Your financial assessment

Understanding your financial picture during transition is critical to your success

Steps to prepare financially

To get started on the right path to transitioning to a new career, your finances have to be in order. Knowing what you spend and save will help you determine how much salary you’ll eventually need.

A woman reviewing her finances in her kitchen with her two sons in the background

Step 1: Create a budget/spending plan

This budget should consist of what you spend now. This will give you a realistic picture of what you spend every month and where you can make changes if necessary.

To get started visit the Create your own spending plan in the Spending Smart topic. It will be helpful to complete this before you can move on to Step 2.

Once you’ve created your budget or spending plan, try to estimate how much money you’ll need to earn from a new job and a general idea of how much money you’ll have on hand while you’re looking for a new job.

Step 2: Identify the cash you have (or will have)

To begin this process, think about or even write down:

  • The amount of savings you have now
  • The amount you expect to save before you leave the military
  • The amount of your last paycheck
  • The amount of leave you will cash in
  • The amount of money you expect to receive from selling a house, a car, or other personal items

Step 3: Figure out the cash you’ll use

Next, create a list of your expenses you’ll pay as you begin looking for that new career.

Ask yourself:

  • Will you take any money from savings to pay off debt?
  • Will you need to move?
  • How much money will you pay for moving costs?
  • How much money will you need to secure housing (down payment, closing costs, and first and last month’s rent)?

Finally, compare the two lists to see if there’s a shortage or an overage. This will help you figure out if you can look for a job without earning any additional income, or if you’ll need to find full or part time temporary work while looking for your next position.

Click Next to learn about military to civilian pay considerations.