Military FIRE: Early Retirement Calculator for Service Members

A service member who enlists at 18 and reaches 20 years can retire at 38. An officer commissioned at 22 hits 20 years at 42. Both walk out the door with something most FIRE practitioners spend decades trying to build: a pension check that arrives every month, and Tricare health coverage worth $8,000–$15,000/yr in forgone insurance premiums.

The FIRE math for military retirees looks nothing like the standard model. You don't need a portfolio to cover 100% of spending from day one — you need a portfolio to cover the gap between your pension and your spending. And healthcare, the single largest wildcard in most early retirement plans, is already solved.

Two military FIRE advantages civilians don't have: (1) A pension that starts at separation — no waiting until 59½, no sequence-of-returns risk on that income slice. (2) Tricare coverage at $462.96/yr individual vs $8,000–$15,000/yr unsubsidized ACA marketplace.¹ Both reduce the portfolio size you need to achieve financial independence.

Military FIRE Calculator

Enter your situation. The calculator shows your annual pension under BRS or Legacy High-3, the FI gap your portfolio must cover, how much SEPP income your TSP can generate before 59½, and your MAGI check against the 2026 ACA subsidy cliff (relevant if you have family members not covered by Tricare or leave service with Reserve Tricare gaps).

BRS vs. Legacy High-3: Know which pension you have

There are two pension systems for active-duty service members. Which one applies to you depends on your entry date.

Factor	Legacy High-3	Blended Retirement System (BRS)
Who has it	Entered service before Jan 1, 2018 and did not opt into BRS	Entered service Jan 1, 2018 or later (mandatory); or opted in during 2018–2019 window
Pension formula	2.5% × YOS × high-3 average base pay	2.0% × YOS × high-3 average base pay
At 20 years	50% of base pay	40% of base pay
At 30 years	75% of base pay	60% of base pay
DoD TSP matching	None	1% automatic + up to 4% matching (5% max)
COLA	Full CPI COLA annually	Full CPI COLA annually
Continuation Pay	No	Lump-sum payment at ~8–12 years (must remain at least 3 more years)

BRS vs Legacy: who comes out ahead? Legacy gives 25% more pension income at any years-of-service level. BRS compensates with DoD TSP matching — over a 20-year career, 5% matching on base pay compounds significantly. At a $72,000/yr base pay, 5% matching = $3,600/yr invested for 20 years. At 7% real return, that's roughly $150,000 in additional TSP at separation. Whether that offsets the $14,400/yr pension reduction at $72K base depends on your assumptions — but for early separators or those pursuing Coast FIRE during service, the TSP match can matter more than the higher pension multiplier.²

Healthcare: the largest early retirement variable — already solved

Healthcare before Medicare is the most expensive and unpredictable variable in most early retirement plans. Unsubsidized ACA premiums for a 45-year-old run $8,000–$12,000/yr for an individual. For a 55-year-old, they reach $13,000–$16,000/yr. A family of four at the ACA cliff can see $25,000–$35,000/yr in premiums before out-of-pocket maximums.

Military retirees with 20+ years of service are exempt from this problem. Tricare Prime for retired service members under 65 costs $462.96/yr for individual coverage — that's $38.58/month.¹ Family coverage (retirees under 65) costs $927/yr in 2026. Primary care visits carry a $26 copay; most specialist visits are $35.

Coverage	Annual cost (2026)	vs. unsubsidized ACA at 45
Tricare Prime — individual retiree	$462.96/yr	~$8,000–$12,000/yr cheaper
Tricare Prime — family retiree	$927/yr	~$20,000–$30,000/yr cheaper
Tricare Select — individual	Lower deductible, slightly higher OOP	Similar savings vs ACA
Tricare for Life (age 65+)	Wraps Medicare; no additional premium	Eliminates Medigap/Advantage cost

The $8,000–$15,000/yr premium difference is a permanent reduction in your effective FI number. At a 3.5% SWR, every $10,000/yr in spending reduction corresponds to a $285,000 reduction in required portfolio. Military healthcare is worth $200,000–$400,000 in FIRE capital equivalence for a 40-year retirement horizon.¹

At 65, Tricare for Life wraps Medicare as a secondary payer — military retirees pay only Medicare Part B premiums and face no additional Tricare premium. The healthcare advantage extends through the entire retirement.

TSP early access: the one challenge military FIRE has that civilians with pensions don't

The Thrift Savings Plan follows the same federal early withdrawal rules as a 401(k). The Rule of 55 (IRC § 72(t)(2)(A)(v)) applies to TSP distributions if you separate from federal service in or after the calendar year you turn 55. For a service member who retires from active duty at 38–45, this exception does not apply — the separation happened years before 55.

The options for pre-59½ TSP access when separating before age 55:

72(t) SEPP (Substantially Equal Periodic Payments): Fixed annual payment from TSP for the longer of 5 years or until age 59½. At age 42, that's a 17.5-year commitment. Correct sizing is critical — stopping or modifying the payment before the commitment period ends triggers retroactive 10% penalties on all prior distributions plus interest. See the SEPP calculator →
Federal civilian service path: Some military retirees transition to a federal civilian job (FERS). If they separate from that civilian federal job in or after the calendar year they turn 55, their TSP — which includes the military contributions — qualifies for Rule of 55. This effectively unlocks penalty-free TSP access from a later civilian separation even if the original military separation was at age 40.
Public safety employees (age 50): Law enforcement officers, firefighters, and air traffic controllers who separated from federal service qualify for penalty-free TSP distributions at age 50 under IRC § 72(t)(10). This covers some military occupational specialties that transition to federal civilian public safety roles, but not standard military retirement.
Wait until 59½: Often the right call. If pension + VA disability already cover basic spending, there's no reason to start SEPP and commit to a rigid payment schedule. Let the TSP compound until 59½ when full flexibility opens.

Why SEPP is less urgent for military retirees than for civilian early retirees: Civilian FIRE practitioners without a pension must access all their spending from tax-advantaged accounts — SEPP is load-bearing. Military retirees who pension covers 40–70% of spending may not need TSP income at all before 59½, particularly if the taxable brokerage and Roth ladder cover the gap. The SEPP decision should be made with a complete picture of all income sources.

VA disability income: tax-free, off-MAGI

Many veterans receive monthly VA disability compensation based on a 0%–100% disability rating. This income is tax-free at the federal level and is not included in adjusted gross income — it does not count toward ACA MAGI, IRMAA thresholds, or the ordinary income tax calculation.

The Social Security Fairness Act of January 2025 repealed the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO), which previously reduced Social Security benefits for some government pension recipients. Veterans with a military pension and VA disability income are no longer penalized under either provision.⁴

At a 100% disability rating (combined evaluation), the 2026 monthly rate for a single veteran is approximately $3,900–$4,100/month (rates set annually via COLA). Concurrent Retirement and Disability Pay (CRDP) allows eligible retirees to receive full retirement pay and VA disability compensation simultaneously — the older VA waiver requirement eliminated for most retirees since 2014.

Social Security and military service

Military pay has been covered by Social Security since 1957. Every year of active duty service counts toward SS work credits and the 35-year earnings record used to compute your Primary Insurance Amount. Uniformed services special wage credits (up to $1,200/yr for service before 2002) were phased out but base pay has counted directly for SS since then.

A 42-year-old with 20 years of service has 20 years of SS credits. The zero-earnings years from separation to claiming age (at minimum 20 years until age 62) will average into the benefit calculation, reducing the benefit compared to someone who works until 60. The Social Security timing guide includes a zero-earnings penalty table showing the impact of 5–15 zero years on benefit estimates.

MAGI, Roth conversions, and the IRMAA window

Military pension income is ordinary income and counts fully toward MAGI. This creates several planning considerations:

ACA subsidy management: If pension income exceeds the 2026 ACA 400% FPL cliff of approximately $63,840 for a single person, ACA subsidies are unavailable regardless of other strategies. Since most military retirees have Tricare, this is primarily relevant in edge cases: reserve retirees with gaps in Tricare eligibility, family members without Tricare coverage, or the period between separation and retirement-benefit activation.
Roth conversion window: The years between separation and the start of Social Security (age 62–70) and RMDs (age 73–75 under SECURE 2.0) are the opportunity window for Roth conversions from TSP traditional and IRA accounts. Pension income occupies part of the lower brackets, but significant headroom often remains. The 2026 12% bracket top is $50,400 TI (single) / $100,800 (MFJ) — pension income of $28,000–$36,000 leaves meaningful room for conversions at 10–12% rates. See the Roth conversion ladder guide →
IRMAA lookback at 63–64: Medicare Part B premiums at 65 are set using income from two years prior. High-income Roth conversion years at 63–64 feed directly into 2026 IRMAA surcharges. The tier-1 threshold is $109,000 single / $218,000 MFJ.³ This is less urgent than for civilian FIRE practitioners with no pension floor, but still worth tracking if you plan large conversions in those years.

Survivor Benefit Plan (SBP): the military FIRE annuity decision

At separation, military retirees with eligible dependents must decide whether to enroll in SBP — a government-subsidized survivor annuity. SBP costs 6.5% of the gross retirement pay covered (you can cover less than 100% of your pension). In return, a surviving spouse receives 55% of the covered amount for life, indexed to COLA, if you die first.

For early retirees in their 40s who are married, SBP competes with a life insurance policy as a survivor protection tool. Key comparisons:

SBP advantages: COLA-adjusted for life (no policy limits), backed by the U.S. government, no medical underwriting, provides income if you die early in retirement (term insurance expires).
SBP considerations: Premiums paid for 30+ years if spouse survives; paid from gross pension (reduces take-home); if spouse predeceases you, you lose all premiums paid; lump-sum term policy may be cheaper for the first 20 years if your portfolio will grow to self-insure.
The 10/36 termination window: You can cancel SBP after 2 years of enrollment if you're at least age 70 and have been enrolled for at least 360 months (30 years) — a long horizon that typically doesn't apply to early retirees. Most decisions are effectively permanent at enrollment.

At a 40-year retirement horizon starting at age 42, SBP enrollment is often the right call for married military retirees — the COLA-adjusted income floor for a spouse outliving you is worth more than a term policy that expires in 20 years when you're 62. Model the specific amounts before the 1-year enrollment deadline following separation.

Military FIRE timeline

Phase	Age (20-yr example)	Key actions
Final 5 years of service	37–42	Max TSP contributions ($24,500/yr + BRS matching); build taxable brokerage for pre-59½ flexibility; model SBP decision; start Roth conversions if income allows; confirm Tricare enrollment upon retirement
Separation	42	Pension begins immediately; Tricare active as retiree; decide SEPP vs. let TSP grow; SBP election (1-year window); VA disability claim if applicable; do NOT roll TSP to IRA if SEPP or future Rule of 55 path (federal civilian) is planned
Pre-59½ period	42–59½	Live on pension + VA + taxable brokerage + Roth contributions; SEPP from TSP only if pension gap requires it; Roth conversions sized to bracket headroom; manage MAGI vs. ACA cliff for non-Tricare family members; let TSP compound if not needed
59½ unlock	59½	Full TSP and IRA access — no more restrictions; roll TSP to IRA if desired for investment flexibility; accelerate Roth conversions before RMDs and SS; IRMAA lookback window at 63–64
SS decision window	62–70	Pension already covers base income; SS is incremental. Delay to 70 maximizes longevity hedge (124% of FRA vs 70% at 62).⁴ With pension as income floor, delaying SS is usually optimal.
Medicare + Tricare for Life	65	Enroll in Medicare Part A + B; Tricare becomes secondary payer (Tricare for Life) — no additional premium; most medical costs covered by the combination.

Where the plan can break for military FIRE

Rolling TSP to IRA immediately at separation. A newly separated 42-year-old who rolls TSP to an IRA on the way out loses the future ability to use Rule of 55 from a later federal civilian separation at age 55. The IRA doesn't qualify; the former TSP funds now in the IRA don't requalify. If any federal civilian employment after military retirement is possible, keep TSP in TSP until the decision is clear.
SEPP modification before 59½. Starting a SEPP and then changing the amount — for any reason — triggers retroactive 10% penalties plus interest on every prior distribution from the date the SEPP started. If you start a SEPP at 42, that's potentially 17+ years of distributions subject to penalties if you modify it. Size it correctly the first time.
SBP non-enrollment if married. The default enrollment window is 1 year after retirement. Missing it and having no alternative life insurance could leave a surviving spouse with pension income that ends at your death. SBP or a large permanent policy should be evaluated before the enrollment deadline passes.
IRMAA at 63–64 from over-converting. The Roth conversion window from 42–63 is long and valuable, but aggressive conversions in years 63–64 specifically can add $2,000–$12,000/yr in Medicare Part B surcharges starting at 65. Plan the final two years before Medicare enrollment carefully.

Working with a fee-only advisor on a military FIRE plan

Military FIRE planning has specialized elements that many generalist advisors haven't modeled: the pension coordination with withdrawal order, the SEPP timing decision against the pension income floor, SBP vs. life insurance, CRDP eligibility, and Roth conversion sizing across a 20-year window before Social Security and RMDs begin. A fee-only advisor who understands military benefits — not just civilian FIRE — will run the SEPP, SBP, and conversion scenarios with the pension as a fixed input, rather than treating the plan like a standard accumulation-phase problem.

Get matched with a fee-only early retirement specialist

Vetted, fee-only advisors who specialize in early retirement planning — including military FIRE scenarios with pension, TSP, and VA disability coordination.

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TRICARE Prime Enrollment Fees — tricare.mil — 2026 annual enrollment fee: $462.96/yr individual (Group B retirees under 65), $927/yr family; $26 primary care copay. Updated January 1, 2026.
DoD Blended Retirement System Overview — militarypay.defense.gov — BRS pension formula (2.0% × YOS × high-3), DoD TSP matching (1% automatic + up to 4% match), BRS mandatory for post-Jan 2018 entrants.
SSA: Medicare Part B Costs and IRMAA — ssa.gov — 2026 IRMAA tier-1 threshold: $109,000 single / $218,000 MFJ (2-year lookback from Part B enrollment year).
SSA: Effect of Early Retirement on Benefits — ssa.gov — FRA = 67 for born 1960+; claim at 62 = 70% of FRA; delay to 70 = 124% of FRA. WEP and GPO repealed January 2025 (Social Security Fairness Act).
IRS: 72(t) SEPP FAQs — irs.gov — IRS Notice 2022-6: 5% maximum interest rate for fixed amortization and fixed annuitization methods. Commitment period: longer of 5 years or until age 59½.

Safe withdrawal rate research: Bengen (1994), Blanchett/Pfau/Finke (2013), Big ERN Safe Withdrawal Rate Series. IRS Pub 590-B Table I (2022+ revision): life expectancy factors for SEPP calculations. Values verified June 2026.