Retirement Savings To-Do Lists for Military Households

If I had a dollar for every time someone told me they’d “start saving for retirement later” or “we will get to it after …,” then I’d have, well, a much bigger retirement fund. The thing about retirement planning is that “later” has a sneaky way of turning into “too late.” But here’s the good news: No matter where you are on your financial journey, now is always a good time to start.

The key to a successful retirement isn’t just saving; it’s setting up guaranteed lifetime income so that your essential expenses are covered, no matter how long you live. Because let’s face it: You don’t want to spend your golden years hoping the stock market behaves or that your savings last longer than you do.

Step 1: Save Now Because Later Never Comes

If you’re in your 20s or 30s, congratulations! Time is your best friend. Thanks to the magic of compound returns, the earlier you start, the less heavy lifting you have to do.

But if you’re in your 40s, 50s or even 60s and you haven’t saved much? Don’t panic. The second-best time to start is right now. The key is to save aggressively, reduce unnecessary expenses and maximize every available savings vehicle.

Read Next: 7 Financial Fundamentals for Military Families

Your Retirement Savings To-Do List

Leverage military and civilian retirement plans. If you’re on active duty or a federal employee, take full advantage of the Thrift Savings Plan (TSP). If you’ve transitioned to the private sector, contribute as much as possible to a 401(k) or other available employer plan. In either case, consider an IRA to supplement what you’re investing for retirement at work.

Supercharge your savings with catch-up contributions. If you’re 50 or older, the IRS lets you contribute extra to retirement accounts. Pay attention to the IRS limits because they increase with inflation — and in some cases, with your age.

Don’t leave free money on the table. If your employer offers a matching contribution to your 401(k), get every penny of it.

Reduce debt and expenses. The less you owe, the more you can save. Simple math, powerful results.

Invest for growth, but with a plan. Stocks, bonds and other investments play a role in retirement savings. But don’t go overboard chasing risky returns. Stay diversified and maintain a portfolio that is aligned with your situation and preferences. One reason I’m a fan of “target retirement” options such as the TSP’s Lifecycle funds is that they do the heavy lifting when it comes to rebalancing and adjusting your portfolio as you age.

Step 2: Set Up Guaranteed Income to Cover Fixed Expenses

Saving for retirement is only half the battle. The other half? Making sure your essential expenses are covered with income that doesn’t run out.

That’s where guaranteed lifetime income comes in. You want to set up a retirement income plan where your core expenses — housing, utilities, food, health care — are covered by income sources that won’t dry up if the stock market takes a dive.

Your Guaranteed Income To-Do List

Maximize military retirement and pensions. If you have a military pension, congratulations! This is one of the best sources of guaranteed income. If you’re eligible for a federal or corporate pension, make sure you understand your payout options.

Get the most from Social Security. The longer you wait to claim Social Security (up to age 70), the higher your monthly benefit. Delaying could mean thousands of extra dollars per year in guaranteed income.

Consider income annuities. Think of an income annuity as a “DIY pension.” You use part of your retirement savings to buy an annuity, and it guarantees a steady paycheck for life. This can help cover any gaps between your fixed expenses and your other guaranteed income sources.

Plan for inflation. Inflation is a silent budget-killer. One of the most powerful features of military retirement and Social Security is that they are inflation-adjusted streams of income. Consider annuities with cost-of-living adjustments and plan for rising costs in your retirement budget.

Diversify for growth and stability. Not all of your retirement savings should go into guaranteed income streams. You still need investments for long-term growth to handle unexpected expenses and enjoy the fun side of retirement. If all goes well, your retirement could span multiple decades.

Retirement isn’t about hoping you have enough; it’s about planning so you know you do. Start saving now, no matter where you are in life. And when it’s time to retire, set up guaranteed income streams to cover your essentials so you can enjoy retirement without financial stress.

The best retirement plan is one that lets you sleep soundly at night — no market worries, no guessing games, just a steady paycheck for life. That’s how you truly retire with confidence.

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