Expert's View

Do you know who will be entitled to your Federal Employees Group Life Insurance (FEGLI) policy proceeds or to the money in your Thrift Savings Plan (TSP) account on your death? It’s important to know the answer to that question, but in the midst of a pandemic and what seems like a new natural disaster every time one looks at the news that question seems to come into sharper focus for some.

That said, when did you last check to see who would benefit from your FEGLI and TSP benefits on your death? If you’re like most federal employees, you filled out a designation of beneficiary form when you first entered government—and may not have changed it since then. If that’s true for you, you need to go to your servicing personnel office, look in your Official Personnel File (OPF), and make sure that those you designated back then are still the ones you want to receive the benefits.

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It’s a sad fact of life that the names in your OPF aren’t always the one(s) you would have picked if you were still alive. This is especially the case with FEGLI. That’s because you were automatically covered by that benefit on the first day you entered government service. If you didn’t decline that coverage and haven’t changed your designations since then, the name or names you put down (or their heirs) will get that benefit, not the one or ones you would want to get them today.

To give just one example, you may since have been divorced from your spouse at the time. But if he or she is still listed as the beneficiary, that’s where the money will go. (What happens to those benefits may have been settled by a court order – or not. It’s up to you to know for sure.)

The same is largely true of the TSP. You may have filled out that form when you first started investing through that program (which for the last 15 years or so has been automatic on hiring). At that time, you may only have had lunch money in that account and the beneficiary may not have mattered much to you. But now you might have tens or hundreds of thousands of dollars in it and you’ll want to take more care with where that money would go.

To change a FEGLI designation, you’ll need to fill out a Standard Form 1823. The form for changing a TSP designation is the TSP-3. Both forms are available from you personnel office or you can download them by going to OPM’s website at www.opm.gov and click on Forms or TSP’s website at www.tsp.gov and click on Forms & Publications.

Now, if you never filled out a designation of beneficiary form for either FEGLI or the TSP, when you die those benefits will be distributed according to what’s called the standard order of precedence:

• your spouse; then

• your child or children in equal shares, with the share of any deceased child distributed among the descendents of that child; then

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•your parents in equal shares or the entire amount to the surviving parent; then

•the duly appointed executor or administrator of you estate; then

•your next of kin under the laws of the place you were living at the time of your death.

Have you checked your OPF to see who would benefit if you die?

Children’s Benefits – Life Insurance and Annuities

Children’s Benefits – Health Insurance

Benefits if You Leave Government before Retirement Eligibility

Decisions, Decisions on Insurance – FEGLI

Decisions, Decisions on Insurance – FEHB

Your OPF Is Your Retirement Backbone

FERS Retirement Guide 2021