SBP
Pros
- Provides 55% of military retirement income for life of surviving spouse,
- Inflation protected,
Cons
- Costs 6.5% of military retirement, paid for up to 30 years or age 70; whichever is longer,
- Benefit is generally 15-25% of actual active duty take home pay, in monthly installments, not a lump sum,
- No secondary beneficiary after death of spouse,
- Decision to opt in or out is, for most practical purposes, irreversible** after official retirement.
Every family situation is unique, so thinking through this decision and having a conversation is important. Let us do a Military Retirement Analysis to show you whether SBP makes sense for your family!
The cost and availability of life insurance depend on factors such as age, health, and the type and amount of insurance purchased. Before implementing a strategy involving life insurance, it would be prudent to make sure you are insurable. As with most financial decisions, there are expenses associated with the purchase of life insurance. Policies commonly have mortality and expense charges; if a policy is surrendered prematurely, there may be surrender charges and income tax implications. You should consult a qualified tax professional for tax advice on your own personal situation. All guarantees are based upon the claims-paying ability of the issuer.