Should You Enroll in the Survivor Benefit Plan?

Should You Enroll in the Survivor Benefit Plan?

August 15, 2022

The government provides myriad benefits to military service members. While some are more appealing than others, the Survivor Benefit Plan (SBP) is one worth looking into.

After years of service, Veterans are entitled to military retired pay that lasts their lifetime and, in some cases, their spouse’s as well. Unfortunately, retired pay is one of the benefits that ends upon the death of the retiree, and this can have a negative impact on family members. Thankfully, some benefits can survive the retiree’s death, and one of those is the Survivor Benefit Plan. 

What Is the Survivor Benefit Plan?

The SBP offers a monthly income of up to 55% of your retired pay to your dependents in the event of your death. SBP is essentially an annuity payable to your designated beneficiary, and in most cases it’s relatively inexpensive compared to private life insurance products. Of course, there are different options within the plan that will determine how it works for each individual. For example, while SBP typically provides income to your spouse, in some instances, it can do the same for your children or others.

To enroll for the SBP, a participant agrees to pay a portion of their retired income toward the premiums. The most common payment is 6.5% of your retired income per month, which results in the maximum benefit of 55% of your base retired pay. A critical point here is that SBP premium payments are pre-tax. Moreover, premiums are only paid for 30 years, after which you are considered “paid up” and no more premiums are required while the 55% income benefit is still provided upon the retiree’s passing.

If your family elects for a lower benefit amount (to a minimum of $300), the premiums decrease. If you add qualified dependents on the plan along with your spouse, the premiums will increase. More specific information regarding the costs of premiums can be found here

Is the Survivor Benefit Plan Right for You?

The SBP provides an affordable income source that offers comfort for many military families. The benefit payments are protected against inflation and are adjusted every December based on the Consumer Price Index. There are no health exams or other qualifying requirements to participate.  

While SBP provides a bevy of benefits, it isn’t necessarily right for everyone. For example, if a retiree’s spouse is considerably older or is in ill health, SBP may not be needed. Moreover, if you have long-held permanent life insurance, maintaining that policy may be advisable. In short, there is no one-size-fits-all advice for retirees. It’s also important to remember that insurance and investments serve different needs. Even with the SBP, you still need a long-term investment strategy that will help you build wealth and take care of your family—both while you’re here and when you pass. 

We Can Help

To make the best decision for your family, it helps to receive an objective opinion about your unique circumstances from a trusted professional. At Fiduciary Wealth Management, we are intimately familiar with the financial opportunities and obstacles veterans face and would be honored to partner with you as you make financial decisions and work toward your goals. To get started, schedule a phone call now!

About Rocklin Senavinin, CFP®

With over 20 years of experience in the financial planning industry, Roc has dedicated his career to helping individuals live comfortably in retirement and enjoy the assets they have spent their career building. He is co-founder of Fiduciary Wealth Management, a fee-only registered investment advisory firm in Little Rock, Arkansas. As a CERTIFIED FINANCIAL PLANNER™ professional, he has advanced training in the holistic process of creating a personal financial plan that addresses a person’s comprehensive needs for the short and long term. To learn more, connect with Roc on LinkedIn or visit If you have questions, feel free to schedule a phone call using this link.


The views expressed represent the opinions of Fiduciary Wealth Management, LLC and are subject to change. These views are not intended as a forecast, a guarantee of future results, investment recommendation, or an offer to buy or sell any securities. The information provided is of a general nature and should not be construed as investment advice or to provide any investment, tax, financial, or legal advice or service to any person.

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