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What Service Members Need to Know About the Survivor Benefit Program

By Matt Samson, CPWA®

As members of the United States military, you are trained to protect your country, its commonwealths, and possessions. For those with families, that same attention to your call to duty extends into your home. At the end of your service, your comportment is to look out for what you love.

Are you transitioning out of the active or reserve component and into military retirement? If so, Survivor Benefit Plan or Reserve Component Survivor Benefit Plan enrolls you automatically if you qualify. It’s up to you to opt out of the coverage if it’s not the best value for your situation.

You may no longer be as prone to end up in harm’s way as a civilian. That said, in retirement and as a reserve, you still face many risks, exposing your family to financial ruin if something were to happen to you.

It’s great to have the Department of Defense coverage to help your loved ones if you pass away. While you are automatically accepted into this program, you and your named beneficiaries might want to consider alternative insurance coverage. These options can be less expensive and more flexible while still providing the sense of stability you want for your family.

Read on and find out what service members and beneficiaries need to know about the Survivor Benefit program.

How the Survivor Benefit Program Works

In retirement, premiums for the Survivor Benefit program are deducted from your retirement pay at 6.5% of your gross pension, providing up to 55% coverage of your retirement pay. If your pension were $4,000 a month, that would translate to a monthly premium of $260, with a $2,200 benefit. The coverage is more common for a spouse but can also extend to your children.

If you’re in the reserves, you have two options for when coverage starts: your date of retirement eligibility or the date your pension begins. For coverage from our retirement date, your premium would depend on the type of coverage and the difference between your dates of retirement and receipt of your pension. 

This cost comes on top of the 6.5% premium for 55% coverage. The fees and coverage for selecting the pension date as the start are the same as for active-duty retirees.

The Survivor Benefit program is good for helping your loved ones receive some financial support when you pass. However, you might find life insurance outside the Department of Defense less expensive, more flexible, and easier to tailor to your specific needs.

Other Insurance to Consider

There are at least two types of life insurance to consider: term life and permanent life (or whole life). Here’s a quick look at both:

  • Term Life: Relatively simple and the least expensive, this covers you for a period (term) of time, usually one year to 30 years.
  • Permanent Life: More complex and able to be packaged for several benefits, this option comes in whole life and universal life forms.

Just as with the Survivor Benefit program, term life insurance and permanent life insurance have downsides. Premiums for term insurance rise as the number of years goes up, benefits for term life stop after the last year of the term, and there is no cash accrual. 

Permanent insurance may provide the coverage you want and accumulate cash. Nonetheless, it might come at a higher premium as you build your coverage.

Make an Informed Decision

You know how you want to protect and serve your family. That’s why it’s important to recognize that there are pros and cons to the Survivor Benefit program and insurance purchased outside the Department of Defense. The key is getting all the facts and making the decision that is right for your values and goals.

You should consider consulting a financial advisor such as ILS Financial, which focuses on the unique challenges and needs of military service men and women. Doing so could be a solid step toward meeting your insurance needs.

When you’re ready—but watch your deadlines for the Survivor Benefit program coverage—get in touch with ILS Financial for a no-fee consultation. Call (402) 980-5183 or email

About Matt

Matt Samson is a financial advisor at ILS Financial, a financial services firm based in Omaha, Nebraska, empowering military members and veterans toward financial freedom. In his role, Matt is dedicated to serving clients with tailor-made financial strategies that help them work toward work-optional lifestyles. He values the trust his clients place in him and thrives off helping them live out their dreams and enjoy less stress. He is proud to have the opportunity to be a positive influence on the individual’s life, their family members, and possibly for generations to come.

After a distinguished career spanning over 21 years of active and reserve service as a United States Marine, in 2014, Matt made the transition from military service to financial planning, discovering his true calling as a financial advisor. His passion led him to establish ILS Financial—a place where he could leverage a refined and structured process to design and help clients pursue the lifestyle of their dreams.

Matt holds a Bachelor of Science in Actuarial Science from the University of Nebraska – Lincoln, an MBA from the University of Nebraska – Omaha, and a Certificate in Wealth Management Theory and Practice from the Yale School of Management. He also obtained the Certified Private Wealth Advisor® certification from the Institute of Investments and Wealth. Matt continues to proudly serve our nation as a member of the United States Marine Corps Reserves, where he currently serves as a Space Operations Officer. Outside of the financial world, Matt enjoys spending time with his wife, Laura, and their three sons, Brayden, Connor, and William. A big sports fan, he engages with his local sports community as a coach for high school football, youth football, and travel baseball. To learn more about Matt, connect with him on LinkedIn.

Investment advice offered through ICA Group Wealth Management LLC a registered investment advisor.

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