Why Military Spouses Should Get Ready for Retirement, Too

A recent study by the Transamerica Center for Retirement Studies highlights some sobering facts about women and retirement.  While women generally live longer than men, the average woman only has $34,000 in retirement savings, and most women don't have a backup plan for retirement. 

Only 10% of women feel confident about retirement. Add this to the fact that the unemployment rate for military spouses, the majority of whom are women, is at least 4x higher than the national average, so military spouses in their prime working years are contributing less to their retirement than their civilian counterparts.

Another issue is that many military spouses do not realize that retired pay stops when a servicemember dies unless the military member opted to pay for the Survivor Benefit Plan.  And even if a servicemember opted to pay premiums for the highest level of benefits for the SBP, the widow/widower will only receive 55% of retired base pay.

So what can military spouses do to ensure that they, like their active duty spouses, are moving in the right direction for retirement?

Save At Work

For those spouses who do work, they should try to contribute to an employer-sponsored pension plan if they are eligible for it.  Even if the active duty member is saving through the Thrift Savings Plan, the working military spouse should have retirement savings in his or her own right, especially if there is an employer match on contributions.

Save as an Individual

Non-working military spouses are eligible to set up Individual Retirement Accounts in their own names, even if they do not have earned income.  This can be a great way for stay at home spouses to start accumulating retirement savings.  Spouses can contribute to either a ROTH or a Traditional IRA (servicemembers may also be eligible to contribute to either type of IRA, even if they contribute to the TSP).

Key to Successful Retirement Saving

Whether a military family is saving for an emergency or saving for retirement, the key to success lies in making automatic contributions.  Even if a family can only afford to put $25 per month into a spousal IRA, it is a start.  Contributions can always be increased at a later time.  Even if an IRA cannot be fully funded each year, it is well worth it to have some sort of retirement savings vehicle in place.

Want help saving for retirement or reaching other savings goals? Take the Military Saves Pledge today and receive motivational emails, tips, and other resources so you can start building wealth and reducing debt!

by Lila Quintiliani, AFC®
Military Saves Program Manager

*This is a revised version of an earlier article that was originally published in May 2013

Tip of the Day

  • Written by Guest Blogger | May 14, 2014

    Pay more than the minimum due on your #credit card & pay off your bill sooner. More tips at http://ow.ly/wOaVh.

Saver Stories View all »

When You Start Small, Saving is Easy

Written by Lila Quintiliani | August 12, 2019

When Attiyya first got married, she and her Marine husband had just graduated from college and were focused on paying off student loan debt. They had both attended private schools and had sizeable loans. Then three months after the wedding, the couple found out they were pregnant with their first child.

The first year of their marriage, says Attiyya, was a balancing act between paying down debt and saving for the future.

Read more...

Making Saving Automatic Leads to Personal Success

Written by Lila Quintiliani | May 27, 2020

Ryan’s savings journey started when he was an active duty airman. Frequent deployments and temporary duty assignments gave him the opportunity to save. By the time he transitioned out of active duty, he had built up a healthy rainy-day fund and had started to aggressively save for retirement.

Read more...

Living the Dream: This Military Couple Retired Early

Written by Jackie Toops | March 18, 2021

“Continuous dedication to financial peace pays off,” shares military couple, Denise and Jim. They would know, because at ages 52 and 53, they are already retired. The couple enjoyed life as an Army family for 32 and a half years and started planning for retirement decades ago. Denise shares, “We are not working a paid job, but are volunteering and meeting some personal fitness goals and enjoying some time together after many years spent geographically apart. It can be done!”

Read more...