How to Plan Financially for Your Transition From Military to Civilian Life

Many people do not like to deal with finances. Families that have a member separating from the military must face those finances to transition successfully. A bit of planning will make the transition from military payroll to the civilian sector go smoothly. Read on to learn how to plan financially for your transition from military to civilian life.

Instructions

Difficulty: Moderately Easy

Things You’ll Need:

• Budget worksheets
• Calculator
• List of debts and savings

1. Start planning for your finances prior to leaving the military. You can’t deal with any problems that might come up if you do not know your current financial status.
2. Make a written budget of what your family spends now while in the military. Know how much you owe on debts such as car loans and credit cards. Be realistic about how much money you have in savings. Note how much you money you receive in housing and living entitlements.
3. Make an estimated budget for your life outside the military. Note that you will most likely now be paying different costs for housing and health insurance. You may also be paying more for car insurance and personal taxes.
4. Use the estimated budget to determine how much income you will need to live at the same standard of living that you currently maintain. This figure will help you determine if you should take a job offer or move to a certain part of the country.
5. Determine how much it will cost for you to move and which costs will likely be reimbursed by either the military or by the company which will employ you. If there is a large difference, start saving and exploring ways to finance your move.
6. Remember you can cash in your excess leave time. This can provide extra funds when it is needed most.
7. If your family still seems to be struggling, consider enlisting in the reserves or guard to supplement income.