How Do You Chose the Correct Survivor Annuity?

by | May 4, 2018

Last Updated March 6, 2024

When faced with retirement, whether voluntary or disability, you must ask (and answer) many questions. One of them, and maybe an unpleasant one, is “Which survivor annuity should I elect?” It may help to think of a survivor annuity like life insurance. The purpose of a survivor annuity for FERS employees is to have the option to leave income to your surviving spouse.


There are three options to choose from, none, partial, or full.

No Survivor

If you choose this option, your paperwork must be signed and notarized by your spouse. The only thing your spouse would receive with this option is a refund of any unused FERS deposits (the total of the 0.8% you paid in minus the total of FERS benefits received).  If you don’t choose a survivor annuity, your spouse cannot continue FEHB after your death.

Partial Survivor

Choosing this option will reduce your annuity by 5% in return for a spousal benefit of 25% at your death. Your spouse’s signature and notarization are required for a partial benefit. Your spouse can continue FEHB coverage after your death with this option.

Full Survivor

This will reduce your annuity by 10% and give your spouse a benefit of 50% at your death. Again, your spouse will be able to continue FEHB coverage by choosing this option.

So, what if you outlive your spouse?

First, you will need to notify OPM of your spouse’s death to get your annuity changed back to 100%. You will also not get the 5 or 10% back that you paid in for a survivor annuity. Any past reduction in your FERS monthly benefit will be lost.


There is a default Cost of Living Adjustment associated with survivor annuities. FERS annuitants over the age of 62 receive a COLA, so that means the survivor benefit will increase along with that COLA. As your FERS annuity increases so does the survivor benefit.

Life Insurance or Survivor Annuity?

There are a few questions you should consider.

Does your spouse depend on your health insurance? If so, you must elect a survivor annuity.

Another point to consider is taxes. Survivor annuities aren’t taxed but premiums for life insurance are made in after-tax dollars. The opposite is true of the benefits of each. Survivor benefits are taxable income and life insurance proceeds are income tax-free.

Other factors can also come into play; age, health, children, etc.

It’s an important decision that needs to be carefully thought out and planned.

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