The average enlisted servicemember retires from military duty at 43, according to a May 2014 report from the Congressional Research Service, and the average officer retires at 45. Many of them re-enter the work force, but for some it’s not easy.
Unemployment for veterans fell to 5.3% in 2014, according to the Bureau of Labor Statistics, but for younger vets who have served at any time since September 2001, it was 7.2%. The National Alliance to End Homelessness found that in January 2014, there were almost 50,000 homeless veterans living in the United States, 8.6% of the homeless population.
Military pension benefits are only available to vets who serve a full 20 years. Servicemembers can also contribute to the Thrift Savings Plan, the defined contribution plan for federal employees, but they don’t receive a matching contribution from their employer.
“When most military servicemembers initially retire, they are young enough to start a second career,” Rod Powers, U.S. military expert for About.com, told WalletHub for its ranking of the best and worst states for military retirees. “Most people retiring from the military services after 20 years are not really able to live on military retirement pay; doing so depends upon many factors such as having a mortgage, credit card debt, a car loan and any other regular payments (such as child support or alimony). Not many people retire from the service debt-free.”
Amanda Weinstein, assistant professor of economics at the University of Akron, told WalletHub that veterans do best when they look for ways to “capitalize on their military skills and experience.”
“There are clear benefits in continuing their career in the military as a civilian and also in government jobs in general,” she said. “This also allows veterans to continue to serve their country in a different capacity. Veterans seem to earn higher wages compared to civilians in cities that are more likely to understand and appreciate the specific skill set veterans can bring to the table, specifically cities with a stronger military presence.”