The Final 3 Years Before Firefighter Retirement: The Planning Window That Changes Everything

Over the past few weeks, I’ve met with several firefighters who are one to three years from retirement. And I have to tell you - it is really sitting with me how emotional and life-changing this stage can be.

Retirement is a big transition for anyone. But for firefighters, it’s different.

There’s a brotherhood. A built-in support system. A rhythm. A structure. A shared history.

Leaving that can feel a little like moving out of state and no longer living near your family.

Some people adapt beautifully. They lean into travel, grandchildren, hobbies, maybe even a second career. Others feel like they’ve lost a piece of their identity.

There is a moment in almost every firefighter’s career when retirement stops feeling like something far off in the distance and suddenly starts feeling very real.

I’ve sat at kitchen tables, in fire stations, and across from office desks where someone says:

“I’ve only got a few years left… I guess I should start figuring this out.”

And honestly?

That’s usually the perfect time to start asking deeper questions.

I often hear apologies -  “I should have started this sooner.”

Guess what? You’re right on time. I’m here for you. This is the part of my job I truly love.

Most firefighters spend decades doing what they do best - showing up for others, working overtime, building seniority, and providing for their families. Early and mid-career planning is usually about saving consistently and letting time do its job.

That matters.

But the final three years before retirement are different.

Not because you’re suddenly trying to build the most money… but because you’re making decisions that can shape the rest of your life and your family’s financial security.

And I want to help you transition into - and through - those retirement years with confidence.

The Shift from Saving to Strategizing

Early in your career, retirement planning is about accumulation. You contribute to deferred compensation, you trust the pension formula, and you let compounding do its work.

As retirement gets closer, planning becomes less about building and more about coordinating.

I often explain it this way:

You’ve spent your career collecting tools. The final few years are about making sure all those tools work together when you need them most.

Retirement for firefighters often includes:

• Pension decisions

• DROP participation (or deciding not to participate)

• Deferred compensation strategy

• Healthcare planning

• Tax coordination

• Designing retirement income

• 
  

Each decision matters on its own. But what really matters is how they work together.

As Carl Richards once said:

“Financial planning is not about being right. It’s about making thoughtful decisions with the information you have.”

The final years of your career are often when those thoughtful decisions matter most.

Pension Decisions: Permanent Choices That Deserve Careful Thought

For many firefighters, the pension becomes the foundation of retirement income. It provides stability and peace of mind that many professions simply don’t have.

But pension elections can also be some of the most permanent financial decisions you’ll ever make.

Survivor options, income elections, and spousal protection all play a role in shaping your long-term retirement picture. These decisions don’t just affect your monthly check. They impact family security, legacy planning, and your spouse’s confidence.

One thing I see often is that firefighters focus on what the pension means for them - which makes complete sense. But retirement is a family transition

.

Spouses often have different questions. Different fears. Different priorities.

Retirement isn’t just about leaving the job. It’s about protecting the life you built outside of it.

DROP Is Not Autopilot

When firefighters enter DROP, there is often a sense of relief. You’ve reached a milestone. The retirement date feels clearer. Things feel predictable.

And DROP absolutely can provide valuable opportunities.

But it can also be one of the most important planning windows in your career.

DROP changes the structure of retirement savings and often creates time to step back and ask bigger questions:

• Is my investment strategy aligned with my retirement timeline?

• Do I have the right level of risk as retirement approaches?

• Am I preparing for income once the paycheck stops?

• Have I thought through tax timing and withdrawals?

• 
  

DROP can feel like coasting toward retirement. But for many firefighters, it’s actually when strategy matters most.

And remember - DROP doesn’t have to be part of your retirement plan. Some firefighters choose not to participate. Others may not be able to continue working. What matters most is that your decisions align with your goals.

Deferred Compensation Strategy Changes Near Retirement

For most of your career, deferred compensation is about growth.

As retirement approaches, the focus shifts to distribution - how and when that money gets used.

The strategy that helps build retirement savings is not always the same strategy that supports retirement income.

This stage opens important conversations about:

• Withdrawal timing

• Coordinating taxable and tax-deferred income

• Potential Roth planning opportunities

• Adjusting investment risk

• 
  

These decisions don’t need to be overwhelming. But they do benefit from thoughtful coordination with the rest of your retirement plan.

Healthcare Planning Is Often the Biggest Unknown

Healthcare is one of the most common concerns I hear from firefighters nearing retirement.

Many retire before Medicare eligibility, which means healthcare coverage becomes a major planning component.

Costs can vary. Needs change over time. Planning early reduces surprises.

And remember - as a public sector employee, you may be able to use up to $3,000 per year from your pre-tax deferred compensation savings for qualified healthcare premiums in retirement, potentially reducing your tax burden. That’s just one example of how coordination can make a difference.

Retirement Is Also an Emotional Transition

This part doesn’t get talked about enough.

Firefighting isn’t just a job. It’s a brotherhood. A routine. A structure. A purpose.

Retirement brings freedom and flexibility - but it can also bring change.

Schedules shift. Daily structure changes. Identity evolves.

Many retirees discover that financial confidence plays a huge role in how much they enjoy this next chapter. When income feels secure and the plan feels clear, it’s easier to focus on grandchildren, travel, hobbies, or whatever comes next.

Why Coordination Matters More Than Ever

Most retirement mistakes don’t happen because someone didn’t work hard enough or save enough.

They happen because decisions were made in isolation instead of coordination.

Retirement for firefighters often includes multiple income sources, multiple tax layers, and long-term planning decisions that interact with each other.

Your pension is a beautiful piece of the puzzle - but it’s not the only piece.

Retirement success is rarely about one perfect decision. It’s about how all the decisions work together over time.

Final Thoughts

Firefighters spend their careers protecting others.

Retirement is about protecting your family, your income, and your peace of mind.

The final three years before retirement can feel overwhelming - but they can also be incredibly empowering when approached with thoughtful planning and clear strategy.

If you’re within a few years of retirement and starting to think more seriously about these decisions, you’re not alone. The questions you’re asking are normal.

Helping firefighters transition into and through retirement with clarity and confidence is something I care deeply about. If you ever want to sit down and talk through your options, I’m always happy to be a resource.

Because the final years before retirement aren’t just about finishing strong.

They’re about building the next chapter of your life.

Planning today for the life you want tomorrow.

Until next time,

Shannon

This article is intended for educational and informational purposes only and should not be considered individualized financial advice. Retirement decisions should be reviewed based on your personal financial situation, goals, and retirement system guidelines.