Financial Resources for Military Families Who Lost a Loved One
Updated on May 16 2019
Freedom is certainly not free and for those families who have had a loved one give the ultimate sacrifice, it can be devastatingly costly. In addition to the emotional trauma that losing a loved one has, it can also be a financially scary time for families who have lost a provider.
In honor of Memorial Day and those who have died in service to our country, explore these financial resources for military families who have lost their service member.
Financial Benefits for Survivors
Here are some veteran’s benefits available to help military families cope with the lost of a loved one:
Servicemembers’ Group Life Insurance (SGLI)
Servicemembers’ Group Life Insurance, most commonly known as SGLI, is a program from the Department of Veterans Affairs that provides low cost life insurance to military members. For $29 per month, military members receive $400,000 in life insurance. SGLI includes Traumatic Injury Protection with coverage for that ranging from $25,000 to $100,000. SGLI is only for active duty military and stays in effect for 120 days after the servicemember leaves the military.
Veterans Group Life Insurance (VGLI)
Similar to SGLI, Veterans Group Life Insurance allows servicemembers to convert their SGLI coverage to renewable term insurance. After discharge from the military, veterans have one year and twenty days to apply for VGLI. After this period, they are no longer eligible for the program. VGLI coverage is issued in multiples of $10,000 up to $400,000.
Social Security Survivors Benefit
Although not specific to military families, the Social Security Survivors Benefit is paid to spouses and children of workers who pass away. Widows and widowers can get full benefits at full retirement age and reduced benefits as early as age 60. The amount depends on an average lifetime earnings and the more a person has earned the more their benefits will be. Learn more about the SS Survivor’s Benefit.
Survivor Benefit Plan (SRB)
The Survivor Benefit Plan is an annuity program that allows service members to place a portion of their retired pay to a spouse or other eligible beneficiary after their death. Veterans with a spouse or child are automatically enrolled in SRB at the maximum level. Additionally, active duty service members are also automatically enrolled at no cost.
Tax Forgiveness and Extensions
Tax liability, the entire sum of money paid annually in taxes to the federal government can be forgiven or refunded if a service member dies while on active duty in a combat zone, from wounds, disease, or injury received in a combat zone, or from wounds or injury incurred in a terrorist or military action. This is through the Tax Forgiveness and Extensions plan. The tax years forgiven depends on the circumstances surrounding the death.
Survivors of the deceased may qualify for a tax filing extension for up to 180 days from the last day the service member was in a combat zone, served outside the combat zone, or served in a contingency operation.
Just as important, if not more so, the military and the Department of Veterans Affairs also offers emotional support for families who have lost a service member. Each branch of the Armed Forces has a program that provides long-term support services to families of deceased service members. There are also counseling options available through MilitaryOneSource, Veterans Affairs, and TRICARE.
An expert fiduciary financial advisor can also help navigate personal finances to make sure your future is set up for success.
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