Any money you have in your TSP account would be paid out according to the name(s) you designated. Image: terazitu/Shutterstock.com
By: FEDweek StaffWhile it’s clearly not a pleasant topic, both you and your spouse should have a solid understanding—for financial planning and other purposes—of the benefits that would be payable on your death while a federal employee. Here are some major points.
Survivor Annuity
If you have at least 18 months of creditable service when you die, your spouse will be entitled to a survivor annuity. That annuity will be a percentage of the annuity you were entitled to as an employee. If you are retired, it will be the amount you were receiving as an annuitant. In either case, if you are a FERS spouse, that’s 50 percent. For a CSRS spouse it’s 55 percent. However, if your spouse agreed to a lesser annuity amount (or none at all) when you retired, that agreement will determine the amount of the spousal annuity. Note: While retiring FERS retirees wanting to select a lesser amount have only one option – 50 percent, CSRS employees with their spouse’s consent can designate any amount between $1 and the full survivor annuity.
If you are a FERS employee, your spouse would also be entitled to a basic death benefit, plus 50 percent of either your final salary or your high-3, if that’s higher. In 2025 that amount is just over $42,600.
Health insurance
If you were enrolled is the Self Plus One option when you died, the person who shared your enrollment can continue that coverage. The same is true of any eligible survivors if you were enrolled in the Self and Family option.
Your survivor would be entitled to the same benefits and government share of the contributions as any current or retired employee enrolled in that same FEHB plan. The premiums for that coverage would be deducted from the survivor’s annuity unless the annuity was too small to cover the cost. If that was the case, your survivor could arrange to pay the premiums directly to the plan.
Life insurance
If you elected to be covered under the Federal Employee’s Group Life Insurance program and filled out a Standard Form 2823, Designation of Beneficiary, any FEGLI benefits will be paid to those you named. If you don’t have a designation on file, the proceeds of your insurance will be distributed according to the standard order of precedence:
• first, to a surviving spouse;
•second, if none, to your child or children, with the share of any deceased child distributed among the descendants of that child, if any;
•third, if none of the above, to your parents in equal shares or in its entirety to the lone survivor;
•fourth, if none of the above, to the executor or administrator of your estate; and
• fifth, if none of the above, to your next of kin as determined under the laws of the state where you lived.
Other Insurance
If your spouse or any eligible family member was enrolled in the Federal Long-Term Care Insurance Program when you die, that enrollment can continue as long as the family member(s) pay the premiums. Note: The opportunity to enroll in the FLTCIP program for the first time would only be available to a family member who is receiving a survivor annuity; new FLTCIP enrollments are not allowed through the remainder of this year in any case.
Any family member who was covered under your enrollment in the Federal Dental and Vision Insurance Program can continue that coverage. And anyone receiving a survivor annuity can enroll in the program if they want to.
Thrift Savings Plan
Any money you have in your TSP account would be paid out according to the name(s) you designated. If you didn’t make such a designation, the payout will follow the standard order of precedence spelled out above.
If your survivor spouse is the beneficiary, he or she can keep the account open and enjoy the same management and withdrawal rights that you did. If there are any other beneficiaries, the account will have to be closed. At that point they can either withdraw the money or transfer it to individual retirement accounts (IRAs) or other qualifying retirement savings plans.
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