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How military survivor benefits fit into your estate planning

On Behalf of | Sep 6, 2023

If you’re a current or retired member of the military, your estate plan likely won’t look much different than the typical civilian’s. Of course, every person’s estate plan is unique, depending on their marital status, whether or not they have children, what kind of assets they have and the legacy they want to leave behind.

As a service member, however, your surviving family members will have access to a wide range of benefits that non-military families don’t receive. As you develop your estate plan and determine what your family’s financial needs will be after you’re gone, it’s important to consider those benefits..

Not all estate planning revolves around documents like a will, trust, powers of attorney and advance directives. Beneficiaries also need to be designated directly with the companies that hold investment and retirement accounts and life insurance policies. Let’s look at a few military survivor benefits that will go to your loved ones and what steps – if any – you need to take to ensure that they go to a specific loved one.

Survivor benefit plan (SBP)

This is a monthly annuity paid to a surviving spouse and/or children. It’s based on the servicemember’s pay or retirement income. Active-duty servicemembers don’t have to do anything for the annuity to be paid. Those who are retired need to pay premiums for their loved ones to be eligible for it. 

Dependency and Indemnity Compensation (DIC)

This monthly benefit is paid to surviving family members of active and retired service members who died for a service-related injury or medical condition. Surviving families of vets who were receiving VA disability benefits for a service-related injury that’s left them totally disabled can also receive benefits even if the cause of death wasn’t service-related.

Death gratuity

This is a fixed $100,000 benefit that goes to the surviving next of kin if a servicemember dies either while on active duty or within 120 days of leaving the military.

This is just a brief overview of benefits your family may be entitled to after you’re gone. Don’t forget to consider other things like life insurance available through the military, continued health insurance and other benefits and financial help with funeral and burial expenses.

The more you know about the financial benefits your surviving loved ones are entitled to, the clearer the picture will be of how best to divide your assets among them in your estate plan. Having experienced legal guidance can help immensely.