Getting the most out of the navy...

Forget about the house for now. Financially, if you're looking to get out, the key is to stay as liquid as possible: no stocks, bonds, retirement plans, real estate, etc. Put cash in a savings account only. Lack of compounding interest is going to suck, but on a limited investment time horizon you need to be absolutely certain the money will be there when you need it.

Let me explain where I'm coming from. It was 2004 and I knew I was getting out within two minutes of meeting my XO in my first DIVO tour. We were on deployment, but the ship was homeported in San Diego and I would price real estate on the NIPR with the hopes of using the fat tax-free deployment checks as a down payment. The cheapest place I could find was a studio condo in Shitty Heights for $250k. Just a few years before, my parents had closed on a 4 bed, 3 bath home on a lake in a gated community for less than that. Granted it was in North Carolina, but I still couldn't wrap my head around it.

At the same time, I could overhear 2nd Class POs talking about investment properties and how "Real estate never goes down." Weren't people saying the same things about stocks in the 90s? Thankfully, a quick google search on "real estate bubble" led me to a number of blogs that explained the causes and eventual outcome of the burgeoning housing bubble.

I fucked around with stocks for a bit instead. Made some money, lost some money, but learned about my personal investment style. Value investing struck a chord with me, and The Little Book of Value Investing saved my ass. As an aside to typical value investment strategies, the author mentioned the importance of personal investment timelines. Stocks are great for the long-haul, but if an investor needs ready access to capital nothing beats cash. I promptly liquidated my USAA brokerage account and put everything in a savings account. It was 2007.

I got out three years later, debt free, GI Bill, and plenty of coin in the bank. Many of my fellow JOs weren't so lucky. They had underwater mortgages, brokerage accounts that had taken a hit, money tied up in the TSP and couldn't weather the shitty job market.

I don't know exactly what your personal investment timeline is, but if you're 3.5 years into a first enlistment and looking to get out soon you need to stay liquid. I don't want to proffer any investment advice, but the market's been on a tear and the structural problems that led to the 2008 economic crisis haven't been addressed.

TL:DR: Cash is king

/r/navy Thread