Your Guide to Federal Employee Survivor Benefits
When you're planning for retirement, you're not just planning for yourself—you're planning for your family's future, too. A huge part of that planning involves understanding the federal survivor benefits package. It’s designed to provide a financial cushion for your loved ones if you pass away, through a combination of ongoing income, life insurance, and your TSP savings.
Understanding Your Survivor Benefit Options
Let's be honest, thinking about survivor benefits can feel a little heavy. But framing it differently helps. Think of it as creating a financial bridge for your family, ensuring they have stability when they need it most. This isn't just one single benefit; it's a few different pieces that work together.
The whole point is to make sure your family has a reliable source of income and funds after you're gone. Getting a handle on how these pieces fit together is the first step to making smart choices for them.
The Three Pillars of Your Financial Safety Net
Your survivor benefits are built on three main pillars. Each one has a specific job to do, and knowing how they interact is key to a solid retirement strategy.
Survivor Annuity: This is the big one. It's the cornerstone of the whole system, providing a predictable, monthly check to your surviving spouse for the rest of their life. It’s essentially a portion of your own federal pension.
FEGLI (Federal Employees' Group Life Insurance): This program provides a lump-sum payment right after your death. It’s designed to help your family cover immediate, often large, expenses like funeral costs, outstanding medical bills, or paying down the mortgage.
TSP (Thrift Savings Plan): Your TSP account is likely one of your biggest financial assets. When you pass away, the balance in your account goes directly to the beneficiaries you’ve named, giving them a significant financial resource.
Think of it like a three-legged stool. The annuity offers steady, ongoing support. FEGLI provides a jolt of immediate stability. And the TSP delivers a substantial financial foundation. For a truly secure plan, you need all three legs to be strong.
Each of these pillars requires its own set of decisions. Electing a survivor annuity is a choice you make right at retirement. Your FEGLI coverage is something you manage during your career. And your TSP beneficiary is handled with a separate form that you should check and update regularly, especially after major life events.
To make this even clearer, the table below gives a quick snapshot of these core components and what they do.
Quick Overview of Federal Survivor Benefit Components
This table summarizes the primary types of survivor benefits available to federal employees and their families.
Benefit ComponentPrimary PurposeEligibility SystemSurvivor AnnuityProvides a continuous monthly income stream to a surviving spouse.FERS & CSRSFEGLIDelivers a one-time, lump-sum death benefit for immediate costs.All eligible employeesTSPTransfers your retirement savings account balance to beneficiaries.All eligible employees
Seeing them laid out like this really helps visualize how each part contributes to your family’s long-term security. They are separate benefits, but they’re designed to work as a team.
Choosing a Survivor Annuity Under FERS and CSRS
As you approach retirement from federal service, you’ll face one of the most lasting decisions of your career: the survivor annuity election. This isn't just another box to check on a form; it's the financial foundation you leave for your spouse. Think of it as purchasing an income insurance policy to protect them long after you're gone.
This single choice determines what portion of your pension your spouse will receive as a monthly check for the rest of their life. The rules are different depending on whether you're under the Federal Employees Retirement System (FERS) or the older Civil Service Retirement System (CSRS), so knowing which one you have is the first step.
The Survivor Annuity Options Under FERS
If you're under the more modern FERS plan, the decision is pretty straightforward. You have two main choices for a spousal survivor annuity, and each one comes with a cost—a permanent reduction to your own monthly pension.
Maximum Survivor Annuity (50%): This is the most common choice. It provides your surviving spouse with 50% of your full, unreduced annuity. To pay for this benefit, your own pension is reduced by a flat 10%.
Reduced Survivor Annuity (25%): This option provides your spouse with a smaller benefit of 25% of your unreduced annuity. The cost is also smaller—a 5% reduction in your monthly pension.
Of course, you can also choose to provide no survivor annuity at all. But be aware, this isn't a decision you can make alone. It requires your spouse's formal, notarized consent. Opting out also has a huge ripple effect, as it typically makes your spouse ineligible to continue their Federal Employees Health Benefits (FEHB) coverage after your death.
By electing a survivor annuity, you are essentially "buying" a future income stream for your spouse using a small portion of your current pension. The 10% or 5% reduction is the premium you pay for that lifelong financial protection.
So, which one is right for you? The answer depends entirely on your family's big-picture finances. You need to look at all the other income sources your spouse will have—Social Security, their own TSP or 401(k), investments, and so on. The goal is to piece everything together to ensure they have enough to live comfortably.
How CSRS Survivor Benefits Differ
For those tenured employees covered by the older CSRS system, the math is a bit more involved. Instead of picking a simple percentage, the benefit is calculated with a variable formula.
A full survivor annuity under CSRS is 55% of a "base amount." You get to decide what this base is—it can be your entire unreduced annuity or any smaller portion you designate at retirement. The cost is then calculated on that base: 2.5% of the first $3,600 of the base, plus 10% of whatever is left over $3,600. This gives CSRS retirees a lot more flexibility to customize the benefit, but it also means you have to run the numbers carefully.
Making sense of these options is the first step in planning. This infographic provides a great visual overview to get you started.
As the graphic shows, these benefits are a powerful and unique part of your federal compensation package. Taking the time to understand them is critical.
Real-World Implications of Your Choice
The value of these benefits can look very different between the two systems. FERS survivor benefits are often smaller on paper than their CSRS counterparts, but that’s by design—FERS employees also pay into Social Security, which provides its own survivor benefits. For context, a recent report found the median monthly FERS survivor benefit was around $560.
To keep up with rising costs, these annuities are adjusted for inflation. For 2025, all federal retirement annuities, including survivor benefits, received a 3.2% cost-of-living adjustment (COLA). You can dig deeper into these figures in the latest Congressional Research Service report.
Let’s put some real numbers to this to see how it plays out.
FERS Example:
Suppose your full, unreduced FERS pension is $3,000 per month.
If you choose the maximum 50% survivor benefit, your pension takes a 10% hit ($300). You'll receive $2,700 a month in retirement. When you pass away, your spouse begins receiving 50% of your original pension, which is $1,500 per month for life.
If you opt for the reduced 25% survivor benefit, your pension is only reduced by 5% ($150), so you’ll get $2,850 per month. Your surviving spouse would then get 25% of the original $3,000, or $750 per month.
Seeing the numbers in black and white makes the trade-off clear. You're accepting a little less money each month now to give your spouse a much larger, guaranteed income later. This decision is truly one of the most important financial gifts you can give your family.
Calculating Your Survivor Annuity Payments
Knowing the rules for survivor benefits is one thing, but seeing how they translate into actual dollars and cents is where the real planning begins. Let's get practical and run the numbers to see what these annuity payments could actually look like for your family.
The math isn't nearly as scary as you might think. At its core, the survivor annuity is simply a percentage of your own earned pension. By walking through a clear, hypothetical example, we can pull back the curtain on the process and give you a framework for figuring out your own situation.
A Practical FERS Annuity Calculation Example
Let's meet Alex, a retiring FERS employee. After a long career, Alex's full, unreduced annual pension works out to be $40,000. To make sure their spouse, Jordan, is well taken care of, Alex decides to elect the maximum survivor annuity.
Here’s how the calculation unfolds step-by-step:
Find the Survivor's Share: The maximum FERS survivor benefit is 50% of the retiree's full, unreduced annuity. For Alex, that’s 50% of $40,000, which comes out to $20,000 per year. This is what Jordan would receive annually after Alex is gone.
Break it Down Monthly: To see the monthly income, we just divide the annual amount by 12. So, $20,000 / 12 = $1,666.67 per month. That's a reliable, steady income Jordan can count on for life.
Account for the Cost: Of course, this valuable protection isn't free. Choosing the maximum 50% survivor benefit means Alex's own pension will be reduced by 10%. His new annual pension becomes $40,000 - $4,000 = $36,000, or $3,000 per month.
This is the central trade-off you have to weigh. Alex is choosing to receive a slightly smaller pension today to guarantee Jordan has a substantial, lifelong income tomorrow. It's about turning a piece of your personal retirement asset into a shared legacy of financial security.
It's also worth remembering that these payments aren't static. They are eligible for Cost-of-Living Adjustments (COLAs), which helps the benefit hold its value against inflation over time.
What if an Employee Dies Before Retiring? The Basic Employee Death Benefit
The survivor annuity is designed for employees who live long enough to retire. But what happens in the tragic event that a FERS employee passes away while still on the job? For this scenario, the system provides a different kind of support called the Basic Employee Death Benefit (BEDB).
This isn't an ongoing monthly payment, but a lump sum paid to the surviving spouse to provide immediate financial help. Think of it as a key part of the federal employee survivor benefits package for those who don't make it to retirement.
The BEDB is calculated in two parts:
50% of the employee's final annual salary.
A specific lump-sum amount set by the government, which is adjusted for inflation.
For example, if an employee's final salary was $80,000, the first part of the benefit would be $40,000. This amount is then added to the fixed lump sum for that year.
This benefit ensures that even if a career is cut short, the employee's family has a significant financial cushion to fall back on. To give you a sense of official figures, for a FERS employee with an unreduced annual benefit of $31,003.24, the maximum survivor annuity would be $15,501.62 per year, or about $1,292 monthly. For context on the BEDB, its fixed portion has been adjusted over the years and is set to be $42,607 in 2025. You can always find the latest details on how these amounts are determined directly from the Office of Personnel Management.
By running these numbers yourself, you can move from abstract percentages to tangible figures, giving you a much clearer picture of what your choices mean for your family's future financial plan.
How FEGLI and FEHB Complete Your Survivor Plan
A survivor annuity provides a steady, reliable stream of monthly income, but it's really just one leg of the stool when it comes to building a truly secure financial plan for your family. To create a complete safety net, you have to see how two other critical programs—Federal Employees' Group Life Insurance (FEGLI) and Federal Employees Health Benefits (FEHB)—fit into the bigger picture.
Think of your survivor plan as a layered defense. The annuity is your long-term income shield. But FEGLI and FEHB are there to handle the immediate financial shocks and protect against the single biggest expense most people face in retirement: healthcare. Without them, your family’s financial stability could be on shaky ground.
The Critical Link Between Your Annuity and Health Insurance
This is one of the most important, and frankly, most misunderstood aspects of federal employee survivor benefits: the direct line connecting your pension choice to your spouse's health insurance. For your spouse to keep their FEHB coverage after you pass away, you must have elected a spousal survivor annuity when you retired.
There's no way around it. This is an absolute, non-negotiable requirement. If you decide to waive the survivor annuity to get a bigger pension check for yourself, you are simultaneously shutting the door on your spouse's ability to stay in the FEHB program. That decision could force them onto the expensive and often confusing open market for health insurance.
Electing a survivor annuity isn't just about providing income; it's the key that unlocks continued access to affordable, high-quality healthcare for your spouse. This decision protects them from both financial hardship and potential health crises.
The federal benefits system is designed for these pieces to work together. The financial support from an annuity is deeply intertwined with health security through FEHB. A surviving spouse who qualifies for an annuity can almost always continue their health coverage, but if that benefit was never elected, they lose that priceless access. This is just one piece of a system that also includes life insurance and potential Social Security benefits. To get a better handle on how it all connects, it's worth exploring these five important facts for feds' survivor benefits.
FEGLI: Your Source for Immediate Financial Support
While your annuity is built for the long haul, FEGLI is designed to deliver a powerful, one-time cash infusion right when your family needs it most. This lump-sum death benefit is meant to cover the urgent, often unexpected costs that crop up immediately after a death.
FEGLI can give your survivors the breathing room to manage:
Final Expenses: Covering funeral arrangements, memorial services, and all the associated costs.
Medical Bills: Wiping out any lingering medical debts or co-pays.
Mortgage or Rent: Providing enough money to pay off the house or cover housing costs for a good long while.
Everyday Bills: Creating a cash cushion to handle daily expenses while they adjust to their new financial reality.
This immediate access to cash prevents your family from having to raid long-term retirement accounts or make stressful financial decisions while grieving.
Understanding Your FEGLI Coverage Options
FEGLI isn’t a simple, one-size-fits-all policy. It offers several layers of coverage that you can tailor to your family’s specific needs and your budget. Getting a handle on these options is key to building a plan that truly works.
FEGLI Coverage Tiers
Coverage TypeBenefit DescriptionKey FeatureBasic InsuranceYour annual salary rounded up to the next $1,000, plus an extra $2,000.Automatic for most new hires unless you actively waive it.Option A (Standard)A straight $10,000 death benefit.An easy, affordable way to add a fixed amount of coverage.Option B (Additional)Lets you buy coverage in multiples of 1, 2, 3, 4, or 5 times your annual salary.This is where you can build a massive payout; it's highly customizable.Option C (Family)Provides coverage for your spouse and eligible dependent children.Purchased in multiples to cover your whole family under one policy.
By strategically combining these FEGLI options with a survivor annuity and, crucially, ensuring FEHB can continue, you create a comprehensive and resilient financial plan. This approach takes care of both immediate cash needs and long-term income security, giving your family the ultimate peace of mind.
Managing Your TSP Beneficiary Designations
While your survivor annuity is designed to provide a steady, lifelong income for your spouse, your Thrift Savings Plan (TSP) is a different beast entirely. It’s a lump-sum asset, often one of the largest you'll accumulate in your entire federal career. Making sure this substantial nest egg lands in the right hands, without any hitches, is a cornerstone of a solid survivor plan.
Here’s a critical point that trips up far too many federal employees: they assume their will controls who gets their TSP money. That's a costly and heartbreaking mistake. In reality, your TSP account answers to one master, and one master only: the TSP-3, Beneficiary Designation form.
Think of the TSP-3 as the ultimate authority for your account. It's a direct order to the TSP that completely bypasses anything you've written in a will, a trust, or even a prenuptial agreement. If the person named on that form is an ex-spouse you divorced years ago, that’s exactly who will inherit the account—no matter what your will says.
The Power of the TSP-3 Form
Letting this simple form become outdated can have devastating consequences, sending your life savings to someone you no longer intend to provide for. That’s why checking your TSP-3 isn't just good financial housekeeping; it's a non-negotiable step to protect your loved ones.
It’s crucial to pull out that form and update it immediately after any significant life event.
Marriage: Make sure your new spouse is officially named.
Divorce: Remove your former spouse as a beneficiary right away.
Birth or adoption: Add your new child or dependent to your plan.
Death of a beneficiary: Reassign their portion to your other beneficiaries.
Taking a few minutes to do this ensures your legacy goes exactly where you want it to.
Spousal vs. Non-Spousal Beneficiaries
The person you name as your beneficiary will have very different options for handling the money they inherit. The rules for a surviving spouse are far more flexible than for a non-spouse beneficiary, like a child, sibling, or even a trust.
A surviving spouse gets the most leeway. They have several options:
Roll the inherited TSP into their own TSP account (if they're also a federal employee).
Move the money into their own Individual Retirement Account (IRA) to keep it growing tax-deferred.
Open a special "beneficiary participant account" directly with the TSP.
Take the money as a lump-sum cash payment (which can trigger a major tax bill).
The ability to roll the funds into another retirement account is a massive advantage only available to spouses. It allows the money to continue compounding tax-deferred for decades, preserving its wealth-building power for their own future.
On the other hand, a non-spousal beneficiary, like your adult child, has fewer choices. They can't just roll the money into their own IRA or 401(k). Under current inheritance rules, they are typically required to withdraw the entire account balance within a 10-year window, which can create a significant and often unexpected tax burden for them.
This distinction is why careful planning is so important. You can name anyone you like, but understanding the tax and financial impact on them is a key part of providing for them effectively. Keeping that TSP-3 form updated is the only way to guarantee your hard-earned savings give the maximum benefit to the people you care about. If you're trying to sort through these choices, the experts at Federal Benefits Sherpa can offer personalized guidance.
Watching Out for Common Survivor Planning Mistakes
When you're dealing with federal survivor benefits, the devil is truly in the details. It's easy to make small oversights that can create huge, often irreversible, problems for your family down the road. Knowing what pitfalls to look out for is the best way to make sure your plan actually works the way you want it to, giving you peace of mind and your family lasting security.
One of the most common—and devastating—mistakes we see is assuming your will or trust controls who gets your TSP money. That's a huge misconception. The TSP-3 Beneficiary Designation form is the one and only document that matters for your TSP account. It overrules everything else, including your will. If you don't update that form after a divorce or remarriage, you could accidentally leave your entire life savings to an ex-spouse instead of your kids or current partner.
Another critical error is not fully appreciating what you give up by waiving the survivor annuity. It's tempting to opt for a bigger pension check for yourself each month, but you have to think about what's really at stake for your spouse.
Choosing to provide at least a partial survivor annuity is typically the only way your spouse can continue their Federal Employees Health Benefits (FEHB) coverage after you pass away. Losing that access could throw them onto the private insurance market, which can be incredibly expensive, especially when they're already going through a difficult time.
Try to reframe the cost. It's not a "reduction" to your pension; it's the premium you pay for a policy that guarantees your spouse has affordable healthcare for the rest of their life.
A Quick Checklist for Staying on Track
Most of these mistakes don't happen because of bad decisions, but because of no decision at all. Being proactive is an act of love. Regularly checking in on your plan ensures it stays as strong and up-to-date as your commitment to your family.
Here’s a simple checklist to keep you from falling into common traps:
Check Your TSP-3 Form Every Year: Life happens. Pull out that beneficiary form once a year—or right after a major event like a marriage, divorce, or a new baby—to make sure it still reflects your wishes.
Run the Annuity Numbers: Don't just eyeball it. Calculate the exact impact of the survivor benefit reduction on your monthly income. Then, weigh that dollar amount against the priceless security it buys for your spouse.
Confirm Your FEGLI Coverage: Take a look at your Federal Employees' Group Life Insurance. Is the amount of coverage still right for your family? Your needs might have changed if you've paid down your mortgage or taken on new debts.
Talk About FEHB With Your Spouse: This is a team decision. Make sure your spouse understands how your annuity choice is directly tied to their future health insurance. You need to be on the same page.
By actively keeping an eye on these key areas, you can dodge the most frequent planning blunders. It turns the complicated world of federal employee survivor benefits into a clear, manageable path for protecting the ones you love. If you want a professional to look over your specific plan, the team at Federal Benefits Sherpa can help you spot any potential gaps.
Frequently Asked Questions About Survivor Benefits
Once you get a handle on the basics of federal survivor benefits, the specific "what-if" questions usually start popping up. It's totally normal to wonder how these rules apply to your unique family situation.
Let's walk through some of the most common questions we hear from federal employees to clear up the finer points.
What Happens if My Surviving Spouse Remarries?
This is a big one, and the answer hinges entirely on their age at the time of the remarriage.
If your surviving spouse gets remarried before they turn 55, the survivor annuity payments will stop. Simple as that. However, the story might not end there. If that marriage later ends due to death, divorce, or annulment, the original survivor annuity can often be turned back on.
But if the remarriage happens after your spouse is already 55 years old, their annuity check keeps coming without interruption. It provides that continuous financial support, regardless of their new marital status.
Can I Designate a Child for a Survivor Annuity?
Yes, you can, but it’s not the same as a spousal benefit. The mechanism for this is called an "insurable interest" annuity. It’s designed for someone, like a child, who has a clear financial dependence on you.
Just be aware that choosing this option comes at a cost—it triggers a much steeper reduction in your own pension than the standard spousal election. It's also worth remembering that your kids might already be covered. Eligible dependent children can often receive a separate children's survivor benefit if they are unmarried and under 18 (or under 22 if a full-time student, or of any age if they became disabled before 18).
Do I Have to Elect a Survivor Benefit for My Spouse?
If you're married when you retire, the default rule is yes. Federal law pretty much requires you to provide a full survivor annuity for your spouse. You can't just decide on your own to reduce it or waive it completely.
To make any change—either reducing the amount or eliminating it—your spouse must give their formal, written, and notarized consent. This is a crucial safeguard built into the system to protect a non-employee spouse from being left without financial security, sometimes without even knowing it.
How Do Social Security Survivor Benefits Interact with My Pension?
This is where things get really different depending on which retirement system you're in. The distinction is huge.
For CSRS employees: Your spouse's Social Security survivor benefit could be hit by something called the Government Pension Offset (GPO). This isn't a small adjustment; the GPO can dramatically reduce or even completely wipe out their Social Security payment.
For FERS employees: You can breathe a sigh of relief here. The GPO does not apply. Your surviving spouse can generally collect their full FERS survivor annuity and their full Social Security survivor benefits without one offsetting the other.
Getting this right is absolutely essential for anyone planning their retirement, but it's especially critical for CSRS families. The GPO can have a massive impact on your family's total income down the road, and you don't want any surprises.
Trying to piece all these rules together can feel like a puzzle with too many pieces. At Federal Benefits Sherpa, our job is to help federal employees see the full picture and build a retirement plan that truly protects their family. Schedule your free 15-minute benefits review today and get the clarity you need to provide lasting security for the ones you love.
