My husband is due to retire after serving 30 years in the Coast Guard. I understand we won't get food money or housing money. Medical will cost $460.00 a year and Dental will cost about $1000.00 a year. Can anyone give me any information on anything else? My husband told me that we would have to pay monthly to keep the SBP and he said it's a lot to keep and we both have to sign something stating we don't want it. Can he keep life insurance through the military? If he gets it someplace else, it will cost a lot but the VGLI website seems cheaper to keep it. Even though I've been with my husband for 13 years, I'm still new to the military because he doesn't tell me anything. Besides, when I ask him something he tells me it cost too much. LOL I told him that medical will cost $460.00 a year which is not that much but he seems to think it's a lot. LOL So it's up to me to do some checking to see what and how much we can afford. Any suggestions on anything after retirement will be appreciated. Dental insuarance is $82.94 a month (now that's a lot) but does anyone know if it's a good coverage for dental. Medical is basically the same but with a co-pay which is still good. Is there any website for retirement benefits?

Thank You,

Bernice

Bernice, haven't we talked about this before? You need to attend a "TAPS" class with your husband... Take the SBP.... it is a better deal than life insurance...

Wray....

Bernice, things always seem to "cost too much" when it's been free or pretty much free for the past 30 years . My wife was a Coastie wife for 16 years . I made it a point to include her in ANYTHING that had to do with money as it affected our family . She was the one who took the kids to the doctor so she became well versed in CHAMPUS then TRICARE . If you go with TRICARE standard (right now at least), it costs nothing. A sup insurance will run you about 120 or so a month and that's what it was to cost me, my wife and 3 kids (not including dental or life). I work for a company who has some good coverage so TRICARE isn't a issue anymore for me however, I did use them the past 2 years till some moron in congress decided to make it illegal for large companies to "help" pay for additional TRICARE coverage , so I went back to HAP (but I still use tricare's prescription coverage as I elected NOT to get that coverage from my employer where it use to be mandatory, thanks to this "new" law, they relaxed that part.. PAY BACK ). Good luck on the transition and from my experience.. the TAP class could have been 1 day long, not the 3 I attended. At least my class seemed to be pushing postal jobs so it waisted LOTS of time. Putting my "resume" up on the govt "hey head hunters.. come get me" website was the most usable thing. Some might get more out of it but I got educated BEFORE the last day so I wouldn't be too blindsided .

Bernice, definitely go w/ your husband to a TAPS class/session. This way you can make an educated decision. What might be good for someone, might not be good for you. It all depends. I have my opinion on SBP, life insurance, & Tricare Prime. But my opinion is based on my personal situation. That's why it is important you find out for yourself the options available.

But keep in mind what TC1USCG indicated, what has been free all this time, will seem VERY expensive from now on. I agree w/ that 100%, but in my opinion, reality is that we are still better off than many Americans.

Some info for all...................... (I have SBP & have NO intentions of canceling it...MY wife will get $$$$ as long as she is alive....)



SBP TERMINATION UPDATE

There are four payment termination scenarios for retirees who have elected SBP:

1. Between the 25th and 36th month after the retiree begins to draw retirement pay. Your spouse must concur in such an election to withdraw and there is no premium refund or renewal option.

2. Divorce or death of the eligible beneficiary. No premium refund but SBP may be reinstated within one year of acquiring a new spouse.

3. Rated by the VA as totally disabled for 10 or more continuous years or less than 10, but more than five, years continuous from the last date of active duty. Under these circumstances, your death would be presumed to be of service-connected causes, ensuring your spouse's entitlement to DIC. When you die, your spouse will be refunded all premiums paid, except for the added costs associated with an Open Enrollment period. Your spouse must concur in such an election to withdraw and there is no renewal option.

4. Any retiree who is age 70 or older and whose retired pay has been reduced for SBP premiums for at least 360 months. Coverage continues without premiums with no premium refund.

Under option 3 you and your spouse may find no advantage to continue SBP coverage. However, before you make a final decision there are a number of factors to be considered:

a.) How much retirement pay do you draw? Current DIC rate for 2008 is $1091 for veterans whose death resulted from a non service-related injury (i.e. accident, murder or suicide) or disease. VA will add to this $233 monthly if you have been disabled for 8 years prior to death and the spouse has been married to you this entire time. At 55% of base pay how much will be your SBP benefit? If less than $1324 monthly she/he will have to forfeit it IAW current law to receive DIC. If so, all premiums paid to date will be refunded to your beneficiary in lump sum.

b.) SBP is taxable whereas DIC is not. Thus, the lump sum refund of premiums will be considered income for the tax year in which you die if it is paid by 31 DEC of that year. Your spouse will be able to file a joint tax return for that year allowing her to claim the standard deduction for two and married filing jointly deductions on her gross income.

Using 2007 figures this equates to $6800 and $10700 (more if over 65at time of death) for a joint return vice $3400 and $5350 for a single return. This equates to approximately $875 in reduced tax. If the payment is not made until after 31DEC of the year in which you die she will have to pay tax on the full amount of the refund without the benefit of including you in her exemptions. Payments can take in excess of 5 months.

c.) Nonresident aliens are taxed automatically at the rate of 30%, unless there is a tax between the United States and the foreign country permitting lesser rate. This includes any lump payment of premium refunds.

d.) The 2008 NDAA authorized a special “indemnity allowance” payment of $50 per month effective 1 OCT 08 to survivors of members entitled to retired pay (or of Guard/Reserve retirees who died before age 60) whose SBP annuities are reduced by VA survivor benefits (DIC), That amount will increase by $10 each year for 5 years. The indemnity allowance might be perceived as a first step toward easing the ban on concurrent receipt for military widows.

DFAS has not yet published the guidelines on to whom this will be paid. To withdraw from SBP now could eliminate any future option of receiving this amount and/or full SBP in addition to full DIC if Congress subsequently approves legislation to accomplish this. In recent years this legislation has been introduced annually and each year has advanced further through the legislative process than in the previous year.

e.) By 1 OCT 2012 under current law the spouse will be receiving an extra $1200 indemnity allowance per year. To drop SBP the lump sum payment of all premiums paid would have to equal or exceed $24,000 to earn $1200 in taxable interest at a rate of 5%.

Eligible retirees must complete a DD Form 2656-2, SBP Termination Request available at http://web1.whs.osd.mil/forms/DD2656-2.PDF, and, if married, obtain their spouse’s written concurrence (notarized or witnessed by an authorized military representative). For additional info on SBP refer to:

www.dfas.mil/retiredpay/survivorbenefits/generalinformation.html

http://www.dfas.mil/retiredpay/paid-upsurvivorbenefitpaymentsbp.html

FYI, my mother-in-law signed that little piece of paper and now she has no survivor benefits if he dies, gets killed etc. She has no education, and no marketable job skills. She made a mistake in my opinion. Good luck, and remember to look out for yourself.

When I talked to a Navy Mutual representative at my Taps class he showed me in 'black and white' I would be far better off taking SBP.. (I was ready to take out another 100K life insurance policy) My wife is also 10 years younger than me..

I also think it is far better for her to get a monthly check as long as she is alive than one big check which could very easily be spent on luxury items....

Wray...

Same as Wray, my TAP class taught me the same. SBP is best way to go. Try to pay insurance premiums at age 65 for the same benefit. He did go on to say the SBP supplements were not a good investment, so I took his word for it and took the SBP. On top of that, I believe that if you have paid it for 30 years, or at age 70, you are considered 'paid up' and don't pay the premiums anymore. I'm not sure if it's 30 consecutive years or 30 total.

--Jim
Life is good!

I'm sure it was mentioned but what happens to all that cash if SHE dies before you?

tc1uscg, I'm right there w/ you. But it all comes down to what makes you feel more comfortable. I don't think there is really one better choice than the other. It's all what makes you sleep better at night.

quote:

Originally posted by tc1uscg:
I'm sure it was mentioned but what happens to all that cash if SHE dies before you?

If it bothers you that much, you can always run out and marry an 18 year old replacement. If you are over 70 & have the paid up SBP, you REALLY come out ahead on the deal. When you croak, she will, with any luck, draw 55% (plus COLAs) of your retirement for 60 years or more.

My late husband set me up for SBP and part of his pension. When I go to the doctor I use tricare/medicare no charge

How does receiving social security impact collecting SBP?

Is a surviving spouse eligible for both or is the social security payment reduced by the SBP payment? (Considering I kick the bucket.)

It doesn’t anymore. It did before April of this year.
The Survivor Benefit Plan (SBP), as originally enacted, provided an annuity equal to 55 percent of the annuity base amount until the annuitant reached the age of 62. Upon reaching the age of 62, the annuity was reduced by the Social Security Offset (SSO). Public Law 99-145, effective March 1, 1986, eliminated the SSO and created a two-tier method of calculating annuity reduction. Under the two-tier method, an annuitant receives 55 percent of the annuity base amount until the age of 62, then 35 percent of the annuity base amount after age 62. However, the law contains a “grandfather” clause whereby an annuitant will receive whichever payment is more favorable under the two methods of calculation, providing the retiree was retirement eligible on or before October 1, 1985.
Section 644 of the Ronald Reagan National Defense Authorization Act for Fiscal Year 2005, provides for a phased-in elimination of the Social Security Offset from the SBP annuity. Under this legislation, annuitants over age 62 will eventually receive their entire annuity amount (55 percent of the amount elected by the retiree). There will no longer be an offset for Social Security effective April 1, 2008. This act increases the SBP annuity percentage upon reaching the age of 62 from:
· 35 percent to 40 percent effective October 2005
· 40 percent to 45 percent effective April 2006
· 45 percent to 50 percent effective April 2007
· 50 percent to 55 percent effective April 2008
http://www.dfas.mil/retiredpay/socialsecurityoffsetsso.html