Wednesday, 05 March 2025 Issue#021

Welcome to March Madness—only this version has nothing to do with basketball. Transitioning out of the military is often described as organized chaos, and the best way to bring order to it is by staying informed. That’s exactly what we aim to do each week. This time, we’re tackling three big topics: the housing market, the job market, and everyone’s favorite—taxes. Let’s dive in!

Housing Market

It's no surprise that where to live post service remains one of the toughest and most stressful decisions to make. If you are thinking of buying, attempting to time the market and align it with your transition often fails. Changing benefits, interest rates, and loan programs make your head spin. The best thing you can do is to keep tabs on the metrics that matter. Not to time a decision, but to know what your getting into. In my opinion, one of the best tea leaves to read is inventory rates. Particularly, inventory rates in one most popular post military states, Florida.

Florida's housing market is finally cooling down after a sizzling pandemic-fueled boom, but it's not a buyer's paradise...yet! With a record 172,209 homes available for sale in January, the Sunshine State is witnessing a 22.7% increase from last year, marking the highest inventory since 2012. This surge is partly due to Florida's construction frenzy, which has outpaced most states, and partly because condo owners are bailing due to new safety regulations and skyrocketing insurance costs. As a result, buyers now have more options and bargaining power, though they might still face historically high prices and mortgage rates lingering around 7%. The market is shifting, and some areas might see price drops by year-end, making it more palatable for those looking to snag a Florida dream home.

How DOGE Cuts Could Impact The Future Job Market

Hold onto your government-issued hats, folks! Regardless of your stance on the DOGE cuts to the federal workforce, the federal job market is about to experience a seismic shift that would make even the most stoic bureaucrat break a sweat. With over 300,000 federal workers facing the chopping block, Uncle Sam's workforce is slimming down faster than a politician's promises during election season. This mass exodus is set to flood the job market with a tidal wave of highly skilled, security-cleared professionals, creating a double-edged sword for the economy. On one hand, private sector employers are salivating at the prospect of snagging top talent with insider knowledge of government operations. On the other, this influx of job seekers could turn the current job hunt into a cutthroat competition that makes The Hunger Games look like a friendly game of musical chairs. So, transitioning service members, polish those resumes and sharpen those networking skills – you're about to enter a job market that's more unpredictable than a game of Monopoly with your in-laws.

Navigating the Tax Maze: A Retiree’s Guide to Military Retirement

Ah, taxes - the uninvited guest that crashes your retirement party. Here’s quick roadmap to the tax terrain you’ll encounter after hanging up your uniform.

The Taxman Cometh: Farewell to Tax-Free Bliss

Remember those glorious tax-free allowances? Wave goodbye as you sail into retirement. For most, your post-military income will need a boost to maintain your lifestyle. That sweet BAH? Poof, and the extra income you make to account for that loss now taxable, so you’ll need more greenbacks to keep the same roof over your head.

Pro Tip: Use the DoD’s RMC calculator to figure out your new magic number. It’s like a crystal ball for your wallet!

Income Streams and Tax Brackets: A New Financial Tango

Congratulations! You’ve gone from one paycheck to a financial ménage à trois: retirement pay, civilian wages, and possibly VA benefits. While VA disability payments remain your tax-free BFF, military retirement pay is now fair game for Uncle Sam.

Warning: Combining incomes might catapult you into a higher tax bracket. It’s like leveling up in a game, but with more paperwork.

Withholding Wizardry: Avoiding the Tax-Time Surprise

Nobody likes an April 15th shocker. Use the IRS Tax Withholding Estimator to ensure you’re not caught with your financial pants down. You might need to increase withholdings from both paychecks, or go all-in on one. Choose your own adventure!

State Taxes: The Geographical Tax Shuffle

Your days of state tax arbitrage are over, retiree. Time to pay up where you actually live. But don’t despair! Many states offer tax breaks on military retirement pay. It’s like a “Thank You for Your Service” discount, but from the government.

Remember, taxes in retirement are like a new mission: challenging, but conquerable with the right intel and strategy. So gear up, plan ahead, and march confidently into your tax-savvy retirement!