FERS survivor benefit

[Anonymous]

I’m a fed with 15 years service. I’m in my mid 40s and not planning to retire soon so I haven’t attended retirement seminars or similar classes my agency offers.

My DH and I are updating our wills. We also plan to meet with a financial advisor soon. It prompted me to read up on survivor benefits - or at least try. The OPM website and other sources I found mention monthly payments but also mention 50% of salary. I’m confused by this. I assume that the 50% is used for a calculation (maybe like the way the best three years is use), or is the payment itself 50% of salary? I was also confused how to figure out the lump sum vs other options. Hopefully this won’t be relevant any time soon, but can anyone recommend a straight-forward resource to learn more or explain it simply to me? Thanks!

[Anonymous]

It is not 50% of the salary. This is referring to 50% of the deemed ‘benefit’ for the annuitant. In other words, they calculate a ‘benefit’ for the Fed employee. Then they only allow 50% of that benefit to come to the surviving spouse. (Also, they take out a huge chunk to pay for Federal BCBS, too, if you want to continue that.)

[Anonymous]

Don’t forget the life insurance benefits too.

[Anonymous]

Your spouse would get both.

There is the Basic Death Benefit which is 50% of your salary plus a fixed amount (which I believe is current'y around $40,000).

Your spouse would also get a Survivor Annuity, which is 50% of your calculated value (15 years would be 15X.01Xyour high three salary). So if your high three is $100,000, your spouse would get $7,500 per year.

[Anonymous]

Anonymous wrote:Your spouse would get both.

There is the Basic Death Benefit which is 50% of your salary plus a fixed amount (which I believe is current'y around $40,000).

Your spouse would also get a Survivor Annuity, which is 50% of your calculated value (15 years would be 15X.01Xyour high three salary). So if your high three is $100,000, your spouse would get $7,500 per year.

Meant to also say that the Basic Death Benefit is a one time payment, whereas the Survivor Annuity is given every year until the spouse dies.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Your spouse would get both.

There is the Basic Death Benefit which is 50% of your salary plus a fixed amount (which I believe is current'y around $40,000).

Your spouse would also get a Survivor Annuity, which is 50% of your calculated value (15 years would be 15X.01Xyour high three salary). So if your high three is $100,000, your spouse would get $7,500 per year.

Meant to also say that the Basic Death Benefit is a one time payment, whereas the Survivor Annuity is given every year until the spouse dies.

They also, of course, get a lump sum payment for unused leave, which can be substantial. And if you had the life insurance through the Federal Government, there's that. The big difference is that the FERS takes a long time to get processed. Like at least six months, whereas the Lump Sum Payment comes almost immediately so that you can pay for the funeral and hospital expenses.

[Anonymous]

Anonymous wrote:Your spouse would get both.

There is the Basic Death Benefit which is 50% of your salary plus a fixed amount (which I believe is current'y around $40,000).

Your spouse would also get a Survivor Annuity, which is 50% of your calculated value (15 years would be 15X.01Xyour high three salary). So if your high three is $100,000, your spouse would get $7,500 per year.

Plus, they take out money for your medical insurance, so you only get a few hundred a month. That’s it.

[Anonymous]

Just FYI but I think if you remarry before 55 you lose the benefit.

[Anonymous]

When the federal spouse retires, they can choose if they want

a) Full FERS survivor annuity (50% of the spouse's monthly pension)
b) reduced FERS survovor annuity (25% of the spouse's monthly pension)
c) no FERS survivor annuity (0%)

a) is the default; spouse would need to consent to change it. The cost is 10% of your pension monthly.
b) costs 5% of the monthly pension.
c) has no cost

If the spouse will continue to need FEHB (Federal Employee Health Benefits) after the death of the federal employee/retiree, their portion of the premiums would be deducted from their pension payment.

The non fedgov surviving spouse is ONLY eligible for FEHB to continue if he or she gets either a) or b). If choice c is selected, when the federal retiree dies, the spouse cannot continue FEHB.

[Anonymous]

Anonymous wrote:When the federal spouse retires, they can choose if they want

a) Full FERS survivor annuity (50% of the spouse's monthly pension)
b) reduced FERS survovor annuity (25% of the spouse's monthly pension)
c) no FERS survivor annuity (0%)

a) is the default; spouse would need to consent to change it. The cost is 10% of your pension monthly.
b) costs 5% of the monthly pension.
c) has no cost

If the spouse will continue to need FEHB (Federal Employee Health Benefits) after the death of the federal employee/retiree, their portion of the premiums would be deducted from their pension payment.

The non fedgov surviving spouse is ONLY eligible for FEHB to continue if he or she gets either a) or b). If choice c is selected, when the federal retiree dies, the spouse cannot continue FEHB.

The Fed BCBS is awesome. Take it and keep taking it for life.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Your spouse would get both.

There is the Basic Death Benefit which is 50% of your salary plus a fixed amount (which I believe is current'y around $40,000).

Your spouse would also get a Survivor Annuity, which is 50% of your calculated value (15 years would be 15X.01Xyour high three salary). So if your high three is $100,000, your spouse would get $7,500 per year.

Meant to also say that the Basic Death Benefit is a one time payment, whereas the Survivor Annuity is given every year until the spouse dies.

Could you please link the info re Basic Death Benefit (when survivor annuity is chosen). I am having hard time finding the info. Thank you!

[Anonymous]

Anonymous wrote:When the federal spouse retires, they can choose if they want

a) Full FERS survivor annuity (50% of the spouse's monthly pension)
b) reduced FERS survovor annuity (25% of the spouse's monthly pension)
c) no FERS survivor annuity (0%)

a) is the default; spouse would need to consent to change it. The cost is 10% of your pension monthly.
b) costs 5% of the monthly pension.
c) has no cost

If the spouse will continue to need FEHB (Federal Employee Health Benefits) after the death of the federal employee/retiree, their portion of the premiums would be deducted from their pension payment.

The non fedgov surviving spouse is ONLY eligible for FEHB to continue if he or she gets either a) or b). If choice c is selected, when the federal retiree dies, the spouse cannot continue FEHB.

This is key. I would not have selected a survivor annuity had this not been the case, but allowing my spouse to keep the FEHB coverage was too important.

[Anonymous]

Reviving this thread - to ask about dual fed couples.

If both of us chose the no survivor pension benefit, the surviving spouse would still be eligible for FEHB. And the cost would then be take from the surviving spouse pension, correct?

[Anonymous]

Anonymous wrote:Reviving this thread - to ask about dual fed couples.

If both of us chose the no survivor pension benefit, the surviving spouse would still be eligible for FEHB. And the cost would then be take from the surviving spouse pension, correct?

This is true assuming the surviving spouse is independently eligible for FEHB at retirement (generally meaning they were covered by FEHB continually for the 5 years before retirement).

You want to be careful that this is documented properly when you retire-- I am a little concerned that the new online retirement account is not set up to properly assess whether people who were insured under their spouses insurance are eligible for FEHB as a result even if they never paid premiums themselves.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Your spouse would get both.

There is the Basic Death Benefit which is 50% of your salary plus a fixed amount (which I believe is current'y around $40,000).

Your spouse would also get a Survivor Annuity, which is 50% of your calculated value (15 years would be 15X.01Xyour high three salary). So if your high three is $100,000, your spouse would get $7,500 per year.

Plus, they take out money for your medical insurance, so you only get a few hundred a month. That’s it.

But they get health insurance, which is huge.