A survivor annuity is a portion of a federal pension that continues paying a spouse after the retiree passes away. Electing it reduces the retiree's own monthly pension in exchange for that ongoing protection. The election is made at retirement, with only a 30-day window to change it once the retirement is finalized.
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One of the most consequential decisions you'll make at retirement is one that often gets made quickly without a lot of thought. The survivor annuity election. It's the kind of thing that's easy to overlook when you're focused on getting through the paperwork.
A survivor annuity is a portion of your federal pension that keeps paying out to your spouse after you pass away. You elect it when you retire, and it reduces your monthly pension a bit in exchange for that protection. Whether it makes sense for you depends on things like your spouse's own income, your savings, and what life insurance you have in place.
Once your retirement is finalized, you only have 30 days to change this election. Getting it right, or at least fully understanding the trade-offs before you commit, is one of the more important financial decisions in the whole retirement process. Talk with an advisor and make sure you're making the decision in the context of your full picture.
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