What Happens to My Military Pension When I Die?

Losing someone is never easy, and having to deal with complex financial and estate planning issues while still grief-stricken is a horrendous burden to bear. If you served in the military and are currently receiving a military pension, you may be wondering: What happens to your military pension after you die? Will your surviving spouse be looked after?

What Happens to a Military Pensions After the Recipient's Death?

In California, military service members who dedicated a minimum of 20 years of active duty service receive a pension for the rest of their lives upon retirement.

While the payment of this pension stops after the individual's death, they are eligible to purchase a Survivor Benefit Plan (SBP) where they pay premiums. These payments go towards ensuring your surviving dependents will receive a monthly income. The maximum amount that’s paid out to beneficiaries corresponds to 55% of the deceased’s retired pay.

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Who are Eligible Beneficiaries?

Currently, eligible beneficiaries include current and former spouses (provided that they have not remarried before the age of 55). It also includes dependent children, either as a separate package or in a combined package with the spouse.

The Importance of Estate Planning

Naturally, thinking about your own death and how to distribute your estate after you die is an extraordinarily unpleasant task. Many people prefer to ignore the looming topic of death for as long as possible.

Unfortunately, this can lead to many untold complications, especially in the event that you become too sick to represent yourself.

Estate planning is best done while you're still healthy and in a good frame of mind. By planning what will happen to your estate after you die, you protect your loved ones from having to deal with many practical and financial issues following your death.

Writing Up Your Will

Writing up a will is a significant part of estate planning, and a will should be revised often and thoroughly, particularly after major life changes like births, marriages, and divorces.

You can absolutely write your will yourself, but it can be helpful to have a partner like ClearEstate to guide you through the process and ensure your will covers all your bases.

Appointing an Estate Executor

When a will is drafted, the testator (the person who drafts the will) will usually assign a highly-trusted loved one to be their estate executor.

The role of the estate executor is to make sure that your estate is distributed according to your wishes. They oversee the estate settlement process and ensure that your assets are distributed among the named beneficiaries as you intended.

People often name their spouse or another trusted family member or loved one as their estate executor. However, when naming your estate executor, it's important to take their health and time availability into account. Will this person really be able to carry out this duty?

The Bottom Line

If you've served in the military for 20 years or longer, you may be receiving a military pension. While this pension stops in the event of your death, it's possible to purchase a Survivor Benefit Plan. This will contribute to protecting your loved ones after your pass.

There are several eligibility requirements to be able to avail of the benefits. Working with a partner like ClearEstate can help you securely plan ahead and protect your loved ones.