Lessons Learned During App/Interview Process
05-10-2014, 11:57 AM
#41
Gets Weekends Off
Joined APC: Apr 2013
Posts: 3,445
Originally Posted by F15Cricket
E6B, I'm sure you've ran you numbers in detail, but I retired from the USAF 4 years ago (O-5 pilot), and my retirement with 22 years 1 month of service is closer to 1/3 of what I was making on AD. I know they advertise 50% at 20 years (my math is 55.2% of my base pay), but the things easily forgotten are:
- Tricare as a retiree will cost about $550 per year for the family (still an incredible price!)
- Retiree dental is about $160 per month for the family
- If you take SBP (I did), it comes out of your paycheck, too. Mine is about $260 a month.
- Life insurance: I took the VGLI when I retired; $400k coverage costs $1k per year
- Every penny you earn (military retirement, airline pay, etc.) is now taxed. This is one big gotcha, as you don't realize how big a deal all the "allowances" you were getting paid that weren't taxed. As an O-5, I paid almost nothing in taxes (I have 6 kids, so the child tax credit was HUGE!). As a retiree, I feel like Uncle Sam is having me make up for lost time in taxes, and as the kids get older, that tax credit gets less and less.
Currently, I have a job that pays well, and that plus my retirement is about the same I was making as an O-5 in gross pay. However, due to taxes and the increased expenses, my net is less than it was before.
All-in-all to say, the math I came up with prior to my retirement was my gross retired pay would be about 1/3 of my gross AD pay (with flight pay, housing allowance, COLA, etc.). Just want you to have the numbers from my experience.
- Tricare as a retiree will cost about $550 per year for the family (still an incredible price!)
- Retiree dental is about $160 per month for the family
- If you take SBP (I did), it comes out of your paycheck, too. Mine is about $260 a month.
- Life insurance: I took the VGLI when I retired; $400k coverage costs $1k per year
- Every penny you earn (military retirement, airline pay, etc.) is now taxed. This is one big gotcha, as you don't realize how big a deal all the "allowances" you were getting paid that weren't taxed. As an O-5, I paid almost nothing in taxes (I have 6 kids, so the child tax credit was HUGE!). As a retiree, I feel like Uncle Sam is having me make up for lost time in taxes, and as the kids get older, that tax credit gets less and less.
Currently, I have a job that pays well, and that plus my retirement is about the same I was making as an O-5 in gross pay. However, due to taxes and the increased expenses, my net is less than it was before.
All-in-all to say, the math I came up with prior to my retirement was my gross retired pay would be about 1/3 of my gross AD pay (with flight pay, housing allowance, COLA, etc.). Just want you to have the numbers from my experience.
My biggest advantage is my timing. I am going to work for all of my terminal leave and TAD. Due to the "carry 75" policy last year, I have about 120 days of double dipping that is going to net me the extra that I need for the first year of pay. That, plus my wife going back to work part time means we are not going to be pinched that bad.
I am ready to start cutting back here in order to survive. Believe me, there is a lot of cutting we can do. Once that second year pay kicks in, I think I am going to be doing pretty well.
05-10-2014, 12:10 PM
#42
Gets Weekends Off
Joined APC: Apr 2014
Position: Right Seat 737, Front seat T-6
Posts: 536
No worries. I was sort of surprised after I retired so any help I can provide to another retiring military member is the least I can do!
Double dipping is great -- great that you can start you new career on terminal leave, that's for sure!
This past winter, the contract I work for was under protest, so I was unemployed from 1 Oct - mid-Feb. Biggest lessons I learned during that time: there's lots of fat in my family's budget! Tightening the belt, we could live on my retirement plus unemployment (about $1900 per month) during that time. So, I think it was good prep for us as we transition this fall to the airline life.
Double dipping is great -- great that you can start you new career on terminal leave, that's for sure!
This past winter, the contract I work for was under protest, so I was unemployed from 1 Oct - mid-Feb. Biggest lessons I learned during that time: there's lots of fat in my family's budget! Tightening the belt, we could live on my retirement plus unemployment (about $1900 per month) during that time. So, I think it was good prep for us as we transition this fall to the airline life.
05-11-2014, 07:54 AM
#43
Gets Weekends Off
Joined APC: Apr 2013
Position: Retired AF/A320 FO
Posts: 326
Few thoughts to add. I am going on terminal leave in June. Found out in my ethics JAG outbrief that you can't technically start a new job on your 20 days permissive TDY so keep that in your crosscheck when doing the leave/TDY calculations. I am bumping my retirement up a month to deal with this.
If you are approaching age 45 and use term insurance and are in good health then lock in 30 year term insurance rates before your birthday. They normally don't go past age 75 and as a mobility pilot in good health and not flying general aviation I qualified for the best rates that will beat VGLI rates hands down. I ran a laundry list of products and did lifetime calculations if any one wants any info on the best pricing I found.
If you are approaching age 45 and use term insurance and are in good health then lock in 30 year term insurance rates before your birthday. They normally don't go past age 75 and as a mobility pilot in good health and not flying general aviation I qualified for the best rates that will beat VGLI rates hands down. I ran a laundry list of products and did lifetime calculations if any one wants any info on the best pricing I found.
05-11-2014, 08:21 AM
#44
Line Holder
Joined APC: Oct 2012
Position: Don't know what I don't know
Posts: 50
gr8vu,
Much appreciated. As a guy currently throwing darts at a calendar trying to find the right date to retire and facilitate a transition to the airlines, this is good info to include in the thought process.
Much appreciated. As a guy currently throwing darts at a calendar trying to find the right date to retire and facilitate a transition to the airlines, this is good info to include in the thought process.
05-11-2014, 08:36 AM
#45
Gets Weekends Off
Joined APC: Apr 2013
Posts: 3,445
Originally Posted by gr8vu
Few thoughts to add. I am going on terminal leave in June. Found out in my ethics JAG outbrief that you can't technically start a new job on your 20 days permissive TDY so keep that in your crosscheck when doing the leave/TDY calculations. I am bumping my retirement up a month to deal with this.
If you are approaching age 45 and use term insurance and are in good health then lock in 30 year term insurance rates before your birthday. They normally don't go past age 75 and as a mobility pilot in good health and not flying general aviation I qualified for the best rates that will beat VGLI rates hands down. I ran a laundry list of products and did lifetime calculations if any one wants any info on the best pricing I found.
If you are approaching age 45 and use term insurance and are in good health then lock in 30 year term insurance rates before your birthday. They normally don't go past age 75 and as a mobility pilot in good health and not flying general aviation I qualified for the best rates that will beat VGLI rates hands down. I ran a laundry list of products and did lifetime calculations if any one wants any info on the best pricing I found.
As far as the ethics brief, got it. Not to sound cavalier or like a rule violator, but if the govt is going to throw a fit about 20 days after 20 years of carrying the load (I have been away from the house for about half of that), I have a serious problem with that. Guys who are retiring (or even just getting out at their MSR for that matter) have pulled the sled long enough. They have earned those 20 days. I have yet to hear that one being enforced. 20 days can mean the difference between spending 25 continuous years flying the line or being furloughed and bouncing from job to job and never earning any seniority. I think anyone who delays a class date because a wet behind the ears jag told them they aren't supposed to be working is foolish and short sighted.
05-11-2014, 08:42 AM
#46
Gets Weekends Off
Joined APC: Sep 2013
Position: The one with a great view.
Posts: 241
Roger on all the above.....couple extras to add as well.
Retiring O-4, 22 years. Was planning to wait until 2015 to retire so we were just living with no worries and spending as described above. Plan was to start 12 months out on the serious savings.
Threw in my apps to the "Dream Job Major" in 2013 and figured I would wait it out, no rush. Out of no where "Dream Job Major" called, interviewed and hired! This was Nov 2013, told "plan for March class". So, I dropped my retirement letter and planned to use that banked leave for a 4 month double dip while enduring the first year pay. Sweet planned it perfect, I am a hero!
Ahhh but wait, had an awesome retirement week. My family and guys really took care of me from the fini-flight, ceremony and after party. Living Cloud-9. Monday after the ceremony found out there would be a slight delay in starting training....turned in to September and flexed a bit, now it will likely be July (this is good b/c terminal ends 30 Jun and retirement check starts end of July).
So ended up, my 4 months of "double dipping" did not work out the way I so perfectly planned. We cut way back on the home front spending, completed almost all the honey-dues, working out like an animal and applied to all kinds of jobs for Plan B,C,D etc..I also started in Aviation Consulting (that is a very slow start, until you get really well networked).
You know what they say about the best of battle plans....all the way up until the first shot is fired. Money wise, big picture - we are fine. Stress wise - I was not prepared for this kind of stressing on the unknown (see above, working out like an animal).
So here are the couple of extras.
1. Have well planned back up plans with back up plans to them.
2. Research heavily the SBP v. Life Insurance. Do not let anyone tell you one plan is better for you b/c it was better for them. The secret lies in your situation and that of your spouse and their age. Also look closely at the "Child Only Option". <45 and go Life Insurance route take a VERY hard look at Navy Mutual Aid's family plan.
3. Ethical v. Legal ....there is a difference. The Loyalty and Ethical we lived our lives by, well we are in the minority in the "real world". Especially the Loyalty! I am not saying leave your morals at the gate on the way out but, be well prepared - it is not the the same and non of that will pay your bills or feed your family....just sayin.
Keep in mind - I am still "living the dream" and I am NOT complaining. Heck with in the next 60 days I "should" be sitting in Denver going thru basic indoc.
Good luck in your journeys.
Retiring O-4, 22 years. Was planning to wait until 2015 to retire so we were just living with no worries and spending as described above. Plan was to start 12 months out on the serious savings.
Threw in my apps to the "Dream Job Major" in 2013 and figured I would wait it out, no rush. Out of no where "Dream Job Major" called, interviewed and hired! This was Nov 2013, told "plan for March class". So, I dropped my retirement letter and planned to use that banked leave for a 4 month double dip while enduring the first year pay. Sweet planned it perfect, I am a hero!
Ahhh but wait, had an awesome retirement week. My family and guys really took care of me from the fini-flight, ceremony and after party. Living Cloud-9. Monday after the ceremony found out there would be a slight delay in starting training....turned in to September and flexed a bit, now it will likely be July (this is good b/c terminal ends 30 Jun and retirement check starts end of July).
So ended up, my 4 months of "double dipping" did not work out the way I so perfectly planned. We cut way back on the home front spending, completed almost all the honey-dues, working out like an animal and applied to all kinds of jobs for Plan B,C,D etc..I also started in Aviation Consulting (that is a very slow start, until you get really well networked).
You know what they say about the best of battle plans....all the way up until the first shot is fired. Money wise, big picture - we are fine. Stress wise - I was not prepared for this kind of stressing on the unknown (see above, working out like an animal).
So here are the couple of extras.
1. Have well planned back up plans with back up plans to them.
2. Research heavily the SBP v. Life Insurance. Do not let anyone tell you one plan is better for you b/c it was better for them. The secret lies in your situation and that of your spouse and their age. Also look closely at the "Child Only Option". <45 and go Life Insurance route take a VERY hard look at Navy Mutual Aid's family plan.
3. Ethical v. Legal ....there is a difference. The Loyalty and Ethical we lived our lives by, well we are in the minority in the "real world". Especially the Loyalty! I am not saying leave your morals at the gate on the way out but, be well prepared - it is not the the same and non of that will pay your bills or feed your family....just sayin.
Keep in mind - I am still "living the dream" and I am NOT complaining. Heck with in the next 60 days I "should" be sitting in Denver going thru basic indoc.
Good luck in your journeys.
05-11-2014, 08:44 AM
#47
Gets Weekends Off
Joined APC: Mar 2008
Position: FAA 'Flight Check'
Posts: 13,837
That ethics rule isn't just for a pilot like you E6 and there are plenty of situations where others should not be double dipping not only for the supposed ethical reasons but for legal reasons and the number of days do matter. Ethics are a tough beast. You do what you think is right, but your logic might not apply to all.
05-11-2014, 08:58 AM
#48
Gets Weekends Off
Joined APC: Apr 2013
Posts: 3,445
Originally Posted by USMCFLYR
That ethics rule isn't just for a pilot like you E6 and there are plenty of situations where others should not be double dipping not only for the supposed ethical reasons but for legal reasons and the number of days do matter. Ethics are a tough beast. You do what you think is right, but your logic might not apply to all.
05-11-2014, 09:00 AM
#49
Gets Weekends Off
Joined APC: Apr 2013
Posts: 3,445
As an aside, this thread is a great source of info and has really shed a lot of light on issues that I am not thinking about. Keep it coming. I am literally the ONLY retiring officer in my squadron. I am on an island when it comes to benefits and transition. Thanks to all who are contributing.
05-11-2014, 09:06 AM
#50
Gets Weekends Off
Joined APC: Apr 2013
Posts: 3,445
Originally Posted by MPAdriver
Roger on all the above.....couple extras to add as well.
Retiring O-4, 22 years. Was planning to wait until 2015 to retire so we were just living with no worries and spending as described above. Plan was to start 12 months out on the serious savings.
Threw in my apps to the "Dream Job Major" in 2013 and figured I would wait it out, no rush. Out of no where "Dream Job Major" called, interviewed and hired! This was Nov 2013, told "plan for March class". So, I dropped my retirement letter and planned to use that banked leave for a 4 month double dip while enduring the first year pay. Sweet planned it perfect, I am a hero!
Ahhh but wait, had an awesome retirement week. My family and guys really took care of me from the fini-flight, ceremony and after party. Living Cloud-9. Monday after the ceremony found out there would be a slight delay in starting training....turned in to September and flexed a bit, now it will likely be July (this is good b/c terminal ends 30 Jun and retirement check starts end of July).
So ended up, my 4 months of "double dipping" did not work out the way I so perfectly planned. We cut way back on the home front spending, completed almost all the honey-dues, working out like an animal and applied to all kinds of jobs for Plan B,C,D etc..I also started in Aviation Consulting (that is a very slow start, until you get really well networked).
You know what they say about the best of battle plans....all the way up until the first shot is fired. Money wise, big picture - we are fine. Stress wise - I was not prepared for this kind of stressing on the unknown (see above, working out like an animal).
So here are the couple of extras.
1. Have well planned back up plans with back up plans to them.
2. Research heavily the SBP v. Life Insurance. Do not let anyone tell you one plan is better for you b/c it was better for them. The secret lies in your situation and that of your spouse and their age. Also look closely at the "Child Only Option". <45 and go Life Insurance route take a VERY hard look at Navy Mutual Aid's family plan.
3. Ethical v. Legal ....there is a difference. The Loyalty and Ethical we lived our lives by, well we are in the minority in the "real world". Especially the Loyalty! I am not saying leave your morals at the gate on the way out but, be well prepared - it is not the the same and non of that will pay your bills or feed your family....just sayin.
Keep in mind - I am still "living the dream" and I am NOT complaining. Heck with in the next 60 days I "should" be sitting in Denver going thru basic indoc.
Good luck in your journeys.
Retiring O-4, 22 years. Was planning to wait until 2015 to retire so we were just living with no worries and spending as described above. Plan was to start 12 months out on the serious savings.
Threw in my apps to the "Dream Job Major" in 2013 and figured I would wait it out, no rush. Out of no where "Dream Job Major" called, interviewed and hired! This was Nov 2013, told "plan for March class". So, I dropped my retirement letter and planned to use that banked leave for a 4 month double dip while enduring the first year pay. Sweet planned it perfect, I am a hero!
Ahhh but wait, had an awesome retirement week. My family and guys really took care of me from the fini-flight, ceremony and after party. Living Cloud-9. Monday after the ceremony found out there would be a slight delay in starting training....turned in to September and flexed a bit, now it will likely be July (this is good b/c terminal ends 30 Jun and retirement check starts end of July).
So ended up, my 4 months of "double dipping" did not work out the way I so perfectly planned. We cut way back on the home front spending, completed almost all the honey-dues, working out like an animal and applied to all kinds of jobs for Plan B,C,D etc..I also started in Aviation Consulting (that is a very slow start, until you get really well networked).
You know what they say about the best of battle plans....all the way up until the first shot is fired. Money wise, big picture - we are fine. Stress wise - I was not prepared for this kind of stressing on the unknown (see above, working out like an animal).
So here are the couple of extras.
1. Have well planned back up plans with back up plans to them.
2. Research heavily the SBP v. Life Insurance. Do not let anyone tell you one plan is better for you b/c it was better for them. The secret lies in your situation and that of your spouse and their age. Also look closely at the "Child Only Option". <45 and go Life Insurance route take a VERY hard look at Navy Mutual Aid's family plan.
3. Ethical v. Legal ....there is a difference. The Loyalty and Ethical we lived our lives by, well we are in the minority in the "real world". Especially the Loyalty! I am not saying leave your morals at the gate on the way out but, be well prepared - it is not the the same and non of that will pay your bills or feed your family....just sayin.
Keep in mind - I am still "living the dream" and I am NOT complaining. Heck with in the next 60 days I "should" be sitting in Denver going thru basic indoc.
Good luck in your journeys.
With regard to life insurance vs SBP, did you talk to a financial planner, or just run the numbers yourself? This is a big question mark for me and with a wife with limited career options due to moving around and raising kids, I need to figure out how much is enough to take care of everyone. I think I am going to call NMAA and see what my options are. I have carried a light term policy with them since I was commissioned to offset sgli.
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