What Veterans Should Know About Retirement Planning
Veterans' retirement benefits are among some of the most generous out there, in large part due to the risks and sacrifices that come from military service. But navigating this array of benefits may seem complicated. What should veterans know about their military retirement plans?
When are Veterans Eligible for Retirement?
Veterans who are injured in the service may be eligible for retirement benefits within five years of sustaining a disability. Others may be eligible after accruing 25 years of service or at age 50 after accruing 20 years of service. Other retirement eligibility dates may apply to those whose agencies are being reorganized, those who have been laid off through a reduction in force (RIF), or those who have transferred to a new employer. For veterans, there's rarely a one-size-fits-all answer to "when can I retire?" It's a good idea to talk through your retirement plans with an OPM employee to make sure you're on track.
Veteran Retirement Benefits
Some of the retirement benefits that are available to veterans include:
- A monthly pension
- Health insurance through Tricare
- Additional disability benefits for disabled veterans
These benefits are in addition to any other retirement benefits that a veteran may have accrued, like an individual retirement account (IRA), Health Savings Account (HSA), or other savings plans. The amount you may receive depends on factors like your length of service, your age at retirement, the amount you've contributed to your Thrift Savings Plan or other 401(k)-like plan, and your average earnings over your career. In general, the higher your regular pay, the greater your pension payment.
Preparing for Retirement
During the year or two before your retirement, it may make sense to prepare to make the retirement process as streamlined as possible. Some key steps include:
- Confirming your retirement eligibility
- Choosing a retirement date
- Getting information about your available retirement benefits
- Reviewing your official personnel folder (OPF) or equivalent folder to ensure that your records include all eligible service
- Choosing eligible beneficiaries (like a spouse or children)
- Checking your health benefits records
If there are errors or omissions in any of these records, it's important to correct them as quickly as possible. Otherwise, you may not be able to receive all the retirement benefits to which you're entitled.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.
All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.
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