PoF Blog Post – Financial Implications of Leaving a Military Medicine Position

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One of my readers pointed me to this blog post on Physician on Fire, which many of you will find interesting:

Financial Implications of Leaving a Military Medicine Position

If you’d like my own thoughts on the value of a military pension, you can read them here:

How Valuable is a Military Pension?

6 thoughts on “PoF Blog Post – Financial Implications of Leaving a Military Medicine Position

    Adrian said:
    November 14, 2017 at 21:46


    Great article (and ensuing discussion) on the financial implications of leaving the Service. While the decision isn’t primarily a financial one, it’s important to have a clear view of the financial costs.

    What’s rarely discussed, however, is the financial risk/benefit of staying past 20 years of service. In my estimation, staying beyond 20 years doesn’t seem to make much financial sense. If you have other career goals and desires (OIC, XO, CO, etc) then it makes sense, but it certainly doesn’t pay to do so.

    I’m curious to know your thoughts on the financial implications of going past 20 — let’s say maybe 30 years.

    I have the great fortune of 7 years prior enlisted time, and will be eligible to retire as of 1 Feb 2019, but I also recently selected for O5, and slated to pin on in May of 2018. However, I’m strongly considering declining the promotion in order to retire, because after comparing the financial implications of either choice, it makes the most sense to retire and claim the pension. That said, I worked tremendously hard for that promotion (underwent 9 months of misery in CENTCOM for it), and this I’m not sure I want to thumb my nose at the opportunity.

    Sorry for the longwinded nature of my question, but in short, is staying past 20 a wise financial decision? Or would it be merely vanity because I like the look of “scrambled eggs” on my cover?


      Joel Schofer, MD, MBA, CPE responded:
      November 15, 2017 at 06:21

      Oh boy…this is a complicated issue. What is your specialty? How long do you intend to practice it? How much money do you already have? How much money do you want? Do you like the military? etc.

      If you answer some of these questions, like what specialty you intend to apply for and how long you want to work clinically, I could perhaps do a basic analysis and calculate the present value of the two future income streams.


        Adrian Elliott MD said:
        November 15, 2017 at 22:02

        Sorry…I should have been a bit more clear. I’m a board certified anesthesiologist. In practice for some 6 years now. I just transferred to NMCSD.

        I now have a little over $700K saved, with a goal in mind of $4.5M by age 66 — I’m now 45. I routinely put away $60K per year — TSP, IRAs, and taxable accounts combined. I max out my CZTE when I deploy. I expect to continue practicing for at least the next 21 years. I enjoy the military, but it does trouble me at times that I have to sacrifice time spent in clinical practice in order to promote. Nothing new there.


        Joel Schofer, MD, MBA, CPE responded:
        November 16, 2017 at 07:21

        If I was you, I’d just go to this calculator and play with the different scenarios:


        You can put in the value of a pension. You just have to translate your desire for $4.5 million into a desired annual income, which frankly is more relevant. If you are using the 4% rule, $4.5 million translates to $180,000/year.

        I’m sure you realize this, but as an anesthesiologist you can really do whatever you want. Either way you’ll be set up perfectly to hit your target as long as you are disciplined about saving/investing. A 30 year O6 pension is basically $100,000/year, that that would leave you with only $80,000/year of income to make up to hit 4% of your $4.5 million target.


    Adrian Elliott MD said:
    November 18, 2017 at 06:35

    Thanks Joel. I’ll check it out and plug in the data from a couple of different retirement scenarios. I’ll put the resulting analysis in a spreadsheet and send to you to look over. Maybe others who have a similar question in the future might find it helpful, as this question does come up quite often. There isn’t necessarily a right answer, but claiming your military retirement check a bit earlier does have great value. The question is: does the monetary value of that retirement check outweigh the security of a continued career, for all its drawbacks (deployments, isolated duty stations, repeated moves)?


      Joel Schofer, MD, MBA, CPE responded:
      November 18, 2017 at 10:17

      We could easily calculate a net present value for multiple scenarios on Excel. Frankly, though, there are so many useful and high quality calculators out there (like the Vanguard one) that you can get an 80-90% solution without having to do all that extra work.

      No matter which way you go, you’ll be fine financially, so it is probably more of a life decision than a financial one.


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