Transitioning out of the military is a financial event as significant as buying a house. Most separation checklists focus on TAPS classes and resume writing, but the financial preparation is what determines whether your first year as a veteran is stable or stressful. Here's what to do and when.
12 Months Out
Calculate your target civilian salary. Use the Compensation Calculator to understand your true military compensation value, then set your civilian salary target accordingly. This number drives every other financial decision.
Start your VA disability claim research. Document every chronic condition. Start going to sick call for anything that bothers you — back pain, knee pain, tinnitus, sleep issues, mental health. These medical records are the foundation of your VA claim. Use the VA Rating Estimator to understand what your conditions might be worth.
Build your emergency fund. Target 6 months of civilian expenses. Use the Transition Timeline Calculator to figure out how much to save and your monthly savings target.
6 Months Out
File your VA disability claim (BDD). The Benefits Delivery at Discharge program accepts claims 180 days before separation. File now so your rating is processed before you leave. Every month you delay is a month of lost tax-free income.
Decide on TSP. You can leave your TSP in place (it keeps growing at the same low expense ratios), roll it to an IRA, or start withdrawals if you're retirement-eligible. For most separating members, leaving it in TSP is the right move.
Research health insurance options. You get 180 days of transitional TRICARE after separation. After that, options include employer coverage, VA healthcare (if eligible), marketplace plans, or TRICARE Reserve Select if you're joining the Guard/Reserve.
3 Months Out
Lock down a civilian job. If you don't have an offer yet, accelerate your search. Three months of unemployment at civilian expenses will burn through your savings faster than you expect.
Research state tax residency. If you're PCSing to a new state for your civilian job, consider whether changing residency to a no-tax state (TX, FL, WA, NV, etc.) before separation saves you money.
Update your budget. Build a civilian budget that includes health insurance ($500-$2,000/month for a family), increased grocery costs (no commissary), life insurance replacement ($50-$150/month for equivalent SGLI coverage), and full tax burden on all income.
Separation Month
Verify your VA claim status. Check eBenefits or VA.gov for your claim progress. If C&P exams aren't scheduled, call the VA immediately.
Enroll in transitional TRICARE. Don't let this lapse — you have 180 days of continued healthcare coverage. Enroll before your last day.
Get copies of everything. DD-214, medical records, service records, LES history. These are much harder to obtain after separation.
The Bottom Line
The financial preparation for separation takes 6-12 months, not 6-12 weeks. Start early, file your VA claim through BDD, build savings, and know your target civilian salary before you start interviewing. The tools on this site — Compensation Calculator, Transition Timeline, VA Rating Estimator — exist precisely for this process.
Ready to run your numbers?
Open the Compensation Calculator →