I FIRED about 2 years ago and have been enjoying it very much, but money had to be watched fairly close. I just turned 60 and am now getting my Navy Pension. The good news is that money now is not tight at all! But I was shocked at what the Survivor Benefit Plan (SBP) is costing.
I had thought it would be about 6.5% but its over 8.25% as a Reserve cost is added on. In short, I'm paying $250/mo for a $1600/mo benefit.
At this moment, my wife and 2 kids (15 yr old) could use the benefit (and I have no choice for 2 years as I can't decline it until then). But if I live until 70 there will no need for it (kids done with college, house paid for, wife could take my SS if I pass on) but I will be stuck paying for it another 20 years.
All I would need is about $300,000 in term life insurance for 8 years (62-70). If I can find it for the same amount as my SBP payment would that not be a better choice?
I don't need convincing but my wife does. Please let me know what you would do in this circumstance. Would help in convincing the DW.
I had thought it would be about 6.5% but its over 8.25% as a Reserve cost is added on. In short, I'm paying $250/mo for a $1600/mo benefit.
At this moment, my wife and 2 kids (15 yr old) could use the benefit (and I have no choice for 2 years as I can't decline it until then). But if I live until 70 there will no need for it (kids done with college, house paid for, wife could take my SS if I pass on) but I will be stuck paying for it another 20 years.
All I would need is about $300,000 in term life insurance for 8 years (62-70). If I can find it for the same amount as my SBP payment would that not be a better choice?
I don't need convincing but my wife does. Please let me know what you would do in this circumstance. Would help in convincing the DW.