I'm in the Military. Do I need an IRA?
The short answer is yes, but I'll give you the long answer, too.
An Individual Retirement Account at it's most basic level is a kind of savings and investment account where you can put money to help you in retirement. You can add up to $5,500 every year according to the current IRS standards. You have two basic options for your IRA: Traditional or Roth. Let's look at some of the pros and cons of each:
Adding money to a Traditional IRA will lower your tax bill at the end of the year since every dollar added to the IRA is a dollar deducted from your taxable income. Adding money to a Roth IRA will not impact your tax bill in the current year. The simplest way to make the choice between depositing into a Roth IRA vs a Traditional IRA is to look at your current highest income tax bracket and compare that to the amount you expect to spend yearly following retirement. If you expect your income tax bracket to be higher in retirement, contribute to Roth. If you expect to spend less in retirement than you earn now (hint: this should be your goal when you're nearing the peak of your career), contribute to the Traditional IRA. Simply adding $5,500 a year between 20 and 60 will leave you with $220,000 in your retirement account assuming you didn't invest it at all. If you add the power of compound interest to the equation, you can imagine the possible pile of money you could have built for yourself.
This clear picture can get a little muddled if you're like me and want to retire before 59.5 years of age. The reason it gets muddled is because you are not technically allowed to use your retirement accounts until you turn 59.5 without paying some kind of penalty. This is why I focus on Roth IRA contributions. With a Roth IRA, you are allowed to access the principal of your investments without paying any penalty because you already paid taxes on that money. With a Traditional IRA you would be forced to pay taxes at your marginal rate and a 10% penalty for early withdrawal. For early retirement, Roth IRAs are almost magic. Of course, 20 years of contributions at $5,500/year only gets you to $110,000 of principal, but having that $110,000 on top of your pension can help a lot during the years between retiring from the military and actually reaching retirement age. If you want to retire early, you should still DEFINITELY maximize your tax advantaged retirement accounts. However, you will also want to build a portfolio of investments outside of your retirement accounts that can include stocks, bonds, index funds, real estate, and businesses to hold you over for the 20 years between earning your military pension and reaching official retirement age.