Three Things to Start Saving for Before You Leave the Military

As you get closer to separation, having a plan for what’s ahead can make the transition a lot smoother. 

Here are three areas to start saving for before you leave the military.

1. Your Financial Transition After the Military

Moving after the military is different from a PCS. You’re often covering more of the costs yourself, and the timeline can feel less structured. 

Expenses can include: 

• Security deposits and rent
• Utility setup costs
• Moving expenses
• Temporary housing
• Transportation 

Beyond moving expenses, your overall financial picture also shifts once you leave the military. 

One area that often gets overlooked is how your taxes may change after leaving the military. 

While on active duty, certain benefits like your housing allowance and food allowance are not taxed. Once you separate, your full income becomes taxable. In some cases, you may also begin paying state taxes for the first time. 

That shift can affect your monthly budget more than you expected, especially during a time when other expenses are increasing.  

Starting early, even setting aside small amounts, can help you create a cushion for this transition.

2. Where You’ll Live After Service 

One of the biggest decisions you’ll make after leaving the military is where you’ll live, and whether you plan to rent or buy. 

As CMSgt (RET) John G. Evalle, Military Affairs Officer at Travis Credit Union, shared, many service members don’t purchase homes during their time in the military due to frequent moves and temporary duty stations. 

While that approach makes sense, it can also mean missing out on building equity over time. 

As you get closer to separation, saving for housing becomes more important. That might look like: 

• Building a fund for a security deposit or first month’s rent
• Saving for upfront homebuying costs
• Preparing for ongoing housing expenses in a new location 

If homeownership is part of your plan, the VA home loan benefit can be a powerful tool, but it still requires preparation. Closing costs, moving expenses, and ongoing maintenance are all part of the picture. 

Thinking ahead now can make your housing decision more flexible later.

3. Your Long-Term Savings and Retirement

When you’re focused on transition, it’s easy to put long-term savings on hold. But this is one area where starting early makes a real difference. 

Programs like the Thrift Savings Plan (TSP), now part of the Blended Retirement System, are designed to help you build long-term savings over time. With automatic contributions and matching after a certain period of service, even small amounts can grow significantly. 

Whether you serve for a few years or retire after a full career, the money you’ve already contributed continues to grow. Staying consistent with contributions even during transition can help you stay on track. 

A Note on Education and Income During Transition 

If you plan to attend school after leaving the military, benefits like the Post-9/11 GI Bill can help cover tuition and may provide a housing allowance while you’re enrolled. 

For many Veterans, this can help offset some of the financial pressure during the transition period and create more stability while building a new career path.  

Additional Support and Resources 

If you’re preparing to leave the military, you don’t have to do it alone. Veteran Saves offers tools and resources to help you take your next step with confidence. 

Free Financial Counseling- Through our partnership with the Foundation for Financial Planning, you may be able to connect with a financial professional at no cost. 

Take the Pledge 

Take the Veteran Saves Pledge to set a savings goal and get ongoing tips and support.