out backdoor Roths every year and hold only stock indexes in them; 100% stock index funds in a taxable account; Max out the tax deferred space too, and allocate as needed to hit the desired overall AA. Thanks to the last several years its 100% bonds too :-)

If you have a taxable account, you'll find that it is super easy to use MyPay/DFAS to tweak your withholding to cover estimated taxes.

Best wishes for figuring out what will work best for you!

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