By Office of Financial Readiness     July 2026

Transitioning out of the military to civilian life is a big step that comes with several financial changes. Many benefits you've had as an active-duty service member will be shifting or changing, so it's important to be aware of how these changes will affect your family's finances. Whether you're separating or retiring, researching your options and planning ahead is the best way to make your transition go as smoothly as possible.

One crucial area to consider: your health insurance. As an active-duty service member, you and your qualifying family members have had TRICARE as a health benefit. While you can still have TRICARE coverage in retirement, your change in status will affect your available options. If you're ending your service before retirement, there are also options to help bridge the gap between TRICARE and your new civilian health insurance.

Let's discuss the various options based on your transition situation.

TRICARE Coverage in Retirement

First, remember to schedule your Separation History and Physical Examination (SHPE) between 90 and 180 days prior to your retirement date. Upon retirement, you will be unenrolled from TRICARE Prime. To ensure you don't experience a gap in coverage, you must re-enroll in a new TRICARE plan within 90 days of your retirement date. You and your family members will have the option to enroll in one of the following plans, depending on your needs and situation:

• TRICARE Prime (depending on location)
• TRICARE Select
• US Family Health Plan (depending on location)
• TRICARE For Life (with Medicare Part A and B coverage)
• TRICARE Select Overseas

If you don't enroll in a new TRICARE plan within 90 days of retirement, you still have options. You can request retroactive enrollment within 12 months of retirement and receive coverage effective back to the date of your retirement, but enrollment fees would still need to be paid starting at your retirement date.

If you don't request enrollment within the first year of your retirement, you may still be able to enroll during TRICARE Open Season, which occurs each fall, or when you or a member of your family experiences a qualifying life event.

It's important to note that if you don't seek TRICARE coverage in retirement, you won't be eligible to receive care at a military hospital or clinic unless space is available. That's why planning ahead and knowing your options in advance is so important. To choose between the plans, use the TRICARE Plan Finder or compare plans to decide what's best for you and your family. Beyond coverage specifics, there's one more area that requires careful consideration for your financial future: costs.

TRICARE Costs in Retirement

As an active-duty service member, your TRICARE benefits can cost you nothing out of pocket and include very minimal fees for your family members. After retirement, there will be some increases in costs that you'll want to account for in your spending plan and finances. The exact costs will vary based on your chosen plan, but may include:

• Annual enrollment fees
• Increased copayments and cost-shares
• Increased catastrophic cap
• Higher prescription costs

Use the TRICARE Compare Cost Tool to determine how your chosen plan would affect you financially.

TRICARE Coverage After Separation

If you leave the service before you reach retirement, you may still qualify for temporary health coverage through TRICARE to help ease the transition to civilian life. There are two options for temporary coverage:

• The Transitional Assistance Management Program provides 180 days of premium-free health care benefits.
• The Continued Health Care Benefit Program provides premium-based temporary health coverage for 18 to 36 months.

Your eligibility for these programs depends on your military status before separation, as well as a few other contributing factors. For answers about your specific situation, visit the TRICARE website or contact your service personnel department.

Beyond transitional health benefits through TRICARE, you'll need to financially prepare for finding health coverage through an additional option. This will depend on whether you intend to start a new job, go back to school, start your own business or whatever else your next adventure holds. Meet with a personal financial manager or counselor for support and to develop strategies as you make your next step.