A little more money in your retireee paychecks?

[VAK]

Here's a little bit of good information and a touch of Congress and the President following through on a promise made. Also in the works are some changes soon to be announced regarding a myriad of other benefits so keep watching and I will update you as we keep the on going negotiations alive... In my entire life, this may be the most satisfying start to a legislative season for Veteran's, Active Duty, Guardsmen and Reservist's alike. (It seems there is only one major obstacle to most things, though he should be one of the greatest advocates for the military... And even he's been somewhat muzzled.) So, keep the faith as we see a good year ahead.


Release No. 11-13-04
Nov. 30, 2004

SSBP payments end; coverage remains

Some military retired members will see more money in their Dec. 1 paychecks.

They're the ones who, beginning with the 1992-93 special Survivor Benefit Plan (SBP) open enrollment period, signed up for the Supplemental SBP coverage (SSBP). Retired members who took the SSBP coverage at that time and members retiring later who elected the coverage have been paying higher premium than those who remained with the standard SBP.

Originally, at age 62, the SBP annuity is reduced from 55 percent to approximately 35 percent. Beginning with the 92-93 open season, retired members could ensure the annuity remained at 55 percent or a lesser annuity in 5 percent increments down to 40 percent with a variable SSBP cost.


On Oct. 28, 2004, President Bush signed Public Law 108-375, the Ronald W. Reagan National Defense Authorization Act (NDAA) for Fiscal Year 2005. Section 644 of this Act terminates costs for the SSBP elections effective Nov. 1, 2004.

For those with the SSBP, this means:

* Your current level of SSBP coverage will continue but you will no longer be charged any SSBP costs.

* Your basic Survivor Benefit Plan (SBP) coverage and costs (generally 6.5 percent of gross retired pay) remain unchanged.

* Your Dec. 1, 2004 retired pay will be increased by the amount you were paying for the SSBP coverage, less federal income tax.

Retired members affected by the change will receive a Retiree Account Statement soon which shows new SBP costs, the new adjusted taxable income, adjusted Federal Income Tax Withholding and increased net retired pay.

Information will be available through the Internet at http://www.dfas.mil. You may also contact DFAS by phone at 1 (800) 321-1080 or write to Defense Finance and Accounting Service, US Military Retirement Pay, PO Box 7130, London, KY 40742-7120.

The same law will gradually eliminate the age 62 offset for surviving spouses of retired members who have not elected SSBP. The phase in to full SBP 55 percent payments start Oct. 1, 2005 when it will increase to 40 percent; then on April 1, 2006, it will become 45 percent; 50 percent on April 1, 2007 and 55 percent on April 1, 2008.