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Changes to Spousal Survivor Benefits for Veterans


In a groundbreaking move, veterans will now have the option to modify their spousal survivor benefits starting in 2023. This opportunity, currently available for just one year, allows qualifying service members to ensure that their loved ones receive a pension even after the retiree passes away.

The Survivor Benefit Plan offers spouses (and in some cases, their children) up to 55% of the veterans’ retirement pay as a pension. This payment, which is adjusted for inflation, continues throughout the surviving spouse’s lifetime or until the child reaches a specific age.

Until now, veterans’ decisions regarding these benefits were permanent. However, in 2023, they will have the chance to either opt into or opt out of the program.

According to Curt Sheldon, a certified financial planner at C.L. Sheldon & Company, a firm specializing in financial planning for active and retired military members, the Survivor Benefit Plan is indeed a valuable asset. Sheldon highlights two key advantages of the plan: firstly, it keeps up with rising costs of goods and services through inflation adjustments, and secondly, it provides long-term support to the surviving spouse.

To enroll in the plan, members contribute 6.5% of their retirement pay. While some veterans may choose not to participate, citing uncertainty regarding whether their spouse will ever need the benefits (since contributions are forfeited if the spouse passes away first), many recognize the value it holds for their loved ones.

Overall, the introduction of this one-time opportunity in 2023 gives veterans greater flexibility and control over their spousal survivor benefits while ensuring that their families receive necessary support in the future.

Planning for the Future: Ensuring Financial Security for Veterans’ Spouses

As veterans, it is crucial to consider the financial circumstances that your spouse may face in the unfortunate event of your passing. Mike Meese, the president of the American Armed Forces Mutual Aid Association, poses an essential question: “What financial resources does your spouse have to rely on?”

One aspect to consider is whether your spouse has other investments, pensions, or life insurance policies. Additionally, it is important to understand how Social Security benefits would support their retirement assets. If your spouse lacks external investments, insurance coverage, and personal financial programs, it might be prudent to reassess their survivor benefits during the open season.

If you decide to take advantage of the open season and opt-in, you will need to repay the premiums you would have owed if you had enrolled at the time of your retirement. On the other hand, if you opt-out, there will be no refund issued.

During this period, it is not possible to change the designated beneficiary. For instance, if you initially selected your spouse as the beneficiary but later prefer your children to receive the benefits, you cannot make that alteration. The deadline for making beneficiary changes is at the end of the year. However, keep in mind that determining the exact amount required for opting in will depend on your collaboration with the Defense Finance Accounting Service.

Taking such financial considerations into account will help ensure your spouse’s stability and security in the future. By being proactive and making informed decisions during open enrollment, veterans can provide their loved ones with the necessary support and peace of mind.


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