How much does the Survivor Benefit Plan (SBP) cost?
SBP usually costs no more than 6.5 percent of your pay, before taxes. This is the cost to cover your Spouse or Former Spouse. To add coverage for children, you must pay a small additional charge based on the youngest child’s birthdate. Coverage for only your children will cost much less than coverage for a spouse and be based on the youngest child’s birthdate. If you have no eligible spouse or children, and you choose to provide coverage to someone with an insurable interest, the cost will be 10 percent of your pre-tax pay. Is SBP adjusted to compensate for increases in the cost of living? Yes. This feature helps keep SBP’s purchasing power in step with tomorrow’s dollar value. All features of SBP are increased by the same percentage as the retiree Cost of Living Adjustment (COLA). The ratio of cost to benefit is constant.
