White Belt's Military Journey to FI

Where are you and where are you going?
white belt
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Re: White Belt's Military Journey to FI

Post by white belt » Sat Feb 02, 2019 10:54 pm

Thoughts on Maximizing Military Income

As I stated above, my base pay is set by the DOD based on my rank and time in service. I have no way to increase this pay. I am also paid two allowances that are tax free: BAH (basic allowance for housing) and BAS (basic allowance for food). BAH is based on zip code and BAS is also tied to rank and time in service. Not that these allowances are paid every month irrespective of what I spend on housing or food, so I can keep any profit that I don’t spend on these expenses. I will primarily focus on BAH, as I’ve determined that there are ways to optimize this.

I’ve found that BAH in high cost areas is much more profitable than in low cost areas. For example, at my current duty station I am spending $350 a month on my room in a 4/2 house with 2 roommates and my BAH is $1300 a month, which means each month I pocket $950 ($11.4k annually). Not bad right?

But let’s say I live in an area with a lot higher BAH, like the DC metro area or Hawaii. In bases around the DC area, I might earn $2.2k in BAH and in Hawaii I’d get $3k in BAH. If I try to find a similar living situation of my own bedroom in a house/apartment shared with 2 other people, I use the conservative figure of $700 monthly rent (Craigslist perusing shows I could even find $600). In DC area I would pocket $1457 monthly ($17.4k annually) and in Hawaii I’d pocket $2279 monthly ($27.3k annually). Again, this allowance is tax free, which means I pocket 100% of those totals.

In summary, if I want to maximize my income at my next duty station, I should try to go to a high cost of living area. Note that I didn’t include the $6516 yearly I’d get in Hawaii for COLA because I’m assuming that this will actually cover more expensive food and gas, though it’s possible I would pocket some of this as well.

Now certainly there are ways to maximize bonus pay, official travel, and deployments to make more money. However, I’m not going to discuss them because the key point is that I get BAH no matter what (e.g.: even if I’m deployed for 9 months in a foreign country, I am still paid BAH for my home station). Other bonuses are just a sweetener. Additionally, maximizing BAH doesn’t require me to be away from home like traveling or a deployment.

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Re: White Belt's Military Journey to FI

Post by Kriegsspiel » Sun Feb 03, 2019 7:51 am

IIRC, when I was posted OCONUS, my BAH was matched to my rent through the housing office, so there was no way to pocket the leftovers. HI is OCONUS, but I'm not sure if it would be the same as a non-US post, have you confirmed which way it operates?

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Re: White Belt's Military Journey to FI

Post by Bro » Sun Feb 03, 2019 8:44 am

Have you looked at picking up any part time work on the side?

white belt
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Re: White Belt's Military Journey to FI

Post by white belt » Sun Feb 03, 2019 12:57 pm


Service members in Alaska and Hawaii still receive BAH, even though it is OCONUS. In other locations like Europe or Asia, they receive Overseas Housing Allowance (OHA), which is only paid up to what is actually spent on rent. Therefore, this strategy would not work in those locations (although in parts of Europe I could get $10k a year in COLA).

Since the privatization of military housing in many locations, some on-post housing charges a flat rent that I pay with a check instead of collecting all BAH directly from my paycheck (my current post is an example). From the looks of it, most posts on Hawaii still collect BAH in it's entirety, which means I would have to live off post in order to pocket the leftovers.


I haven't really. Although I'm currently working an office schedule, my job can be pretty demanding which would make it hard to maintain any sort of consistent part time work. Additionally, the only free time I really have for other work is on the weekend and maybe 7PM to 9PM on weekdays. That time on weekdays is my relaxation time and on weekends is when I socialize, go on dates, cook for the week, run errands, etc. Furthermore, I've only ever had one W2 job in my life that wasn't the Army and that was 7 years ago. I'm not so sure how to translate my skills into a part time job.

Some kind of freelance or virtual work might be possible, so I'll look into that. I've made money selling some of my possessions while de-cluttering, but that's not sustainable over the long run because my supply will eventually run out. That reminds me I have a few more things to list on Ebay.

Some of my hobbies could lead to income down the road, but right now I'm not at a level to make any money from them. I will definitely need to figure out how to diversify my income streams in the long term, which means I need to refine the skills that could make me money. Right now the focus is mostly on skills that reduce expenses (which makes me money). This gives me a lot more bang for my buck until I get expenses down to maybe $1000 a month. Then I will focus more on developing side income. For those that are already at that level expenses or lower, is that the method that you used?

I am a little concerned that the more time I spend in the military lifestyle, the more I will turn into a salary man.

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Re: White Belt's Military Journey to FI

Post by Bro » Sun Feb 03, 2019 1:06 pm

Is there any chance the Army will send you to graduate school? If you get a graduate degree, you can try to adjunct at different educational institutions on post / near post.

white belt
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Re: White Belt's Military Journey to FI

Post by white belt » Sun Feb 03, 2019 5:53 pm


Certainly there are multiple options for me to pursue graduate study, however all of them incur significant service obligations (usually 3x the length I'm in school). Additionally, at this point in time graduate school doesn't fit into my web of goals, so I probably won't pursue that option.

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Re: White Belt's Military Journey to FI

Post by white belt » Sun Feb 10, 2019 7:29 pm

Career Thoughts

Over the past week I’ve really been thinking about what I want to do with my current career. I drew some timelines out with pen and paper which helped me to visualize things. Here is the current situation:

-I know I will be at my current position most likely until November 2020 (I might be able to shift that 6 months earlier, but I’m not sure at this time)
-After my current position, I will have to attend 6 months of training, which will incur a 12 month service obligation from when I finish the course
-This means, most likely the earliest I could leave AD is May 2022 (or November 2021 if I leave my current position 6 months earlier)

I don’t get full GI bill benefits until November 2022, which is part of my semi-retirement plan, so right now I am eyeing that date as my possible transition point. That is approximately 3.75 years away, although at this time I like my job enough that I’m not counting the days down.

Even though it’s only been a few months, living at a duty station that is located in an area with higher population density and more women has really improved my quality of life. Additionally, working a more regular schedule and having weekends off means I have time for life outside of work. Therefore, I believe living at a duty station that’s even closer to an urban center will bring me even more satisfaction.

As I alluded to in my last post, higher COL areas also provide a net pay raise thanks to housing allowance. After further research, I believe I am going to eliminate Hawaii and any other OCONUS location from possible locations because it would lock me in for a 3 year tour, which means I wouldn’t be able to leave AD until November 2023 at the earliest. I’d rather not lock myself in for longer service obligations if I can avoid it, since I’m 90% certain I won’t be doing the 20 year career path.

I’m currently exploring options in the greater DC metro area. I don’t know all of the options available but I have a coworker that’s senior to me and knows a good deal about what’s out there. Additionally, I have two coworkers that will be moving to units up in the DC area in the next 6 months, so hopefully I’ll able to leverage some connections if it gets to that point.

From the COL indexes I’ve looked at, the DC metro area is one of the most expensive in the country. However, my Craigslist and Google maps research reveal frugal options. The keys I’m finding are to live with roommates (duh), in an area that’s got a high population density but isn’t as expensive as DC proper (Baltimore, Arlington, Alexandria), in which I can commute by public transportation rather than car. The heavy traffic in the area means even a 10 mile car commute can take 45 minutes during rush hour (that’s a lot of money on gas and wear and tear). Also, the government will cover the cost for employees to use public transportation, which means my commuting costs could be free. I’m ok with up to an hour commute by public transportation because I can still use that time for reading/studying, whereas if I’m driving I have to be actively engaged. It might even be possible for me to get rid of my car, but for now I’d just plan on keeping it and only using it for weekend trips.

Ideal (Semi) Retirement

I ballpark at the time that I leave Active Duty in November ‘22, I will have around 300k in net worth. Of course some of this depends on the valuation of the stock market at that time as right now most of my net worth is in index funds. But 300k provides a good planning factor and really the exact number doesn’t matter much since I don’t plan on drawing from that pile more than ~5k to fund my first year of retirement. My NW is not sufficient for a lifetime at 2x JAFI expenses, but provides a cushion for my semi-retirement. Additionally, it gives me capital to possibly invest in rental properties or go with a house hacking strategy to lower expenses.

Right now, my 3 year plan starting in November 2022 is as follows:

Year 1:
NG/Reserves ($12-19k income per year)
Practice guitar to get into Masters program for Jazz
Research/learn about RE investing in area

Year 2:
NG/Reserves ($12-19k income per year)
Music School (GI Bill covers tuition and provides $19k a year for living expenses)
Purchase property?

Year 3:
NG/Reserves ($12-19k income per year)
Music School (GI Bill covers tuition and provides $19k a year for living expenses)
RE Income ($??)

With this plan, the only time I would potentially have to draw down from savings is the first year if my NG income does not quite cover my expenses. Once I am in school, I have the option to stop military service and just live off the generous GI Bill housing allowance, or still do both and maintain a 50% savings rate. Rental properties or house hacking could also provide cash flow.

I actually have 36 months of GI Bill benefits, which is enough for 4 years full time (no summers) in grad school. So I could try to find a program that I can stretch into 4 years of schooling and have my tuition covered and 19k as a living stipend (without having to TA) for that entire time, but I think I’d rather keep the last 18 months of benefits in my back pocket in case I decide to do another career change/return to academia later in life.

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Re: White Belt's Military Journey to FI

Post by Bro » Mon Feb 11, 2019 6:29 am

How did you decide against sticking it out until 20 years?

Did you switch to the Blended Retirement System last year?

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Re: White Belt's Military Journey to FI

Post by Kriegsspiel » Mon Feb 11, 2019 8:40 am

Excellent plan.

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Re: White Belt's Military Journey to FI

Post by Augustus » Mon Feb 11, 2019 11:43 pm

Good plan, only thing I wonder is the hourly rates you can get after music school? Are you planning to part time give music lessons or something? What's your end game in 20 years or whatever? I only ask to see if they all line up, if you'd need to retrain again later to ramp up income down the line for some bigger ambition, then you may want to do that first?

Being a semiRE musician sounds very fulfilling provided that you can get enough money for later in life plans.

white belt
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Re: White Belt's Military Journey to FI

Post by white belt » Wed Feb 13, 2019 10:51 pm


ERE gives me the option to reach financial independence long before working for 20 years to get a pension. I have some other interests that I’d like to really explore full-time (music is one) which I don’t think I will be able to do while having an active duty job. In my line of work, 20 years is a very long time and takes a serious toll on the mind and the body. I’ve seen enough physically and mentally broken service members just grinding their way through the last 5-10 years of their career that I don’t want to ever be in that position. Doug Nordman provides some good insight into this and even though he stuck it out for a 20 year career, he thinks leaving active duty before the 20 year mark and joining the reserves would have saved him a lot of stress. On the other hand, I do still enjoy my job and at the moment I’m really just taking things one assignment at a time.


Great questions.

I don’t really have an end game that I’ve thought through 20 years out. I have a hard time looking that far out because my desires change so often that I think trying to project forward specifics is a waste of time. However, I would like to be financially independent at some point, just because it provides me with some freedom and flexibility. Certainly my expenses could increase in the future, but I also believe that at some point I will return to full-time work between the age of 28 and my death. I’m not sure if you’re hinting at that maybe my expenses will increase because I’ll have a family one day. That is possible, however I don’t anticipate choosing a spendthrift partner and I’m not even sure that I want children.

My goal in my (semi) retirement is to not have to draw down any of my savings (principal or returns) for as long as possible. I will cover my expenses through streams of income while my net worth continues to grow from compound interest. I’ll admit that I haven’t yet run the numbers on what age I would reach financial independence if I never contribute another dollar to my net worth after a leave Active Duty.

I’m not sure if the typical cost/benefit analysis of a graduate degree is applicable here. The GI Bill will pay me 36 months of benefits, however if I don’t get a degree then I have no way to get that money (tuition and fees covered up to $24k a year and another ~$19k for living expenses). In other words, I will be getting paid to go to school, without having to do any of the slave labor associated with typical graduate stipends.

Before going into wages, I’ll go into my reasons for wanting to get a graduate degree in music. A music degree will tie me into the local community of musicians and improve my musicianship through focused study faster than I would be able to do on my own. The degree itself doesn’t matter that much, but the connections it provides me with is what I think will be one of the biggest factors to being able to find gigs as a musician. To clarify, the university I’d be studying at is in the same city where all of my friends and family live now, so it fits well into my web of goals.

I’m not so sure on hourly wages of a musician, however here are the options I’ve examined for making money from music:

Teaching Guitar (real hourly wage $30-50)
That wage range comes from having my own guitar teaching business rather than working for a school. Going rate in my city for lessons is $60 an hour if they travel to me or $75 an hour if I travel to them. Obviously, that would take work to develop a website and hunt for students, however I might be able to leverage a blog/personal website to teach skype lessons for $50-60 an hour. I would note that best case we’re talking about teaching 4 hours of lessons a week unless I want to spend all my time teaching rather than playing. That real hourly wage factors in travel time/expenses, prepping lessons, finding students, etc. But even with 16 hours of lessons a month, that could potentially provide me with $1000 of net income a month.

Cruise Ship Musician ($3k a month)
Pub guitarists/singers can make ~$3k a month working cruise ships which usually have contracts of 3-6 months. I would live on the cruise ship for that time, so all food expenses would be covered. I could see myself working 3-6 months a year on cruiseships and spending the rest of the time stateside until I get tired of that lifestyle.

Local Gigs ($??)
I really have no idea what the average wage for local gigs pay. Pay varies a lot depending on the gig, however I know of musicians that make a living just playing in cover bands or wedding bands. I suspect making money from original music is a bit more difficult.

Website/Blog/Youtube/Patreon ($??)
There are ways to make money as a musician online depending on what platforms that I want to try to monetize. My primary focus for this will be to do things I enjoy doing, rather than just trying to monetize things, so I don’t have this high on the list.

I suspect the ERE lifestyle will help me immensely when it comes to navigating the musician lifestyle. I’ll have low expenses and multiple streams of income, so I am not desperate for gigs and I don’t need to have an energy/time draining full-time job to support myself. I’ll also have a wide social network from all of my renaissance man interests and activities.

As I mentioned in earlier posts, other streams of income would be rental real estate and National Guard. My SHTF fulltime fallback option is to find a government or contracting job in IT, which with my experience should be possible even if I’ve been out of the job market for a few years. Drilling in the Guard would also help to keep my experience fresh and make me look more “employable.”

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Re: White Belt's Military Journey to FI

Post by Cheepnis » Fri Feb 15, 2019 7:45 pm

Greetings white belt, I have a degree in jazz performance, though I no longer play.

What sub-genre's of jazz are you into and who are your favorite guitarists?

A couple records I've been digging lately are "James Farm", "The Bad Plus Joshua Redman" and "Bags Meets Wes".

white belt
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Re: White Belt's Military Journey to FI

Post by white belt » Sat Feb 16, 2019 1:22 pm


I enjoy listening to and playing jazz, however I would say that the genres of music that speak to my soul most are probably more in the rock/blues/funk realms. I do really like gypsy jazz because I feel like it is a sub-genre in which the guitar has some of the raw energy that you also have with rock or blues. In terms of guitarists, I like John Scofield and Django Reinhardt. There are others, but I haven't been listening to a lot of jazz guitar music recently.

I see jazz as a great framework to really challenge and expand my musicianship, which will then carry over into other genres.

white belt
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Re: White Belt's Military Journey to FI

Post by white belt » Sat Feb 16, 2019 3:19 pm

First off, I hit a big milestone recently. I now have over $150k in net worth! It gave me a small thrill seeing that number, however at the end of the day it’s just a number on a screen. Although money does give me freedom and options, numbers on a screen don’t provide me with lasting fulfillment or self-actualization. Life goes on.


18k annual expenses (The numbers get a lot more favorable if I can lower my expenses, however I am using this conservative figure because it reflects my current expenses)

Traditional FIRE (33x annual expenses saved)
NW required: 600k
Projected FI date: 2025

This is the traditional FIRE situation in which I stay in the Army until I have enough money to have a 3% SWR for the rest of my life. I think I would have to stay in the Army around 10 years to reach that point, depending on market performance. I could then leave the Army and never have to work again, which I’m sure would be a great feeling. However, I don’t think I’ll end up sitting around for the next 50+ years of my life without earning another dollar. Additionally, this strategy isn’t very ERE because I’m accumulating all of my money by maximizing income from one specialized job and minimizing expenses. It’s more difficult to develop multiple streams of income and diverse ERE skills when I’m focused on working one full-time job.

Semi-Retirement/Crawling to FI (ERE)
NW at start of Semi-Retirement: 300k

Another option that I mentioned earlier in my journal is for me to leave the Army in 2022 with $300k NW (50% of FI). Fish’s post in the Coasting to FI thread helped to lay out the math behind this strategy. The data that pertains most to me is this (assumes 4% investment returns):

Savings Rate in Retirement/Years to 33x
0% - 23.4
10% - 20.2
20% - 17.2
30% - 14.5
40% - 12.0
50% - 9.7
60% - 7.5
70% - 5.5
80% - 3.5
90% - 1.7

In other words, if I leave the Army in 2022 and only work enough to cover my expenses in semi-retirement, it will take me 23.4 years to reach FI (2045). Compared to the traditional FIRE option, I’m getting semi-freedom 3 years earlier but will have to work to cover all my expenses for 23 more years. From a strictly numbers perspective, it of course makes sense to just stick out full-time employment for 3 more years and be set for life.

However, I really don’t care all that much about hitting my “number.” I think traditional FIRE is overrated and many of those who just focus on the number end up deeply unfulfilled in retirement until they develop other hobbies and streams of income. If I know I’m going to do that in retirement even with traditional FIRE, I might as well just do it sooner. Additionally, Jacob has pointed out in other threads that having more money than he ever could need has actually demotivated him from pursuing some opportunities that could have improved his life.

I think worst case for me is a 30% savings rate in semi-retirement, which would require a post-tax income of $25.7k a year. That would give me a FI date of 2036, not that the FI date really matters. I am certain some years I would surpass it and maybe some years I wouldn’t quite make the 30% savings rate. I think I’ll aspire to a 50% savings rate, but 30% is much more realistic.

Like everything related to FIRE, things get a lot easier if I can lower my expenses or if I use a less conservative SWR. My focus right now is on lowering expenses rather than developing other streams of income, but I wanted to run the numbers on a worst-case scenario.

white belt
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Re: White Belt's Military Journey to FI

Post by white belt » Mon Mar 04, 2019 7:11 pm

February Report

Expense Breakdown

Housing - 350
Insurance - 54
Cell Phone - 18
Internet - 23
Music – 9
Mail Box - 20

Groceries – 280
Dating – 108
Restaurants – 72
Shopping/other - 88
Alcohol - 8
Gas/Travel – 56

Total: 1086

Spending was quite low this month, although part of that is because I traveled a week for work and February is shorter than other months.

Business Trip
I’m not sure the best way to account for my expenses while on a business trip, since all my non-food expenses are covered and I get per diem each day. For my 5-day trip I received $248.50 in per diem and I ended up spending $102.66 on food, which left me with a $145.84 profit. I guess in the future I could still count the food expenses while traveling in order to motivate me to figure out how to lower them. This was my first business trip with my unit and nearly every meal was a social/business meal with a group of people, which means lowering food expenses might not really be possible. I think I only had one beer the whole trip, in part because it was during the workweek.

I’d be curious to see how other people account for per diem business expenses. Even if I don’t account for them in expenses, my monthly food spending will be artificially lower since I don’t have to spend money on food during the time I’m traveling. On the other hand, I wouldn’t be spending money eating out at restaurants if I wasn’t traveling.

A big expense that I didn’t include this month is $800 for federal taxes. I will get a $1500 refund for state taxes this year, so I see the whole tax situation as a wash. Again, another accounting choice to keep things simple, although technically I could count the tax bill as an expense (amortized over the entire year) and the refund as income. I will get that refund every year from state taxes because I can’t get them to stop deducting it from my paycheck.

I have another month-long trip coming up, so expenses should be pretty low for March and April.

Travel Credit Cards
Chase and American Express wave all annual fees for active duty military personnel. In the past week I’ve upgraded to 2 cards that give me $300 reimbursement for travel expenses and $200 reimbursement for airfare expenses respectively. Other benefits include $200 a year towards Uber and a free hotel night annually. In combination with my points from work trips, this should allow me to travel several times a year without having to increase my expenses at all. In other words, I can increase my quality of life by visiting friends and family more often without having to increase my spending.

Revisiting Earlier Journal Posts
I re-read my first few entries in this journal and I think my expenses at that time were closer to 2.5k a month rather than the 1k that I estimated. When I started this journal, I wasn’t tracking every expense and it seems like I spent a lot of money on eating out. I don’t think I’ve ever had expenses this low, which is mostly because I got my rent down to $350 a month and I’ve made a deliberate effort over the past couple of months to cook more. Also living in a place that has a higher population density means that I don’t have to drive hours and stay in hotels/Airbnbs on weekends.

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Re: White Belt's Military Journey to FI

Post by white belt » Mon Apr 22, 2019 5:17 pm

April Update

I just returned from my whirlwind month-long work trip. I'm still tabulating expenses and income for March and April, so I'll probably include those in a complete financial update at the end of the month.

The trip was my first to the West Coast and I really enjoyed it. I spent a week in San Diego and now I see the appeal of Southern California. It was one of the nicest cities I've ever been and I think it would be a very good retirement spot. I'll go into details in a moment. I also spend some time in Washington, which was also nice but I wasn't as big of a fan of the weather and culture compared to SoCal. I'm glad to be back sleeping in my own bed and be able to cook my own meals. I grew tired of living in hotels and eating meals out.

Before going to California, I assumed the state was car congested, overpriced, overtaxed, and overrated dystopia. Although there are probably parts of CA that fit that criteria, I found San Diego really appealing for me. I enjoyed the sunny weather which encourages people to spend more time outside and makes activities enjoyable year round. Cycling is very popular (Bronze Bicycle Friendly Community). I liked the easy access to beaches and was shocked how dense the city is (downtown to the beach is a 15-20 min car ride or 30 min bus ride). Traffic is bad at rush hour, but that's true of every city I've seen and honestly the Seattle traffic was worse than what I saw in San Diego. The public parks and beaches are beautiful and I was thrilled to see the number of people just hanging out on the beach with their friends on a Friday night, sitting around a fire, grilling, enjoying the sunset, and having a good time all free of charge.

And my god the girls. Going from my base in the small town south to San Diego was like going from a desert to tropical rain forest. It's a great mating market for what I'm looking for at the moment. I thought the girls I would come across might be stuck up or money-focused, but really I found many to be physically active, laidback, and down to earth. It's not LA.

There are of course downsides to the city, but I think a lot of those could be mitigated in a semi or full-retirement. Housing cost is high, although pretty comparable to major cities outside of the south. I think it's Ego who lives in SD and has some kind of property management situation, so undoubtedly there are ways to mitigate the high housing cost. It's my understanding that CA offers a lot of public services, which is helpful to an individual with low expenses and low income, and high taxes are not as big of an issue if I'm out of my major accumulation phase. Additionally, as Jacob and others have said about California, there is plenty of opportunity to live off the waste/excess of others through scavenging, etc. A car is not necessary if one chooses housing wisely and public transportation seems decent.

For me the biggest downside is the distance from friends and family on the east coast. I don't know that I'd permanently move there, but I could see maybe living there seasonally a few months out of the year.

Maybe I have an overly positive view of San Diego, but I'd love to get any opinions of people that are familiar with the city.

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