As you progress through your career in the Military, you can see time as your worst enemy. Or, if you are wise and invest and save a portion of your money, time can become your best friend. There is no single subject where this is truer than retirement. Retirement is the biggest expense that most people will ever face during their lifetime. How big an expense retirement is depends on the kind of retirement that you want. The more income you have from other sources makes the amount you need less. Sources such as pensions and social security reduce the amount you are required to save to enjoy a good retirement.
But the word is: Reduce, not eliminate. If you rely solely on your pension and military retirement, you will not have the kind of retirement or the freedom in retirement that you might otherwise wish for. The magic of compound interest is a double-edged sword. If you start early, savings is pretty easy. The later you start the steeper is the climb to achieve even close to the same savings goals. That is why it is why it is very important to start savings as early as you can, the sooner you begin the easier it will be.
Use Savings Plans: As well as saving plans offered through the military, you can also open a savings account for retirement though a bank or lending institution. You can open an IRA, or individual retirement account. There are two types: Roth IRA, contributions are not deductible but some of the withdrawals are tax free under some situations. The other type is a Traditional IRA, this may be tax deductible, in most cases you’re earning that you deposit are completely tax-free.
Start Small: Many people paint their way into a corner because they feel that if they are not saving a lot of money at a time they are not accomplishing anything. Even twenty or fifty dollars a month is worth saving, and as you grow in income ability you can work to increase the amount you save. Automatic Savings: Arrange for a voluntary allotment or deduction from your Military pay, start with a small amount. After a while, you will not even miss it. Future pay increases you can split take half of the increase to your paycheck and put the other half into your automatic savings. By having savings automatic it takes the tendency to spend all your money and eliminates the negative effect. And you will really not miss the deduction after a while, you will adjust.
