What Is the Survivor Benefit Plan for Military Retirees?

The Survivor Benefit Plan for military retirees is a Department of Defense program that continues a portion of your retired pay to your surviving spouse, children, former spouse, or another eligible beneficiary after you die. You pay a monthly premium out of your retired pay while you’re alive, and your survivor receives 55% of the base amount you chose.¹ It is governed by 10 U.S.C. §§ 1447–1455, and if you are married when you retire you are enrolled automatically at the maximum level unless you take affirmative steps to change that before your retirement date.²

Enrollment Is Automatic Unless You Act

If you are married or have eligible children on your retirement date and no valid SBP election reaches DFAS by that date, full spouse-and-child coverage takes effect by default. Doing nothing is itself an election.²

To choose something other than the default, you file DD Form 2656 (“Data for Payment of Retired Personnel”) through your branch’s finance center before retirement. The form is available on the DFAS website as an interactive wizard or a downloadable PDF.³ You pick who is covered and a base amount, which can be set anywhere from a minimum of $300 up to your full monthly retired pay. Both your premium and your survivor’s annuity are calculated from that base amount.

Any election below maximum spouse coverage requires your spouse’s written concurrence on DD Form 2656, notarized or witnessed by a designated military official. Without that concurrence, DFAS treats the election as invalid and defaults to full spouse coverage.⁴ Late elections are generally not accepted unless Congress opens an enrollment window, so treat your retirement-date decision as permanent.

Once DFAS processes the paperwork, you’ll get a Retiree Account Statement confirming coverage and the premium being deducted. Keep it. Your survivor will need it eventually.

Who You Can Cover

You can only cover one beneficiary category at a time, with one combined option for spouse and children.

Spouse only, which is the most common election. The annuity runs for the spouse’s life, subject to the remarriage rule below.
Spouse and children, where children become the beneficiaries only if the spouse dies first or loses eligibility.
Children only, with eligible children sharing the annuity and no spouse coverage.
Former spouse, either voluntarily elected by the retiree or requested by the former spouse under a court order. A former-spouse “deemed election” must reach DFAS within one year of the divorce decree.⁵
Insurable interest, available when you have no eligible spouse or children. A relative closer than a cousin qualifies automatically; anyone else must document a financial stake in your continued life.

A child counts as eligible while unmarried and under 18, or under 22 if enrolled full-time at an accredited school. Marriage at any age ends a child’s eligibility. A child who is incapable of self-support because of a disability that began before age 18 (or before 22 while a full-time student) remains eligible for life so long as the disability and unmarried status continue.⁶ If a disabled child would lose means-tested benefits like Medicaid or SSI on receiving the annuity, payments can be routed into a Special Needs Trust; that designation is irrevocable.⁷

What It Costs

Premiums come out of your gross retired pay before federal income tax, so they reduce your taxable income. What you pay depends on the beneficiary category and base amount.

Spouse or former-spouse coverage runs 6.5% of the elected base amount as a flat rate.⁸ Retirees who came in before March 1, 1990, disability retirees, and reserve-component retirees may qualify for a two-tier formula (2.5% of an annually adjusted threshold amount, plus 10% of the remainder). DFAS applies whichever formula produces the lower premium.⁹ In practice, a $2,000 base amount at the flat rate is $130 a month, and the pre-tax deduction means your take-home drop is smaller than that figure.

Children-only premiums are not a flat percentage. They are set from actuarial tables based on your age and the age of your youngest child, and they end when the last child ages out. A 50-year-old retiree with a 14-year-old would pay roughly $2.90 per $1,000 of covered retired pay.⁶

Insurable interest coverage is expensive. It starts at 10% of gross retired pay and adds 5% for every full five years the beneficiary is younger than you, up to a 40% cap.¹⁰ For many people a private life insurance policy will be cheaper.

Premiums do not run forever. Coverage is considered paid up once you have made 360 monthly payments and reached age 70. Both conditions must be met. After that the premiums stop and the survivor’s coverage continues unchanged.¹¹ Someone who retires at 42 hits paid-up status at 72; someone who retires at 55 has to wait until 85 to complete the 30 years.

What Your Survivor Receives

The annuity is 55% of the base amount you elected.¹ With full coverage on $4,000 in retired pay, the survivor receives $2,200 a month. Reduce the base to $2,000 and the annuity drops to $1,100.

The annuity gets the same annual cost-of-living adjustment as military retired pay, tied to the Consumer Price Index. The 2026 COLA is 2.8%.¹²

The annuity is subject to federal income tax, even though the premiums that funded it were pre-tax. DFAS collects a W-4P from the survivor and withholds accordingly.¹³ The 55% figure is a gross number, not what actually lands in the bank account.

Reserve Component Retirees

If you earned a reserve retirement but aren’t yet drawing pay, the SBP decision comes with your 20-year letter, not at age 60. You have 90 days to opt out; if you do nothing, you’re enrolled automatically.²

Reserve members choose whether the annuity would begin immediately on death or on what would have been the retiree’s 60th birthday. The immediate option protects a younger survivor better but costs more. The reserve-component annuity is calculated at a reduced percentage that reflects the different actuarial basis.¹

Life Changes That Reopen the Election

A few post-retirement events create a limited window to adjust coverage.

Marriage after retirement: one year from the marriage date to elect spouse coverage in writing.²
Acquiring a first eligible child after retirement (birth, adoption, or stepchild): one year from the date you gain the child.¹⁴
Divorce where a court order awards the annuity: the former spouse’s deemed election must reach DFAS within one year of the order.
A spouse’s death, a child aging out, or any other eligibility change: notify DFAS so premiums and coverage adjust.

Congress occasionally opens an SBP season that lets retirees enroll or discontinue coverage. The most recent one ran from December 23, 2022, through January 1, 2024, under the FY2023 National Defense Authorization Act.¹⁵ These windows are rare and unpredictable.

SBP, VA DIC, and Remarriage

Surviving spouses who qualify for both SBP and the VA’s Dependency and Indemnity Compensation used to have their SBP annuity reduced dollar-for-dollar by the DIC amount. That offset was fully eliminated on January 1, 2023, under the FY2020 National Defense Authorization Act. Survivors now receive both payments in full.¹⁶ SBP payments are federally taxable; DIC payments are tax-free.¹³

Remarriage matters. A surviving spouse who remarries before age 55 loses SBP payments, though they can be reinstated if that marriage ends by death or divorce. Remarriage at 55 or older has no effect on the annuity.⁹ Worth discussing with your spouse now, not later.

How Your Survivor Files the Claim

After the retiree’s death, the beneficiary starts payments by filing DD Form 2656-7 (“Verification for Survivor Annuity”) with DFAS, either through the online wizard or on paper. A copy of the death certificate showing cause of death, an IRS W-4P for tax withholding, and a direct deposit form (FMS 2231 or SF 1199A) go in with it. Minor children need a custodianship certificate (DD Form 2790), and student beneficiaries between 18 and 22 need a school certification (DD Form 2788).¹⁷

1
Office of the Law Revision Counsel. 10 USC 1451 – Amount of Annuity
2
Office of the Law Revision Counsel. 10 USC 1448 – Application of Plan
3
Defense Finance and Accounting Service. Retired and Annuitant Pay Forms Library
4
Defense Finance and Accounting Service. Survivor Benefit Plan Coverage Options
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Defense Finance and Accounting Service. Spouse or Former Spouse SBP Coverage RAS
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Military Compensation and Financial Readiness. Survivor Benefit Program Children Only
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Defense Finance and Accounting Service. Special Needs Trusts
8
Office of the Law Revision Counsel. 10 USC 1452 – Reduction in Retired Pay
9
Military Compensation and Financial Readiness. Survivor Benefit Program Spouse Coverage
10
Department of the Air Force Retirees. SBP Coverage Costs
11
Military Compensation and Financial Readiness. Paid-up Survivor Benefits Program
12
Defense Finance and Accounting Service. 2026 COLA for Military Retirees and SBP Annuitants
13
Defense Finance and Accounting Service. Who Pays SBP and Who Pays DIC
14
Air Force Retirees. Child-only SBP Coverage
15
Defense Finance and Accounting Service. SBP Open Season Allows Retirees to Enroll or Discontinue SBP Coverage During 2023
16
Defense Finance and Accounting Service. SBP DIC News
17
Defense Finance and Accounting Service. Start an SBP Annuity