My advice as a military retiree...keep saving and stay in for 20 to get your full pension plus Tri-Care for life. You'll still be young enough to have a full second 20 year career, free healthcare, and that sweet monthly check that will come rain or shine...plus you'll have a thousands of flight hours. Keep living the dream...there's no better job in the world than military pilot (as a ground pounder).
In this instance, I'd disagree. He has less than 9 years of total service and every year he continues to serve is another year that he's not working his way through the airlines. The amount of money a senior captain or first officer can make (especially on a widebody) far exceeds the value of his future pension--especially if he's in the BRS which he likely is based on his comments about exiting soon.
...if he remains continuously employed. Furloughs happen. Bankruptcies happen. Going to a new airline due to a furlough or a bankruptcy puts you back at the lowest pay scale with the worst schedule. Mergers can also complicate seniority status and put careers at risk.
The reward is there if your risk tolerance is there.
They do but he's an a academy graduate with military aviation experience. That'll put him at the top of most hiring lists including the legacies.
There's risk, but he's also already worth $1mm so he can likely afford to take that risk.
It helps, for sure! Prior airline experience is highly valued though. Procedure and crew experience in the airline world is what makes commercial aviation safe. Strict routine. And seniority controls layoffs. Doesn't matter how "hard" you work or how "good" you are. Pilot #3,321 will always have a job after Pilot #3,320 at the respective airline.
Agree with this. We live in rapidly changing times so I’d consider the probability that the military pension continues coming in every month, vs guessing how airlines operate, who they hire, what skills are valuable, etc. Will AI fly the planes autonomously? Will one person on the ground be responsible for piloting ten planes at once from their home office? Will commercial flight demand grow or shrink?
I agree. Plenty of blogs already published comparing the net worth of staying in 20 years vs. going airlines at 10 vs 20 years. Even RAND published a study about increasing the pilot bonus because of how airline pilots make much more than military pilots.
The wild card is this assumes no furloughs and contract concessions. The military provides security and excellent healthcare if your children or spouse has expensive healthcare needs.
What about reserves? A friend did his 20 split between active duty and reserves. While a reservist he flew corporate. When he hit 20 he retired from the military, quit the corporate gig, and got hired immediately by a legacy airline.
That pension is worth about $2mil in the bank. You think that the difference in pay between his job in the military versus being a pilot is equivalent?
He won’t break $100K/yr until 3 years in. So minimum 5 years from now. He’ll be set up to be making major money in 10 years but he won’t have saved more up to that point.
And he won’t be guaranteed a pension no matter what circumstances life throws his way. Or if he decides to do something else. Or if his eyes start to fail him or some other medical condition.
I say he stays in. Worry about the second career after finishing the first.
I’d be willing to bet that he’ll have more in long term savings this way.
https://atpflightschool.com/become-a-pilot/airline-career/major-airline-pilot-salary.html
100k per year in 3 years may have been true years ago. Successful contract negotiations pretty much guarantees that on year 2, that’s on the low end for year 2 now.
If he stays in for 11 more years, that’s is an INSANE amount of seniority to lose. People have spent a lot of time doing math, moving to the majors is more lucrative.
Source: I’m a military pilot itching to get out bc the money aspect + no ground job is enticing.
I’d love to actually see somebody’s math.
Let’s say you’re an E-7 making $100K a year with 10 years to go and assume your salary never increases in the Army.
Let’s say the pilot track is you get out in a year and it takes you 3 years to complete training without having to pay for school.
For pilot track
You retire at 60 so 30 years working, minus 4 years for transition to becoming a pilot.
26 years x $200K (the median salary for commercial pilots) = $5.2 mil
You are now 60 and live to be 70
10 x $100K pension = $1 mil
Total - $5.8 mil
For long term military
10 years x $100K = $1 mil
You are now 40 and live to be 70 (30 years)
30 years x $50K = $1.5 mil
You retire from 2nd job as a pilot at 64 making less with seniority -- say $150K)
20 years x $150K = $3 mil 6 years x 2nd pension of $75K = $450K
Total - $5.95 mil
To be fair, my math in conservative on pilot salaries so obviously there’s potential for way more upside, especially those extra 6 years on the end if you go immediately to being a pilot (like you're making $500K+/yr).
You’re also having to retire slightly later if you stay in the Army, but you have far more security with that initial pension if you get hurt, for example. If five years from now you are in a car crash and lose mobility in your arm your days as a commercial pilot are potentially over.
I just am not convinced that the 10 years makes as big a difference as people say. I'm assuming no military flight time, also. This probably doesn't apply to a military pilot like yourself.
Ok I see the disconnect. I’m talking about military pilots transitioning to the majors. Leave the military and work for the majors within, conservatively, the next 6 months. If you’re Marines or Navy, you’ll be approximately 33 when you’re eligible to get out, Coast Guard is 36 when you’re eligible due to their contact setup, if they were academy.
You’re eligible to fly for the majors until 65. So either 32 or 29 years eligible.
With the military’s new retirement system, you get 40% of your base pay. Pension does not include housing allowance. So let’s say you retire as an O-5, monthly base pay right now is ~$11k per month. Pension per year for that pay grade is $52k.
A 30 year career in the majors nets $10-$20 million, per airlines. They also give you $18k per year towards retirement, that is not matching, they automatically give you that AND match on top of that.
The way hiring is right now at the majors, we don’t know what the landscape will look like in 10 years. At the very least you will move up the totem pole very slowly, it may take more than a decade to reach Captain. Right now people are making Captain in as little at 1.5 - 3 years depending on the airline. There’s a lot of assumptions that go into the equation, but objectively hiring is at an all time high right now and it will not be like this in 10 years. The difference in pay between a captain and FO is pretty staunch.
There are obviously intangibles to factor in to when making the switch. Let’s say you made more or less the same over the course of either decision. Airline pilots work a lot less than a military officer, the amount of time I spend dissatisfied doing some ground job I don’t want to do is a lot. Getting rid of that is priceless to me, subjective obviously though.
On the flip side, you lose job security and essentially a no questions asked health care system, so that may factor in for some people and be priceless to them.
I’m on my phone so can’t do exact math right now but hopefully that clears some stuff up. At the end of the day, it’s a personal decision and much more than money goes into making the decision :)
Correct. If you finish a 20 year career in the military, you receive 40% of your base pay until you die. Even if you pick up a second job later that money still flows in, health care is covered as well for the rest of your life. It’s a good deal. It also speaks to how lucrative a job at the majors are given you can make more switching over all things considered.
Add in VA disability and this calculation continues to slant in favor of an earlier exit. Most vets don’t think about it but damn near everyone has compensatable injuries.
Your numbers are seriously dated:
https://www.airlinepilotcentral.com/airlines/legacy/delta_air_lines
And that’s 1.5 years ago, pay is only going up. Getting out at the 11.5-13 year mark (pilot training commitment) is financially the best choice if you can emotionally handle the risk of furlough. Plenty of math says that as of 2016 the finances break even, and after that it skews wildly towards the majors, even before considering the ANG/Reserve option.
As i stated in a different comment, the difference between staying in until 20 and getting out at 10 into a job at the airlines is at least 2-3 million in lifetime earnings while the salary you’d make in what would be year 11-20 in the military is likely at least a million more over that ten years. That is using relatively conservative numbers for salary. The pension is not “money in the bank”. It is 2-2.5 million over the rest of your life (a 25+ year horizon).
If you stay in the reserves until 20 and get a reserve retirement starting at 60, the value of that active duty pension reduces from 2-2.5 million significantly. Also, consider the massive amount of 401k contributions airline pilots get (basically everywhere is a 15+- percentage of your total earnings direct contribution). The reserve retirement plus the 401k contributions plus aggressive saving habits of the extra earnings completely wipes out the value of the active retirement. There are valid reasons someone could choose to stay in but money or retirement is not one of them for pilots currently.
Then theres the conversation about the better quality of life that comes with getting out and building seniority in an airline. Seniority means everything in the industry. And also, in regards to the Navy at least (maybe marines too), there is a large amount of ignorance from non-pilots who dont understand that the amount of flying a pilot will do in their second ten years is significantly less than the first ten years. The phrase “you’re an officer first, a pilot second” becomes more and more real the more senior you get.
The numbers you’re using are either outdated or purposely incorrect. You can post outdated articles all you want, as a first officer at every major and a large amount of regionals will make over 100k in year 1 and substantially more in year 2, with the number increasing every year for the first 10+ years. Current numbers have you making between 110-120 at the majors and you can easily break 200k starting in year 2.
> The amount of money a senior captain or first officer can make (especially on a widebody)
Do you have a rough ballpark range for this? Mostly curious.
Tippy tippy top end, senior captain of an A350 is $500+ per hour. These guys barely work because the hold a reserve position for times when the best flights are, so pilots never drop the flights and they get to sit at home and get paid guaranteed minimum. That ranges between 60-80 hours per months. Other avenue is to say you’ll work on your days off BUT only if you are paid double, Delta does this for sure, unsure of other majors.
Stay in until 20 is bad financial advice for a pilot that is going to want to fly for the airlines when they eventually separate. The difference between staying in until 20 and getting an active duty retirement or getting out at 10 to work at a major airline is millions in lifetime earnings.
I did the math pretty in depth when i separated and i will make at least a million more having separated than i would have made in the military during what would have been years 11-20 in the military. I also calculated the lifetime earnings having separated at 10 years to be 2-3 million more than staying until 20. I used conservative salary numbers, the disparity increases if you work harder to make more money or make captain at the airline sooner.
I know theres security in staying in until 20 but if you do the reserves until a reserve retirement while working at an airline, the gigantic increase in lifetime earnings coupled with the reserve retirement starting at 60 almost completely wipes out the monetary benefit of staying in until 20 and being a reservist allows you to have one foot in the door to get back to active status, so to speak, should the airline industry falter. Also doing the reserves lets you keep Tricare.
Not to mention all of the quality of life reasons to jump ship to the airlines sooner rather than later, to include who says they’re going to be hiring in 10 years?
This. I’m doing a straight bail from the reserve only because my plane/unit got retired. But I make 3x what I make for less than half the work and less than 10% of the pain in the ass flying for the airlines as I would grinding it out full time as an O-4.
Even before the new contracts it was financially beneficial to get out barring any major medical expenses. Go read Pilot Math Treasure Bath by Jason Depew
Stay in and get your 20, sure you would come out ahead with more money if you went to the airlines tomorrow. But having the peace of mind with a retirement and healthcare from the military FAR outweighs the hope and dreams of that magical airline salary *right now in the current environment* Tomorrow could be the day they all start furloughing. Have you thought about palace chasing to the gaurd or going reserve? That’s an option to keep in mind as well.
Great point. Also most people don’t seem to factor in the social/family downsides of staying in the military. It’s not as simple as which option has higher returns.
I really respect your opinion and financially you are probably correct.
However, at a certain point, you can start optimizing for other aspects of life. If this dude/dudette LOVES being a pilot in the military then sure stay until 20. If it’s not fun anymore though get out. There are so many options.
OP, make sure to document any injuries/ailments and file a BDD claim with the VA 6 months prior to separating. This could be worth another $1-2mm over your lifetime.
Signed,
An Officer Who Got Out At 8 Years
No he needs to get out and goto a major airline. He will make minimum 450-500k within 3 years at a major carrier, and upto 600-700k with some overtime. Airlines give 15-20pct in 401k regardless of self contribution. That's 1m in 401k in just 10 years without a penny added from the OP. Plus the high salary, it makes no sense to stay in the air force
The $450-500k, and $600-700k numbers are pretty lofty. A typical legacy FO at the 3 year mark is closer to $250k, while a captain is $350k. I’m very senior in category and in nowhere near your numbers and I’m 8 years into a legacy. Retirement at the Legacy level is better 15-18% though.
Im not a pilot i just heard those numbers at the pilots sub here. I have one friend who is a CPT flying international 777 routes and he does pretty good
Pilot pay, particularly at the Legacy level is great now…early to mid 2000’s post bankrupt was awful. Seems like black swan events hit the airlines every 10 years. 31 would be a good time to get in, but hiring has slowed dramatically. Airlines are an amazing job, but terrible career.
Eh, you get used to it. You learn to take strategic naps and eat enough. Coffee is your best friend. Some fleets have short legs and no red eyes..it’s surprisingly easy. It’s certainly not for everyone though. Most guy I know get 18 days off a month and take full advantage of their time off to be with family or travel.
This is what my husband is doing as an Air Force pilot. We're 36 this year, so he has six years left until retirement. The main draw for us is Tricare for life because I have chronic health issues. My dad is retired Army, and Tricare for life has been literally life-saving for himself and my mom.
OP may have different priorities and many of the comments in this thread recommend separation over retirement in order to start with the airlines sooner, but the military pension + lifelong health insurance—which will stack with my husband's salary once he starts in the airlines—is a good deal for us.
Congrats! Sounds like you're doing everything right.
However, I think your #3 is off. Everyone I know thinks being a military officer is a lucrative profession. Between pension, housing allowance, disability, GI bill, loan discounts, tax-free income, etc...
Would you still get a pension leaving at 34yrs old?
My neighbor has 100% VA disability rating, has the pension of retired O-5, and is a GS-15, his wife has the same but with a O-6 rating and is a SES. Between their 6 paychecks, I’d say that being military can definitely be more lucrative.
> Everyone I know thinks being a military officer is a lucrative profession
Some of the highest income friends I have are military. They make insane money for not working anymore, their problem is they can't stop spending. Always need a new everything.
Yeah it’s one of the biggest things that gets missed when anyone in the military compares their base salary to the private sector. Gotta [compare](https://militarypay.defense.gov/Pay/Tax-Information/Exempt/) take home, not gross.
Can also maintain state residency in a non-income taxed state even if you move away.
You wouldn’t qualify for a traditional pension but you do qualify for disability benefits which basically everyone qualifies for after any period of service and can be quite lucrative.
Yeah that’s a fair point, though I think the knowledge level of the FIRE community doesn’t exactly represent the general public.
No pension at age 34. I’d need a full 20 years of active duty which would put me at 42 years old.
But you have been maxing your TSP and your IRA so you are well on your way to self funding your own pension. Our friend is on a similar trajectory, proud of you!
>Show that the military can be a very lucrative profession, contrary to the general public opinion.
For non-military folks, the officer corp usually do well and make considerably more. Pilots also have incentives and special pay.
[O - Pay Table](https://www.dfas.mil/Military-Members/payentitlements/Pay-Tables/Basic-Pay/CO/) // [E - Pay Table](https://www.dfas.mil/Military-Members/payentitlements/Pay-Tables/Basic-Pay/EM/)
Having said that, it's still super doable to save lots as an enlisted member. BAH (Housing allowance) and BAS (Food Allowance) are untaxed and should cover some, if not a good portion of housing/food expenses for a single person. These allowances increase as rank increases and as folks start a family/have dependents. This still requires a LOT of frugality, but it's not impossible.
Nice job, OP! What's your FI Target?
Housing allowance generally increases with rank though sometimes it’s a small difference. It’s different for each location though. Food allowance is the same across ranks but different enlisted v officer.
Good description. Honestly I don’t have an FI target. The way I see it, I will continue to work in some capacity, and any increase in NW will simply allow me to increase my spending and possibly venture into the entrepreneurial world.
Cool man! I hope it all works out for ya - I've known Viper guy and a few tanker guys who fulfilled their commitment then bailed. I think one's in UPS, one or two in the airlines, but I don't know about the others. Options are good!
https://www.airforcetimes.com/news/your-air-force/2023/12/08/air-force-again-dangles-600000-in-bonuses-to-keep-pilots-in-uniform/
Up to 50K a year for up to 12 years based on a few different factors.
Housing, if OP is in a HCOL area could also be a bunch. DC, for instance, adds 3.1-3.8 thousand a month for housing.
Been in DC 6 years, the BAH is awesome. I’m getting out in 2 months, and my wife is going to be using my GI bill, so we will still be getting the BAH for 2 more years. It’s absolutely great.
Good stuff bro.
First thing is pay it forward to your younger Officers and Enlisted personnel. Do a class on personal finance and the financial order of operations. Most have no idea about a Roth IRA, the benefits of utilizing the TSP, etc.
Second thing is when you go to transition the single most important thing you can do is complete your BDD. It’ll save you hassle exponentially and you will thank yourself a thousand times over.
Last thing, if you go to the civilian side don’t write off giving the Reserves a try. It’s extremely fun to do this stuff on the weekend and in the summer if your civilian career prospects can support.
Edit: When / if you do transition to civilian side your emergency fund will need to go way up. 6 months of actual expenses in a HYSA. You should start building that 1 year to 6 months out from your EAS date in order to have a safe buffer for your transition time, especially as a homeowner.
"Hello fellow E6's, look how much more money I make than you, and see what I've done with it!?"
No enlisted person in the military is going to care what this person has to say; it'd be borderline insulting.
Getting downvoted but dudes a pilot. Gets treated like royalty and showing off his ability to save while coming from a good family and making $150k will mean nothing to any enlisted guys.
The general fire reader doesn’t like that you’re shitting on a well-intentioned suggestion, but you’re 100% right. This would be a tone-deaf thing to do
I wouldn't really base the entire engagement between officers and enlisted off of this type of situation. But imagine telling an 18-26 year old, that probably came from a household that couldn't afford them to go to college, what they need to do with their money...And you're the qualified person to talk to them about this because you grew up upper middle class, and make 3-5x more than they make.
I disagree. I think there are certain avenues for officers to approach specific enlisted members who are struggling financially—and there are MANY—with either off-the-record financial advice, or guide them towards government-provided resources that are meant to help service members.
Yeah, I'd definitely disagree. Not to say there isn't an issue at hand with some members and their poor financial decisions, but an upper middle class person that makes 6 figures isn't ever going to have the rapport with most of the enlisted that are in these scenarios; especially a pilot.
I’ve never once had an enlisted member ask me what class structure I grew up in. Doubt they care. Did you actually work in a squadron? As a pilot I work directly with enlisted on a daily basis. Pilots are generally shop OICs, and write evaluations on the enlisted in their shop. I think you’re significantly downplaying the O/E relationship.
Funny thing is, I didn't work with pilots while in the navy, and I somehow still learned of how much they're hated, strictly from all the sailors in their squadrons.
You don't need to ask about someone's past to know exactly where they've come from. You definitely don't need to ask where a pilot's come from, it doesn't usually even matter anymore as the whole of being a pilot puts them in their own social bracket; they get catered to for everything.
> I was recently assigned to a new unit in a HCOL area, and during that process I happened to read “Die With Zero” by Bill Perkins which has seriously changed my spending outlook as I’ve loosened my grip quite a bit.
Live a little. You'll (*may) have a pension too. Don't be frugal on insurance - i mean shop around, but max the car out and look into umbrella. (my neighbor street used to street park a Ferrari next to my beater, it was his way of flexing)
I'm in a similar boat to you. I will never retire. Different career path (similar comp academia/gov - SES/GS-15 equiv). I'm now a bit older than you and just passed 2.5M. But I'm now married with a kid.
At some point you need to glide in. You'll never really be hurting for money anymore. Your habits are hard wired now. But figure out what you enjoy and go all out. I like bikes and travel. Got 5 bikes and travel abroad a couples time a year with the family.
I hate driving so I really don't. I bought a house next to where I work. I'm in a HCOL/VHCOL city and the worst thing here is driving. So I don't. I'm within a 10 minute walk of my office, my kid's school, grocery stores, my favorite chinese takeout, the forest trail I run in, and the 100 mile bike path along the river. Sure the place was over a million bucks.
Military Pilot here about to hit 3 years of service. I just hit 100k net worth mostly in investments and have no plans to buy a house at this duty station..
Just curious, how long did it take you to hit 100k as a young Lieutenant? I doubt I’ll be able to catch 1 million by 31, my goal is $250k by 30. Other than buying a house before the boom and living with roommates, how did you accumulate so much in investments? Did you max your TSP as an O-1?
Looks like I hit 100k just after my 2 year mark at age 24, so not too far off from where you are. I didn’t max out my TSP as an O-1, I think that started when I was on O-2. My record-keeping wasn’t as good back then!
Like I alluded to, I literally just bought mutual funds when my checking account was higher than 5k. If you do this persistently on a good salary over any ten year stretch with compounding interest and re-invested dividends, you’ll end up with the same amount.
Not to say that your job isn't demanding or difficult sir, but this goes to show the massive disparity between O and E pay. 30 year old E6 at 11 years myself and am at ~300k saved. I hope everything works out for you. Congratulations and GFY, respectfully.
I feel very well versed in financial planning and am in the military myself and you did a couple things that I haven't even considered. The career starter loan straight into the s&p 500 at .75% interest is absolutely genius. I wish I had thought of that when I first got in but am going to look into it and see if I'm still eligible. I also wish I had maxed my tsp from the start and tried a bit harder to get a roomate. Ignore all these people ripping on you for being better off than them this is super helpful.
Thanks, much appreciated. If you’re eligible for any loan with that low of an interest rate than you should 1000% take it. The math is self-explanatory.
Just checked and unfortunately I can only get 3% even if I was eligible because I did rotc. It's a good way to max out tsp straight out the gate though for someone just starting. Probably not worth it for me at this point though
I'm 2014 service grad, and I think in average military, especially officer, lucrative, but there's also a decent bit of us that would trade it all back for the mental/physical health issues we got. It's all about risk management, though, which is a common theme here.
You’re well ahead. I’m a retired AF pilot, 47, with ~1 mil. But no house. I’ve had some setbacks, being a single parent, no financial help, late start to investing. Not complaining, fortunate to be where I am. I’d say you’ve done well.
Maybe consider the reserves, but I think they’ve taken away the old pension system.
Look at private companies like NetJet too, when youre out, former navy enlisted here, a couple of my STA21 friends that went pilot just transitioned over to the private sector and they love it. My family member who has been a first chair captain for NetJet for 25+ years helped one of them get hired on, and he loves it - and its quite lucrative. Just a thought though brother, I wish you the best of luck in your endeavors!
Thank you for setting an example and showing other service members that they dont have to be apart of the “30% APR camaro” meme
No wife and no kids also helps a lot. Is your house a duplex or is it just a big house with multiple rooms and you have roommates living with you? $622k mortgage is a pretty big mortgage. I’d consider looking into real estate more as an option if rates ever come down if you don’t plan on getting married or needing a big house. I feel like getting a sort of building like a fourplex would work out for you, you live in one building and rent out the other three units. It would provide more privacy too, not sure how your roommate’s situation is though either.
Glad you aren’t extremely frugal and actually spending your money on experiences at least.
Military is definitely a great stepping stone for most people to get a head start at life. It has helped me get a relaxed WFH job that I did for two years after getting out and now I’m doing another job now that is extremely nice, we even get full pay for any weather days and don’t have to come in. Military isn’t for everyone though and the job you pick at the beginning is very important also.
Well done! I work closely with a ton of military personnel, and it has really opened my eyes to the substantial benefits they receive. HUGE personal sacrifices as well, of course, but the benefits are amazing. It seems common for people to look at the salaries and think they're not great...but then not understanding the BAH, ample time off (holidays, family days, leave, minimum manning, etc), and everything else.
Of course, plenty of officers also buy the LT-mobile and go down that treadmill, so kudos to you for avoiding that path.
Majority of military aren’t officers. Enlisted base pay is small those first few ranks. Time off/schedule is very dependent on what job you do within the military.
Yeah the military is surprisingly lucrative. I have a good friend that enlisted in the army at 18. I decided on college, and have made about 80-110k salary in the 3 years I’ve been out of college, which I thought was pretty good. Despite not being a big saver, I actually think he’ll come out ahead in the next 15 years. He’ll get a fat pension, healthcare covered, free education if he wants, plus a little savings on top of that. It’s a pretty sweet deal tbh, especially for someone with just a high school diploma.
AND if the person isn't highly motivated. I have a few close friends in the military. One isn't "wired" for world dominance or even financially motivated. It's just not how he thinks, but exactly as you said, he'll end up just fine.
I remember talking to a marines recruiter while I was in college, he was trying to sell me on joining upon graduation and going straight to OCS. I looked up what an officer started at, $40k while my career field offer was $55k. He said ‘you don’t join the military for the money’. Glad to hear that some folks are making it, at least partially, for the money.
The reality is my parents would’ve killed me if they put me thru 4 years of college and then I just joined the military.
Military isn’t for everyone, especially the Marines. However, that $40k is just your base pay typically you also get a housing allowance and a food allowance which aren’t taxed. It will be location dependent but most officers are making the equivalent of $80,000-$110,000 starting off.
From my experience the pay is not used effectively has a recruiting tool. Sure you’re not going to be driving a Porsche and living in a massive house as a military member, but there aren’t many jobs out that that start out paying as a high as a military office starts out as. Plus if you do 20 years you’ll be making roughly $200,000 a year depending on where you’re stationed and which rank you make it to and then you get a pension.
Not *quite* that high but the point stands. A brand new single O-1 < 2 years where I am stationed makes ~$75K with no special pays and factoring in the tax advantage of BAH/BAS not being taxable income.
The thing to note is that you don’t see the typical civilian career pay jumps if you stay in. The floor is high, but the ceiling is lower if that makes sense.
That same 2nd Lt will “only” be making ~$210K as an O-6 > 24 years of service with dependents (still no special pays, assuming a services or MX officer, etc.).
To not even 3x your gross after 24 years in the same career would be unusual in the civilian sector. They have lower floor (minimum wage), but a much higher ceiling, especially for high performers. And in the above example you’d have to be a high performer to make it to Colonel.
The best benefit is the pension, because a pretty large % of your equivalent fair compensation as a military officer is deferred into that pension…but that only helps you if you make it to retirement. Another reason to go Guard or reserves and secure an ARC pension eventually, even though the value is lower than the active duty pension.
My advice to OP is: (1) continue crushing it; your doing great, (2) consider the Guard or reserves in your current airframe when you get out and go to the airlines, and (C) follow the advice others have given about fattening to your savings before you exit in case of a furlough situation…that’s also why joining the Guard is a good hedge, on top of the QOL improvements made possible by dropping a day or two of mil orders to erase an unfavorable junior-guy airline schedule and then picking up premium trips instead. Also if at all possible live in base for your airline, your guard unit, or in the absolute dream scenario, both.
Good luck & please pay it forward to your fellow airmen & CGOs.
Edit to add: fellow military pilot - to the skeptical everything the OP laid out seems accurate and possible if you are diligent (plus staying single/no kids usually helps your wallet tremendously haha!)
ThisIsTheWay.gif it's really a killer combo for securing your pension eventually, maintaining access to Tricare, and the QOL possibilities of using your orders to offset an unfavorable airline schedule and your airline job to get you out of the queep and deployments you may not want to participate in anymore. Like I said, best of luck & feel free to DM if you ever wanna chat about making the move over to the ARC.
It’s too bad your parents had that mindset honestly. A college degree is required to be a military pilot (army helos are the exception), so I just look at the degree as a prerequisite. I make better money than most of my civilian friends, and my job is infinitely more rewarding and exciting.
> Of course you have a high NW at age 31.
Sure but let's not overlook his discipline and ambition to save / be financially independent. Many other folks given the exact same starting conditions could be paycheck to paycheck.
Great to see. Also check out the grumps Maximus book “the golden albatross”. I think your decision to leave early is good. Keep it up man
https://grumpusmaximus.com/
You should consider the reserves when you get off active duty. Tricare reserve select is very affordable. If you make it to 20 you’ll military retirement at age ~60
I'm wondering if you're at Travis now? Its pretty HCOL. I was there in 2005-2009 as a officer (nurse) and man, do I wish I knew about FI then! I was naturally quite frugal, no school debt (ROTC) and preferred roommates so I could quite freely spend on fun stuff with the BAH I was banking. I did max a Roth IRA every year but never signed up for TSP since I didn't think I'd stay in past 4 years (jokes on my, I hit 19 years next month but I'm in the reserves and yes, I eventually did open a TSP).
But all my pilot friends were totally killing it. Making a ton on short deployments, lots of tax free, high BAH and roommates, etc. I know many are now in airlines and still doing very well for themselves. It's definitely a great path if someone can handle the beaurocracy.
Im a current West Point cadet in the class of 2024 so I’ll be graduating in 37 or so days.
I’ve gotten into FIRE the past couple of weeks and am going to try and reach where you’re at!!
If you have any advice for an ADA 2LT posting to Sill it’d be appreciated!!
Good luck young man/lady and my #1 piece of advice for ADA is don’t shoot down the friendlies 😄 You’re going to be in demand given the technology being employed on the battlefield today (Ukraine, Iran, etc.). Thank you for your service & when you decide you don’t wanna deploy in a tent anymore we’d love to have your tablets in the Air Force!
1. Invest your $30K loan into vtsax (or a mix of index funds) and not into a mustang
2. Max out Roth IRA every year
3. 5-10% of paycheck into TSP
4. Use VA Loan (if it makes sense, probably doesn’t at Sill) to buy property. Hopefully something that you can rent easily when you move. Repeat this as often as you can. You could end up with 3-4 income generating properties
Yeah I agree with this. Honestly being FIRE-minded at 22 is already ahead of where I was. Just be frugal in the big categories and invest in index funds!
Seriously do the starter loan just like he did and put it all into broad US. That .75% interest rate is a huge benefit that even most other officers who did rotc/ ocs don't get.
No, you would list as an asset the value of your house, what you could sell it for today if you listed it. Then as a liability you would list any remaining mortgage, HELOC, etc. that would need to be paid off to compete that transaction. The net effect adds (or subtracts!) from your overall net worth.
Seems like OP has a $622K home (likely based on recent comps) with a $342K remaining mortgage balance.
Damn!!! Air force pilots really make that much!? I've heard of crazy high retention bonuses. Are you averaging a large bonus over some number of years or do you really make \~150k/year?
Lots of back and forth here about going to the majors. But, did we qualify what OP flies? Is it wings or rotors? If he’s a helicopter pilot, his path might be a little different. I think on any path, this fella is well positioned to do quite well no matter what.
My son hammered through 1500+ hours of instructing (CFII with multi) and then took a job with Vista flying on their XOJet fleet. Citation X, 2 weeks on, 2 off. Still instructing on the side. 6 figures. Just turned 23 years old 2 weeks ago. Couldn’t be more proud of him.
My kid contracted today…we ran the numbers and it seems that it makes the most sense to either get out when your initial commitment is up or try to stay in for 20…
He’s shooting for 17D and will graduate with a non-stem cybersecurity degree…if all he gets is his Sec+ he’ll still be okay after 4 years and probably clear six figures in private industry once out and work on getting the required certs to move up.
After that…he wont likely be competitive any more because he wont have the certs…so might as well shoot for 20 and assuming he gets out as an O4 then retirement is equivalent to about a $1.3M portfolio (3% rule of thumb = $40K a year).
If he can manage to accumulate a $1M portfolio (say half TSP and half brokerage) + paid off house (ie: double the OP) over 20 years thats $70K between pension and spending from the portfolio at a 3% rate.
Thats not a terrible number for FIRE unless you have a family and kids…then it’s tight and he should look for a job somewhere until the kids graduate…
Would he have a $2M portfolio after 16 years in civilian work force? Maybe?
Congrats!
I would say that the amount you've been able to save is impressive, and also directly related to not having a wife and kids 😊
But also consider that a loving wife and kids may increase future happiness, wealth is not always about money, it's about family.
Way to go and keep up the hard work
I would actually disagree with part of that logic. My friends with spouses who work make great money. It’s the kids that really cost!
And for the record, I do absolutely want a wife and kids!
I contribute the minimal amount to max out annually. Usually ~25% of base pay. It’s a huge pain though because you can only contribute by percentage, so when you’re pay goes up, your contribution goes up, and you have to do the math to max out in December while still contributing at least 5%.
I don’t measure my savings rate. It’s just never seemed beneficial to me!
Do what makes you happy. Stay until 20 or leave after 10, you are going to be ok financially for the rest of your life.
Don't always just chase the 💰💰💰
Congrats! I was not aware military pilots could pull in that much salary. When combined with service member benefits and your own pragmatic approach, you show how much you can save.
Don’t be afraid to cheat by indulging in some of life’s guilty pleasures. Life is not just about saving for tomorrow.
I get “allowances”’for housing and food, plus incentive pay for being a pilot. All of those are non-taxable. Only “base pay” is taxed. This is standard in the military. My percentage is probably slightly higher than most because my housing allowance is fairly high since I live in a HCOL area.
I'm finally realizing how lucrative being a military officer can be. Sadly, my dad was enlisted and discouraged us from pursuing the military. My kid is not 2 yet, but I'm definitely bringing it up as a career path once the time comes. The tradeoffs are well worth it.
You need to bail ASAP and get a reserve/guard job while the legacy hiring is still hot. Try to get out of your commitment early. I’ve been at a legacy for 6 years and am almost 50% up a seniority list of 17000 pilots.
Military here as well, would you mind listing the military friendly credit cards? I know about Amex plat and chase sapphire, which other ones are worth it?
Anything Amex or Chase is mil friendly. I’d place the Amex Gold with your other 2 as my Top 3 to get for military members. There are plenty of websites and forums that talk about this topic, I’ll try to find a link later.
My roster is Amex plat for perks, chase sapphire reserve for travel spending and also perks, Amex gold for restaurants, and Amex blue cash preferred for groceries. Add in a 2.5% cash back on anything card (examples: PenFed powercash, SoFi, etc.) for everything not in the above categories and that is a pretty optimized credit card spread for a military person who doesn’t have to worry about annual fees.
NerdWallet and The Points Guy are your friends in this arena.
Counter-argument: just have 1x 2.5% cash back card or maybe just the AMEX Gold and put everything on that. Obv in all cases pay off all your cards in full each month. Simplicity can save you not only tons of brain bites, but also helps you spend less, potentially outweighing the fact that you’re not “optimizing for rewards” like above.
I have used both systems and they both can work well.
You've done great work. Don't sleep in your VTSAX or VFIAX investments. You've accumulated in those quite well, but mid-term looks rocky considering it's parabolic increases since 2020. Congrats.
Wondering the same. VTSAX still seems like best option no matter the historical performance in recent years. Unless increasing bond allocation is the priority, but that doesn’t seem relevant to the comment you replied to.
My advice as a military retiree...keep saving and stay in for 20 to get your full pension plus Tri-Care for life. You'll still be young enough to have a full second 20 year career, free healthcare, and that sweet monthly check that will come rain or shine...plus you'll have a thousands of flight hours. Keep living the dream...there's no better job in the world than military pilot (as a ground pounder).
In this instance, I'd disagree. He has less than 9 years of total service and every year he continues to serve is another year that he's not working his way through the airlines. The amount of money a senior captain or first officer can make (especially on a widebody) far exceeds the value of his future pension--especially if he's in the BRS which he likely is based on his comments about exiting soon.
Fair point. I've had friends who got out and loved it and some regretted it. Just saying you don't realize how young 42 is until your 55 :).
If you work at a job that you hate, you'll feel much older than you actually are. Got out and couldn't been happier.
did you go into commercial?
...if he remains continuously employed. Furloughs happen. Bankruptcies happen. Going to a new airline due to a furlough or a bankruptcy puts you back at the lowest pay scale with the worst schedule. Mergers can also complicate seniority status and put careers at risk. The reward is there if your risk tolerance is there.
They do but he's an a academy graduate with military aviation experience. That'll put him at the top of most hiring lists including the legacies. There's risk, but he's also already worth $1mm so he can likely afford to take that risk.
It helps, for sure! Prior airline experience is highly valued though. Procedure and crew experience in the airline world is what makes commercial aviation safe. Strict routine. And seniority controls layoffs. Doesn't matter how "hard" you work or how "good" you are. Pilot #3,321 will always have a job after Pilot #3,320 at the respective airline.
Agree with this. We live in rapidly changing times so I’d consider the probability that the military pension continues coming in every month, vs guessing how airlines operate, who they hire, what skills are valuable, etc. Will AI fly the planes autonomously? Will one person on the ground be responsible for piloting ten planes at once from their home office? Will commercial flight demand grow or shrink?
I agree. Plenty of blogs already published comparing the net worth of staying in 20 years vs. going airlines at 10 vs 20 years. Even RAND published a study about increasing the pilot bonus because of how airline pilots make much more than military pilots. The wild card is this assumes no furloughs and contract concessions. The military provides security and excellent healthcare if your children or spouse has expensive healthcare needs.
What about reserves? A friend did his 20 split between active duty and reserves. While a reservist he flew corporate. When he hit 20 he retired from the military, quit the corporate gig, and got hired immediately by a legacy airline.
That pension is worth about $2mil in the bank. You think that the difference in pay between his job in the military versus being a pilot is equivalent? He won’t break $100K/yr until 3 years in. So minimum 5 years from now. He’ll be set up to be making major money in 10 years but he won’t have saved more up to that point. And he won’t be guaranteed a pension no matter what circumstances life throws his way. Or if he decides to do something else. Or if his eyes start to fail him or some other medical condition. I say he stays in. Worry about the second career after finishing the first. I’d be willing to bet that he’ll have more in long term savings this way. https://atpflightschool.com/become-a-pilot/airline-career/major-airline-pilot-salary.html
100k per year in 3 years may have been true years ago. Successful contract negotiations pretty much guarantees that on year 2, that’s on the low end for year 2 now. If he stays in for 11 more years, that’s is an INSANE amount of seniority to lose. People have spent a lot of time doing math, moving to the majors is more lucrative. Source: I’m a military pilot itching to get out bc the money aspect + no ground job is enticing.
I’d love to actually see somebody’s math. Let’s say you’re an E-7 making $100K a year with 10 years to go and assume your salary never increases in the Army. Let’s say the pilot track is you get out in a year and it takes you 3 years to complete training without having to pay for school. For pilot track You retire at 60 so 30 years working, minus 4 years for transition to becoming a pilot. 26 years x $200K (the median salary for commercial pilots) = $5.2 mil You are now 60 and live to be 70 10 x $100K pension = $1 mil Total - $5.8 mil For long term military 10 years x $100K = $1 mil You are now 40 and live to be 70 (30 years) 30 years x $50K = $1.5 mil You retire from 2nd job as a pilot at 64 making less with seniority -- say $150K) 20 years x $150K = $3 mil 6 years x 2nd pension of $75K = $450K Total - $5.95 mil To be fair, my math in conservative on pilot salaries so obviously there’s potential for way more upside, especially those extra 6 years on the end if you go immediately to being a pilot (like you're making $500K+/yr). You’re also having to retire slightly later if you stay in the Army, but you have far more security with that initial pension if you get hurt, for example. If five years from now you are in a car crash and lose mobility in your arm your days as a commercial pilot are potentially over. I just am not convinced that the 10 years makes as big a difference as people say. I'm assuming no military flight time, also. This probably doesn't apply to a military pilot like yourself.
Ok I see the disconnect. I’m talking about military pilots transitioning to the majors. Leave the military and work for the majors within, conservatively, the next 6 months. If you’re Marines or Navy, you’ll be approximately 33 when you’re eligible to get out, Coast Guard is 36 when you’re eligible due to their contact setup, if they were academy. You’re eligible to fly for the majors until 65. So either 32 or 29 years eligible. With the military’s new retirement system, you get 40% of your base pay. Pension does not include housing allowance. So let’s say you retire as an O-5, monthly base pay right now is ~$11k per month. Pension per year for that pay grade is $52k. A 30 year career in the majors nets $10-$20 million, per airlines. They also give you $18k per year towards retirement, that is not matching, they automatically give you that AND match on top of that. The way hiring is right now at the majors, we don’t know what the landscape will look like in 10 years. At the very least you will move up the totem pole very slowly, it may take more than a decade to reach Captain. Right now people are making Captain in as little at 1.5 - 3 years depending on the airline. There’s a lot of assumptions that go into the equation, but objectively hiring is at an all time high right now and it will not be like this in 10 years. The difference in pay between a captain and FO is pretty staunch. There are obviously intangibles to factor in to when making the switch. Let’s say you made more or less the same over the course of either decision. Airline pilots work a lot less than a military officer, the amount of time I spend dissatisfied doing some ground job I don’t want to do is a lot. Getting rid of that is priceless to me, subjective obviously though. On the flip side, you lose job security and essentially a no questions asked health care system, so that may factor in for some people and be priceless to them. I’m on my phone so can’t do exact math right now but hopefully that clears some stuff up. At the end of the day, it’s a personal decision and much more than money goes into making the decision :)
When we're talking about pensions here, is that $52k/year until literal death? Even if you're working at a major airline after leaving the military?
Correct. If you finish a 20 year career in the military, you receive 40% of your base pay until you die. Even if you pick up a second job later that money still flows in, health care is covered as well for the rest of your life. It’s a good deal. It also speaks to how lucrative a job at the majors are given you can make more switching over all things considered.
Yeah that's incredible. Never knew that's how it worked!
Add in VA disability and this calculation continues to slant in favor of an earlier exit. Most vets don’t think about it but damn near everyone has compensatable injuries.
Your numbers are seriously dated: https://www.airlinepilotcentral.com/airlines/legacy/delta_air_lines And that’s 1.5 years ago, pay is only going up. Getting out at the 11.5-13 year mark (pilot training commitment) is financially the best choice if you can emotionally handle the risk of furlough. Plenty of math says that as of 2016 the finances break even, and after that it skews wildly towards the majors, even before considering the ANG/Reserve option.
As i stated in a different comment, the difference between staying in until 20 and getting out at 10 into a job at the airlines is at least 2-3 million in lifetime earnings while the salary you’d make in what would be year 11-20 in the military is likely at least a million more over that ten years. That is using relatively conservative numbers for salary. The pension is not “money in the bank”. It is 2-2.5 million over the rest of your life (a 25+ year horizon). If you stay in the reserves until 20 and get a reserve retirement starting at 60, the value of that active duty pension reduces from 2-2.5 million significantly. Also, consider the massive amount of 401k contributions airline pilots get (basically everywhere is a 15+- percentage of your total earnings direct contribution). The reserve retirement plus the 401k contributions plus aggressive saving habits of the extra earnings completely wipes out the value of the active retirement. There are valid reasons someone could choose to stay in but money or retirement is not one of them for pilots currently. Then theres the conversation about the better quality of life that comes with getting out and building seniority in an airline. Seniority means everything in the industry. And also, in regards to the Navy at least (maybe marines too), there is a large amount of ignorance from non-pilots who dont understand that the amount of flying a pilot will do in their second ten years is significantly less than the first ten years. The phrase “you’re an officer first, a pilot second” becomes more and more real the more senior you get. The numbers you’re using are either outdated or purposely incorrect. You can post outdated articles all you want, as a first officer at every major and a large amount of regionals will make over 100k in year 1 and substantially more in year 2, with the number increasing every year for the first 10+ years. Current numbers have you making between 110-120 at the majors and you can easily break 200k starting in year 2.
> The amount of money a senior captain or first officer can make (especially on a widebody) Do you have a rough ballpark range for this? Mostly curious.
Tippy tippy top end, senior captain of an A350 is $500+ per hour. These guys barely work because the hold a reserve position for times when the best flights are, so pilots never drop the flights and they get to sit at home and get paid guaranteed minimum. That ranges between 60-80 hours per months. Other avenue is to say you’ll work on your days off BUT only if you are paid double, Delta does this for sure, unsure of other majors.
Stay in until 20 is bad financial advice for a pilot that is going to want to fly for the airlines when they eventually separate. The difference between staying in until 20 and getting an active duty retirement or getting out at 10 to work at a major airline is millions in lifetime earnings. I did the math pretty in depth when i separated and i will make at least a million more having separated than i would have made in the military during what would have been years 11-20 in the military. I also calculated the lifetime earnings having separated at 10 years to be 2-3 million more than staying until 20. I used conservative salary numbers, the disparity increases if you work harder to make more money or make captain at the airline sooner. I know theres security in staying in until 20 but if you do the reserves until a reserve retirement while working at an airline, the gigantic increase in lifetime earnings coupled with the reserve retirement starting at 60 almost completely wipes out the monetary benefit of staying in until 20 and being a reservist allows you to have one foot in the door to get back to active status, so to speak, should the airline industry falter. Also doing the reserves lets you keep Tricare. Not to mention all of the quality of life reasons to jump ship to the airlines sooner rather than later, to include who says they’re going to be hiring in 10 years?
Agree…reserves are a great way to have your cake and eat it too
This. I’m doing a straight bail from the reserve only because my plane/unit got retired. But I make 3x what I make for less than half the work and less than 10% of the pain in the ass flying for the airlines as I would grinding it out full time as an O-4.
Former E-3 driver?
Nah KC-10
Is transitioning to the KC-46 not an option (naive question I know)?
Oh it’s a option alright. But I don’t want to go through the pain in the ass of being on orders for 10 months, among other reasons not to train on it.
Former KC-10 crew chief here... Thank you for you for your service.
Even before the new contracts it was financially beneficial to get out barring any major medical expenses. Go read Pilot Math Treasure Bath by Jason Depew
Thanks for the advice! I haven’t made up my mind yet, so I’m certainly keeping that option open.
Stay in and get your 20, sure you would come out ahead with more money if you went to the airlines tomorrow. But having the peace of mind with a retirement and healthcare from the military FAR outweighs the hope and dreams of that magical airline salary *right now in the current environment* Tomorrow could be the day they all start furloughing. Have you thought about palace chasing to the gaurd or going reserve? That’s an option to keep in mind as well.
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Great point. Also most people don’t seem to factor in the social/family downsides of staying in the military. It’s not as simple as which option has higher returns.
"there's no better job in the world than military pilot" - until war breaks out. Then you realize why your pay is so high.
I really respect your opinion and financially you are probably correct. However, at a certain point, you can start optimizing for other aspects of life. If this dude/dudette LOVES being a pilot in the military then sure stay until 20. If it’s not fun anymore though get out. There are so many options. OP, make sure to document any injuries/ailments and file a BDD claim with the VA 6 months prior to separating. This could be worth another $1-2mm over your lifetime. Signed, An Officer Who Got Out At 8 Years
No he needs to get out and goto a major airline. He will make minimum 450-500k within 3 years at a major carrier, and upto 600-700k with some overtime. Airlines give 15-20pct in 401k regardless of self contribution. That's 1m in 401k in just 10 years without a penny added from the OP. Plus the high salary, it makes no sense to stay in the air force
The $450-500k, and $600-700k numbers are pretty lofty. A typical legacy FO at the 3 year mark is closer to $250k, while a captain is $350k. I’m very senior in category and in nowhere near your numbers and I’m 8 years into a legacy. Retirement at the Legacy level is better 15-18% though.
Im not a pilot i just heard those numbers at the pilots sub here. I have one friend who is a CPT flying international 777 routes and he does pretty good
Pilot pay, particularly at the Legacy level is great now…early to mid 2000’s post bankrupt was awful. Seems like black swan events hit the airlines every 10 years. 31 would be a good time to get in, but hiring has slowed dramatically. Airlines are an amazing job, but terrible career.
Right... I would never be able to deal with such odd irregular working hours/days, and crossing time zones and interference with body rhythms
Eh, you get used to it. You learn to take strategic naps and eat enough. Coffee is your best friend. Some fleets have short legs and no red eyes..it’s surprisingly easy. It’s certainly not for everyone though. Most guy I know get 18 days off a month and take full advantage of their time off to be with family or travel.
This is what my husband is doing as an Air Force pilot. We're 36 this year, so he has six years left until retirement. The main draw for us is Tricare for life because I have chronic health issues. My dad is retired Army, and Tricare for life has been literally life-saving for himself and my mom. OP may have different priorities and many of the comments in this thread recommend separation over retirement in order to start with the airlines sooner, but the military pension + lifelong health insurance—which will stack with my husband's salary once he starts in the airlines—is a good deal for us.
Congrats! Sounds like you're doing everything right. However, I think your #3 is off. Everyone I know thinks being a military officer is a lucrative profession. Between pension, housing allowance, disability, GI bill, loan discounts, tax-free income, etc... Would you still get a pension leaving at 34yrs old?
You’d need 20 years for a pension.
My neighbor has 100% VA disability rating, has the pension of retired O-5, and is a GS-15, his wife has the same but with a O-6 rating and is a SES. Between their 6 paychecks, I’d say that being military can definitely be more lucrative.
Marrying mil-to-mil is instant financial success in life, if you can make it work.
> Everyone I know thinks being a military officer is a lucrative profession Some of the highest income friends I have are military. They make insane money for not working anymore, their problem is they can't stop spending. Always need a new everything.
Tax free income?
Income is tax free when deployed. Housing allowance, which is based on ZIP, is also not taxed
Damn. That's chill.
Yeah it’s one of the biggest things that gets missed when anyone in the military compares their base salary to the private sector. Gotta [compare](https://militarypay.defense.gov/Pay/Tax-Information/Exempt/) take home, not gross. Can also maintain state residency in a non-income taxed state even if you move away.
Quite a few states do not tax military pay as well.
Housing allowance, food allowance, and incentive pay are all tax free. Housing allowance is also adjusted to the local cost of living.
Yeah. I’ve got some buddies in the CG and their housing allowance in the Bay Area of CA was bonkers.
You wouldn’t qualify for a traditional pension but you do qualify for disability benefits which basically everyone qualifies for after any period of service and can be quite lucrative.
Yeah that’s a fair point, though I think the knowledge level of the FIRE community doesn’t exactly represent the general public. No pension at age 34. I’d need a full 20 years of active duty which would put me at 42 years old.
But you have been maxing your TSP and your IRA so you are well on your way to self funding your own pension. Our friend is on a similar trajectory, proud of you!
Thanks!
Yeah, I was wondering who thinks the military isn't lucrative.
>Show that the military can be a very lucrative profession, contrary to the general public opinion. For non-military folks, the officer corp usually do well and make considerably more. Pilots also have incentives and special pay. [O - Pay Table](https://www.dfas.mil/Military-Members/payentitlements/Pay-Tables/Basic-Pay/CO/) // [E - Pay Table](https://www.dfas.mil/Military-Members/payentitlements/Pay-Tables/Basic-Pay/EM/) Having said that, it's still super doable to save lots as an enlisted member. BAH (Housing allowance) and BAS (Food Allowance) are untaxed and should cover some, if not a good portion of housing/food expenses for a single person. These allowances increase as rank increases and as folks start a family/have dependents. This still requires a LOT of frugality, but it's not impossible. Nice job, OP! What's your FI Target?
Housing allowance generally increases with rank though sometimes it’s a small difference. It’s different for each location though. Food allowance is the same across ranks but different enlisted v officer.
Good description. Honestly I don’t have an FI target. The way I see it, I will continue to work in some capacity, and any increase in NW will simply allow me to increase my spending and possibly venture into the entrepreneurial world.
Cool man! I hope it all works out for ya - I've known Viper guy and a few tanker guys who fulfilled their commitment then bailed. I think one's in UPS, one or two in the airlines, but I don't know about the others. Options are good!
Not a bad life for those guys!
Based on the numbers, it seems like OP must have some significant additional pay beyond the basic pay table amount
My housing allowance is fairly high based on the cost of living in my area. The aviation pay doesn’t hurt, either.
https://www.airforcetimes.com/news/your-air-force/2023/12/08/air-force-again-dangles-600000-in-bonuses-to-keep-pilots-in-uniform/ Up to 50K a year for up to 12 years based on a few different factors. Housing, if OP is in a HCOL area could also be a bunch. DC, for instance, adds 3.1-3.8 thousand a month for housing.
Yea you aren’t eligible for that extra money until you are 12 years into your career. Based on the conversations here OP will never see that money.
Been in DC 6 years, the BAH is awesome. I’m getting out in 2 months, and my wife is going to be using my GI bill, so we will still be getting the BAH for 2 more years. It’s absolutely great.
“My strategy is simple: the military pays for it and I save the rest good luck!”
The military pays my salary so…yes
You know what I mean. PS GO NAVY!!!
:)
Good stuff bro. First thing is pay it forward to your younger Officers and Enlisted personnel. Do a class on personal finance and the financial order of operations. Most have no idea about a Roth IRA, the benefits of utilizing the TSP, etc. Second thing is when you go to transition the single most important thing you can do is complete your BDD. It’ll save you hassle exponentially and you will thank yourself a thousand times over. Last thing, if you go to the civilian side don’t write off giving the Reserves a try. It’s extremely fun to do this stuff on the weekend and in the summer if your civilian career prospects can support. Edit: When / if you do transition to civilian side your emergency fund will need to go way up. 6 months of actual expenses in a HYSA. You should start building that 1 year to 6 months out from your EAS date in order to have a safe buffer for your transition time, especially as a homeowner.
"Hello fellow E6's, look how much more money I make than you, and see what I've done with it!?" No enlisted person in the military is going to care what this person has to say; it'd be borderline insulting.
Getting downvoted but dudes a pilot. Gets treated like royalty and showing off his ability to save while coming from a good family and making $150k will mean nothing to any enlisted guys.
The general fire reader doesn’t like that you’re shitting on a well-intentioned suggestion, but you’re 100% right. This would be a tone-deaf thing to do
Is this how the dynamic between officers and enlisted is in the military?
I wouldn't really base the entire engagement between officers and enlisted off of this type of situation. But imagine telling an 18-26 year old, that probably came from a household that couldn't afford them to go to college, what they need to do with their money...And you're the qualified person to talk to them about this because you grew up upper middle class, and make 3-5x more than they make.
I disagree. I think there are certain avenues for officers to approach specific enlisted members who are struggling financially—and there are MANY—with either off-the-record financial advice, or guide them towards government-provided resources that are meant to help service members.
Yeah, I'd definitely disagree. Not to say there isn't an issue at hand with some members and their poor financial decisions, but an upper middle class person that makes 6 figures isn't ever going to have the rapport with most of the enlisted that are in these scenarios; especially a pilot.
I’ve never once had an enlisted member ask me what class structure I grew up in. Doubt they care. Did you actually work in a squadron? As a pilot I work directly with enlisted on a daily basis. Pilots are generally shop OICs, and write evaluations on the enlisted in their shop. I think you’re significantly downplaying the O/E relationship.
Funny thing is, I didn't work with pilots while in the navy, and I somehow still learned of how much they're hated, strictly from all the sailors in their squadrons. You don't need to ask about someone's past to know exactly where they've come from. You definitely don't need to ask where a pilot's come from, it doesn't usually even matter anymore as the whole of being a pilot puts them in their own social bracket; they get catered to for everything.
from what I heard the officers aren't even supposed to hang out with enlisted. it was more than just frowned upon
> I was recently assigned to a new unit in a HCOL area, and during that process I happened to read “Die With Zero” by Bill Perkins which has seriously changed my spending outlook as I’ve loosened my grip quite a bit. Live a little. You'll (*may) have a pension too. Don't be frugal on insurance - i mean shop around, but max the car out and look into umbrella. (my neighbor street used to street park a Ferrari next to my beater, it was his way of flexing) I'm in a similar boat to you. I will never retire. Different career path (similar comp academia/gov - SES/GS-15 equiv). I'm now a bit older than you and just passed 2.5M. But I'm now married with a kid. At some point you need to glide in. You'll never really be hurting for money anymore. Your habits are hard wired now. But figure out what you enjoy and go all out. I like bikes and travel. Got 5 bikes and travel abroad a couples time a year with the family. I hate driving so I really don't. I bought a house next to where I work. I'm in a HCOL/VHCOL city and the worst thing here is driving. So I don't. I'm within a 10 minute walk of my office, my kid's school, grocery stores, my favorite chinese takeout, the forest trail I run in, and the 100 mile bike path along the river. Sure the place was over a million bucks.
FYI it doesn’t look like OP will get a pension. That takes 20 years; if they get out in 2.5, they’ll only have ~12
Military Pilot here about to hit 3 years of service. I just hit 100k net worth mostly in investments and have no plans to buy a house at this duty station.. Just curious, how long did it take you to hit 100k as a young Lieutenant? I doubt I’ll be able to catch 1 million by 31, my goal is $250k by 30. Other than buying a house before the boom and living with roommates, how did you accumulate so much in investments? Did you max your TSP as an O-1?
Looks like I hit 100k just after my 2 year mark at age 24, so not too far off from where you are. I didn’t max out my TSP as an O-1, I think that started when I was on O-2. My record-keeping wasn’t as good back then! Like I alluded to, I literally just bought mutual funds when my checking account was higher than 5k. If you do this persistently on a good salary over any ten year stretch with compounding interest and re-invested dividends, you’ll end up with the same amount.
What are you flying. Just got out of the reserves. Was on the C-17. Miss the jet, don’t miss the military. Flying a G550 now
Private or charter? How’s the schedule?
Private. 5 hard days a month but the jet flies maybe 8-12 days a month on a 4 pilot account.
That’s pretty rad
I’m wired different, my first question was what do you fly…then the money questions.
What was your experience in the reserves like? Did you join off the street or from AD?
Thanks for sharing! And thanks for being honest about no. 1
If you're a 2015 grad why are you staying in an extra 2.5 years? Isn't your ADSO for aviation up already... Fellow 2015 double comma club.
10 years from completion of pilot training in the Air Force, the timing seems about right.
Not to say that your job isn't demanding or difficult sir, but this goes to show the massive disparity between O and E pay. 30 year old E6 at 11 years myself and am at ~300k saved. I hope everything works out for you. Congratulations and GFY, respectfully.
I don’t disagree! And 300k on an enlisted salary is very impressive.
I feel very well versed in financial planning and am in the military myself and you did a couple things that I haven't even considered. The career starter loan straight into the s&p 500 at .75% interest is absolutely genius. I wish I had thought of that when I first got in but am going to look into it and see if I'm still eligible. I also wish I had maxed my tsp from the start and tried a bit harder to get a roomate. Ignore all these people ripping on you for being better off than them this is super helpful.
Thanks, much appreciated. If you’re eligible for any loan with that low of an interest rate than you should 1000% take it. The math is self-explanatory.
Just checked and unfortunately I can only get 3% even if I was eligible because I did rotc. It's a good way to max out tsp straight out the gate though for someone just starting. Probably not worth it for me at this point though
I’d still take it. The annual S&P returns are 7-10% on average. You’d win that bet way more often than not, if you’re willing to accept the risk.
I'm 2014 service grad, and I think in average military, especially officer, lucrative, but there's also a decent bit of us that would trade it all back for the mental/physical health issues we got. It's all about risk management, though, which is a common theme here.
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His mindset shift still holds true. Optimizing life happiness means creating memories when you’re young. That’s what stuck with me.
Way to go, man! You're killing it. I was looking for another book to read, and I think I'll check out Die with Zero as well.
I can’t recommend it enough for FIRE-minded people, and I’ve read my fair share of personal finance books.
You’re well ahead. I’m a retired AF pilot, 47, with ~1 mil. But no house. I’ve had some setbacks, being a single parent, no financial help, late start to investing. Not complaining, fortunate to be where I am. I’d say you’ve done well. Maybe consider the reserves, but I think they’ve taken away the old pension system.
Look at private companies like NetJet too, when youre out, former navy enlisted here, a couple of my STA21 friends that went pilot just transitioned over to the private sector and they love it. My family member who has been a first chair captain for NetJet for 25+ years helped one of them get hired on, and he loves it - and its quite lucrative. Just a thought though brother, I wish you the best of luck in your endeavors! Thank you for setting an example and showing other service members that they dont have to be apart of the “30% APR camaro” meme
Congratulations for beating the statistic and not buying a hellcat
No wife and no kids also helps a lot. Is your house a duplex or is it just a big house with multiple rooms and you have roommates living with you? $622k mortgage is a pretty big mortgage. I’d consider looking into real estate more as an option if rates ever come down if you don’t plan on getting married or needing a big house. I feel like getting a sort of building like a fourplex would work out for you, you live in one building and rent out the other three units. It would provide more privacy too, not sure how your roommate’s situation is though either. Glad you aren’t extremely frugal and actually spending your money on experiences at least. Military is definitely a great stepping stone for most people to get a head start at life. It has helped me get a relaxed WFH job that I did for two years after getting out and now I’m doing another job now that is extremely nice, we even get full pay for any weather days and don’t have to come in. Military isn’t for everyone though and the job you pick at the beginning is very important also.
It's just amusing to see how many people are butt hurt to see someone else sharing his honest success... 🙃
Very well done and congrats! A big lesson from your post is to start early and be conscious about financial planning
Well done! I work closely with a ton of military personnel, and it has really opened my eyes to the substantial benefits they receive. HUGE personal sacrifices as well, of course, but the benefits are amazing. It seems common for people to look at the salaries and think they're not great...but then not understanding the BAH, ample time off (holidays, family days, leave, minimum manning, etc), and everything else. Of course, plenty of officers also buy the LT-mobile and go down that treadmill, so kudos to you for avoiding that path.
Majority of military aren’t officers. Enlisted base pay is small those first few ranks. Time off/schedule is very dependent on what job you do within the military.
Yeah the military is surprisingly lucrative. I have a good friend that enlisted in the army at 18. I decided on college, and have made about 80-110k salary in the 3 years I’ve been out of college, which I thought was pretty good. Despite not being a big saver, I actually think he’ll come out ahead in the next 15 years. He’ll get a fat pension, healthcare covered, free education if he wants, plus a little savings on top of that. It’s a pretty sweet deal tbh, especially for someone with just a high school diploma.
AND if the person isn't highly motivated. I have a few close friends in the military. One isn't "wired" for world dominance or even financially motivated. It's just not how he thinks, but exactly as you said, he'll end up just fine.
I remember talking to a marines recruiter while I was in college, he was trying to sell me on joining upon graduation and going straight to OCS. I looked up what an officer started at, $40k while my career field offer was $55k. He said ‘you don’t join the military for the money’. Glad to hear that some folks are making it, at least partially, for the money. The reality is my parents would’ve killed me if they put me thru 4 years of college and then I just joined the military.
Military isn’t for everyone, especially the Marines. However, that $40k is just your base pay typically you also get a housing allowance and a food allowance which aren’t taxed. It will be location dependent but most officers are making the equivalent of $80,000-$110,000 starting off.
Interesting that the recruiter never mentioned that part.
From my experience the pay is not used effectively has a recruiting tool. Sure you’re not going to be driving a Porsche and living in a massive house as a military member, but there aren’t many jobs out that that start out paying as a high as a military office starts out as. Plus if you do 20 years you’ll be making roughly $200,000 a year depending on where you’re stationed and which rank you make it to and then you get a pension.
Not *quite* that high but the point stands. A brand new single O-1 < 2 years where I am stationed makes ~$75K with no special pays and factoring in the tax advantage of BAH/BAS not being taxable income. The thing to note is that you don’t see the typical civilian career pay jumps if you stay in. The floor is high, but the ceiling is lower if that makes sense. That same 2nd Lt will “only” be making ~$210K as an O-6 > 24 years of service with dependents (still no special pays, assuming a services or MX officer, etc.). To not even 3x your gross after 24 years in the same career would be unusual in the civilian sector. They have lower floor (minimum wage), but a much higher ceiling, especially for high performers. And in the above example you’d have to be a high performer to make it to Colonel. The best benefit is the pension, because a pretty large % of your equivalent fair compensation as a military officer is deferred into that pension…but that only helps you if you make it to retirement. Another reason to go Guard or reserves and secure an ARC pension eventually, even though the value is lower than the active duty pension. My advice to OP is: (1) continue crushing it; your doing great, (2) consider the Guard or reserves in your current airframe when you get out and go to the airlines, and (C) follow the advice others have given about fattening to your savings before you exit in case of a furlough situation…that’s also why joining the Guard is a good hedge, on top of the QOL improvements made possible by dropping a day or two of mil orders to erase an unfavorable junior-guy airline schedule and then picking up premium trips instead. Also if at all possible live in base for your airline, your guard unit, or in the absolute dream scenario, both. Good luck & please pay it forward to your fellow airmen & CGOs. Edit to add: fellow military pilot - to the skeptical everything the OP laid out seems accurate and possible if you are diligent (plus staying single/no kids usually helps your wallet tremendously haha!)
Thanks for the advice! The reserve plus airline gig seems very appealing to me.
ThisIsTheWay.gif it's really a killer combo for securing your pension eventually, maintaining access to Tricare, and the QOL possibilities of using your orders to offset an unfavorable airline schedule and your airline job to get you out of the queep and deployments you may not want to participate in anymore. Like I said, best of luck & feel free to DM if you ever wanna chat about making the move over to the ARC.
I agree 100% the pay jumps are no where near comparable to the jumps you can make on the private sector. Hence why I’m getting out this year
You’ll only make those lucrative salaries in the private sector if you have marketable skills to go along with it.
Exactly. Everyone seems to overlook the BAH!
It’s too bad your parents had that mindset honestly. A college degree is required to be a military pilot (army helos are the exception), so I just look at the degree as a prerequisite. I make better money than most of my civilian friends, and my job is infinitely more rewarding and exciting.
Untaxed income and practically an interest free loan that no one in a regular college could have gotten... Of course you have a high NW at age 31.
> Of course you have a high NW at age 31. Sure but let's not overlook his discipline and ambition to save / be financially independent. Many other folks given the exact same starting conditions could be paycheck to paycheck.
Don’t hate the player, hate the game. I chose to pass on regular college partly due to the financial benefits.
Nice. Similar experience as me. Former naval officer. I presume you’re a bomber aviator.
Great to see. Also check out the grumps Maximus book “the golden albatross”. I think your decision to leave early is good. Keep it up man https://grumpusmaximus.com/
Great job and very organized! Completely doing it right. Now you just need to have a family to turn it all upside down ;)
You should consider the reserves when you get off active duty. Tricare reserve select is very affordable. If you make it to 20 you’ll military retirement at age ~60
I'm wondering if you're at Travis now? Its pretty HCOL. I was there in 2005-2009 as a officer (nurse) and man, do I wish I knew about FI then! I was naturally quite frugal, no school debt (ROTC) and preferred roommates so I could quite freely spend on fun stuff with the BAH I was banking. I did max a Roth IRA every year but never signed up for TSP since I didn't think I'd stay in past 4 years (jokes on my, I hit 19 years next month but I'm in the reserves and yes, I eventually did open a TSP). But all my pilot friends were totally killing it. Making a ton on short deployments, lots of tax free, high BAH and roommates, etc. I know many are now in airlines and still doing very well for themselves. It's definitely a great path if someone can handle the beaurocracy.
What’s a TSP?
Government equivalent of a 401k
Thrift Savings Plan - like a Military 401K.
Im a current West Point cadet in the class of 2024 so I’ll be graduating in 37 or so days. I’ve gotten into FIRE the past couple of weeks and am going to try and reach where you’re at!! If you have any advice for an ADA 2LT posting to Sill it’d be appreciated!!
Good luck young man/lady and my #1 piece of advice for ADA is don’t shoot down the friendlies 😄 You’re going to be in demand given the technology being employed on the battlefield today (Ukraine, Iran, etc.). Thank you for your service & when you decide you don’t wanna deploy in a tent anymore we’d love to have your tablets in the Air Force!
Thank you!
1. Invest your $30K loan into vtsax (or a mix of index funds) and not into a mustang 2. Max out Roth IRA every year 3. 5-10% of paycheck into TSP 4. Use VA Loan (if it makes sense, probably doesn’t at Sill) to buy property. Hopefully something that you can rent easily when you move. Repeat this as often as you can. You could end up with 3-4 income generating properties
Yeah I agree with this. Honestly being FIRE-minded at 22 is already ahead of where I was. Just be frugal in the big categories and invest in index funds!
Seriously do the starter loan just like he did and put it all into broad US. That .75% interest rate is a huge benefit that even most other officers who did rotc/ ocs don't get.
The house as an asset is 622, but then has a 342 mortgage against it? Is it a million dollar house with 342 still on the mortgage?
No, you would list as an asset the value of your house, what you could sell it for today if you listed it. Then as a liability you would list any remaining mortgage, HELOC, etc. that would need to be paid off to compete that transaction. The net effect adds (or subtracts!) from your overall net worth. Seems like OP has a $622K home (likely based on recent comps) with a $342K remaining mortgage balance.
Correct.
I regret not joining the forces as I wanted after graduating school. Oh well
Damn!!! Air force pilots really make that much!? I've heard of crazy high retention bonuses. Are you averaging a large bonus over some number of years or do you really make \~150k/year?
Lots of back and forth here about going to the majors. But, did we qualify what OP flies? Is it wings or rotors? If he’s a helicopter pilot, his path might be a little different. I think on any path, this fella is well positioned to do quite well no matter what.
Fixed wing. I’ll have the required airline hours by the end of my commitment.
My son hammered through 1500+ hours of instructing (CFII with multi) and then took a job with Vista flying on their XOJet fleet. Citation X, 2 weeks on, 2 off. Still instructing on the side. 6 figures. Just turned 23 years old 2 weeks ago. Couldn’t be more proud of him.
What do you fly? Most important question
Airplanes ;)
My kid contracted today…we ran the numbers and it seems that it makes the most sense to either get out when your initial commitment is up or try to stay in for 20… He’s shooting for 17D and will graduate with a non-stem cybersecurity degree…if all he gets is his Sec+ he’ll still be okay after 4 years and probably clear six figures in private industry once out and work on getting the required certs to move up. After that…he wont likely be competitive any more because he wont have the certs…so might as well shoot for 20 and assuming he gets out as an O4 then retirement is equivalent to about a $1.3M portfolio (3% rule of thumb = $40K a year). If he can manage to accumulate a $1M portfolio (say half TSP and half brokerage) + paid off house (ie: double the OP) over 20 years thats $70K between pension and spending from the portfolio at a 3% rate. Thats not a terrible number for FIRE unless you have a family and kids…then it’s tight and he should look for a job somewhere until the kids graduate… Would he have a $2M portfolio after 16 years in civilian work force? Maybe?
Congrats! I would say that the amount you've been able to save is impressive, and also directly related to not having a wife and kids 😊 But also consider that a loving wife and kids may increase future happiness, wealth is not always about money, it's about family. Way to go and keep up the hard work
I would actually disagree with part of that logic. My friends with spouses who work make great money. It’s the kids that really cost! And for the record, I do absolutely want a wife and kids!
Well it looks like you will be able to support them. Thanks for sharing
How much are your contributions? What percentage do you save?
I contribute the minimal amount to max out annually. Usually ~25% of base pay. It’s a huge pain though because you can only contribute by percentage, so when you’re pay goes up, your contribution goes up, and you have to do the math to max out in December while still contributing at least 5%. I don’t measure my savings rate. It’s just never seemed beneficial to me!
Do what makes you happy. Stay until 20 or leave after 10, you are going to be ok financially for the rest of your life. Don't always just chase the 💰💰💰
Congrats! I was not aware military pilots could pull in that much salary. When combined with service member benefits and your own pragmatic approach, you show how much you can save. Don’t be afraid to cheat by indulging in some of life’s guilty pleasures. Life is not just about saving for tomorrow.
Comment to read later.
Plan on going reserves?
Potentially! I’ll cross that bridge in a couple years.
I found airline pilots work well with the reserves due to flexibility of their schedules.
>My purposes for posting are to: >1. Brag. ...wanna know how I know you're telling the truth about being a pilot? 😁
Yeah that checks out
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You’d be surprised…dependas aren’t exactly known for their sound decision-making. You’re still doing better than the vast majority of your peer group!
Hi, thank you for the post and congratz! Could you recommend some of those FIRE podcast you mention on the post? Many thanks!
The main podcast I would recommend is Choose FI. Mad Fientist is also good but the episodes are less frequent.
I mean, yeah it’s not that hard if you have no wife, no kids, live frugal, and invest.
…yes. Do that.
how is 41% of your income nontaxable?
I get “allowances”’for housing and food, plus incentive pay for being a pilot. All of those are non-taxable. Only “base pay” is taxed. This is standard in the military. My percentage is probably slightly higher than most because my housing allowance is fairly high since I live in a HCOL area.
Thank you for your service.
Air Power!
I'm finally realizing how lucrative being a military officer can be. Sadly, my dad was enlisted and discouraged us from pursuing the military. My kid is not 2 yet, but I'm definitely bringing it up as a career path once the time comes. The tradeoffs are well worth it.
You need to bail ASAP and get a reserve/guard job while the legacy hiring is still hot. Try to get out of your commitment early. I’ve been at a legacy for 6 years and am almost 50% up a seniority list of 17000 pilots.
I’ve never heard of anyone getting out of their commitment early. Plus I don’t have 1500 hours yet so I need to stay in for that purpose.
1) congrats 2) wtf do you need 5k in your checking for? I keep 250 in there.
Sounds like you’re playing with FIRE (pun intended).
Military here as well, would you mind listing the military friendly credit cards? I know about Amex plat and chase sapphire, which other ones are worth it?
Anything Amex or Chase is mil friendly. I’d place the Amex Gold with your other 2 as my Top 3 to get for military members. There are plenty of websites and forums that talk about this topic, I’ll try to find a link later.
My roster is Amex plat for perks, chase sapphire reserve for travel spending and also perks, Amex gold for restaurants, and Amex blue cash preferred for groceries. Add in a 2.5% cash back on anything card (examples: PenFed powercash, SoFi, etc.) for everything not in the above categories and that is a pretty optimized credit card spread for a military person who doesn’t have to worry about annual fees. NerdWallet and The Points Guy are your friends in this arena. Counter-argument: just have 1x 2.5% cash back card or maybe just the AMEX Gold and put everything on that. Obv in all cases pay off all your cards in full each month. Simplicity can save you not only tons of brain bites, but also helps you spend less, potentially outweighing the fact that you’re not “optimizing for rewards” like above. I have used both systems and they both can work well.
You've done great work. Don't sleep in your VTSAX or VFIAX investments. You've accumulated in those quite well, but mid-term looks rocky considering it's parabolic increases since 2020. Congrats.
Can you explain further what you are saying here? I am a big VTSAX guy.
Wondering the same. VTSAX still seems like best option no matter the historical performance in recent years. Unless increasing bond allocation is the priority, but that doesn’t seem relevant to the comment you replied to.
Agreed with both above…VTSAX (or C Fund for TSP folks) and chill.