Military Update: Sailors, Marines missing out on SBP enrollment »
Posted By kellekrapache128 1 month, 4 weeks ago in NewsA typical officer retiring today who declines to enroll in the Survivor
Benefit Plan lets the government off the hook for a subsidy worth $50,100 in “net present value,” say Department of Defense actuaries.
The typical enlisted retiree who chooses not to enroll in SBP is turning down a subsidy having a net present value of $22,300.
Net present value is the dollar amount a new retiree would have to invest at time of retirement so that, when combined with monthly premiums, it would build an annuity for the surviving spouse of equal in value to SBP.
This is yardstick to measure the value of SBP. Here’s another:
A 40-year-old retiree with a 38-year-old wife who elects full SBP coverage on a $2,000 monthly retirement could expect to pay $62,000 in total premiums if he died at age 65. If his widow were to live just seven more years, until she reaches 70, she would receive $401,897 in SBP.
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kellekrapache128
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