Broker Check

Should I Elect a Survivor Annuity Benefit for my Spouse?


Another important decision you’ll have to make as you near retirement is if you plan to elect a Survivor Annuity Benefit for your spouse. If you do, this will reduce your annuity benefit by either 10 or 5 percent if you are a FERS employee, and can vary if you are a CSRS employee.

The greatest advantage of this benefit is that it will leave your spouse with income for as long as they live, unless they remarry before age 55. Another benefit is that this allows your spouse to remain covered by Federal Employees Health Benefits.

On the downside, the cost for this benefit is somewhat costly when compared to many private life insurance policies that could provide a guaranteed income either equal to or greater than the FERS or CSRS survivor benefit.

The key to making this decision is to first understand your retirement needs. Will your spouse need the income later? Should you enjoy all of your hard-earned benefit while you can? Will your spouse need health benefits? Do you think your spouse will pass before you?

It is very important that you make the right election choice the first time because the survivor benefit can only be changed within the first 18 months of retirement, and not without cost. Consider your options carefully!

If you have questions or would like to set up a complimentary meeting to discuss your individual situation, call my office at (215) 672-7676.