Military Survivor Benefits For Divorced Spouses
There is an option for military survivor benefits for divorced spouses, or SBP, which is analogous to a life insurance policy on the military retirement. Normally, retirement payments stop upon the death of the retiree, so without SBP, spouses or former spouses receive nothing after the retirees death. SBP, available for a monthly premium, ensures the continuation of payments.
Note also that legally permissible does not mean it will be awarded. Without several years of marriage, a family law judge may decide the former spouses insurable interest in the retirement is not high enough to justify ordering SBP coverage. But for a former spouse who risks losing the retirement should the retiree die, military survivor benefits for divorced spouses can be one of the more valuable former military spouse benefits. For more information about SBP in a divorce, read the Survivor Benefit Plan article in the Military Divorce Guide.
The Most Valuable Asset
Retirement benefits are usually the most valuable asset of marriages, often exceeding the value of all other assets combined including the equity in the marital residence. This is particularly true in military marriages, in which frequent moves are the norm.
Almost universally, pension benefits are recognized as community or marital property, including benefits that are still being earned . This is because the benefits accrued during marriage and future receipt of retirement income is actually a large part of the benefits earned by the labor performed during marriage.
Senior enlisted personnel frequently retire after 20 years of active service in their early forties and receive a lifetime pension of one-half their basic pay.This means a minimum of about $2,000 per month, every month, for life plus cost of living adjustments. These benefits are worth some half million to a million dollars or more in present value not including cost of living or inflation increases.
As a practical matter, you may need to deal with pensions during the divorce instead of deferring the matter to be dealt with later. Some states do not permit a partition action after divorce if the retirement is omitted from the divorce itself. Failing to fully address the retirement during the divorce could leave the spouse with no interest in the most valuable asset of the marriage.
Military Medical Benefits After Divorce
Health care is a hot issue, and after the military retirement itself, Tricare and 20/20/20 benefits are the most important available.
Military medical benefits are not a divisible asset – a former spouse who meets the statutory requirements has the right to receive Tricare, regardless of what the court orders at the time of divorce. And the opposite is also true – if the federal government determines that the former spouse is not entitled to such benefits, nothing a state court orders can change that.
Continued Health Care Benefit Program. After divorce, the former spouse is entitled to the Continued Health Care Benefit Program , which is the Tricare version of COBRA for three years. And as long as the spouse remains unmarried and was also awarded a share of the military retirement or SBP, the former spouse may remain on CHCBP for life. However, CHCBP is not cheap – in 2019 the program costs $1453/quarter for an individual, or $484/mo – it may well be cheaper to buy a health policy on the ACA health care exchange.
20/20/20 Benefits. This is the real deal – if the parties were married for at least 20 years, the military member served 20 years, and there were at least 20 years of overlap, an unremarried former spouse is a 20/20/20 spouse, entitled to Tricare health just as if the parties were still married – i.e. its cheap!
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Misconceptions About Military Divorce You Should Know
Deciding that it is time to get a divorce is one of the most difficult decisions that a person will have to make, and while it is often the best solution if a couple is facing irreconcilable differences, this does not make the divorce process any easier. In fact, navigating the divorce process can be overwhelming for many couples, and things only get more confusing if one or both spouses is a military service member.
Adding the complexities of military benefits and pensions on top of everything else that must be handled during a divorce can make an already complex process even more difficult. This is due to the fact that while each state sets its own divorce laws, benefits service members and their spouses are entitled to during and after a divorce are based on federal law. This can create a complex situation in which state and federal laws must both be navigated, which has led to a lot of misconceptions surrounding military divorces. If you are considering getting a divorce and you or your spouse is a service member, here is a look at the truth behind 5 common military divorce myths.
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When considering what a spouse may be entitled to receive in a divorce, the baseline consideration is the length of the marriage, the length of the service, and the overlap between the marriage and the military service. In order to retain any benefits, the marriage must have lasted at least 20 years and the service member must have served at.
The 20/20/20 rule means the full gauntlet of military benefits for divorced spouses are available to ID card holders. The former spouse retains an ID card and all benefits that go along with it, including Tricare medical, access to military installations, the commissary, etc. To qualify, the couple must have been married for at least 20 years.
Your surviving spouse may remarry after age 55 and continue to receive SBP payments for life. If your surviving spouse remarries before age 55, SBP payments will stop, but may be resumed if the.
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Your sponsor’s military Service Component is responsible for determining your continuing eligibility. If you and your sponsor are separated or living apart, but not divorced, you keep TRICARE benefits. After a divorce, you may be eligible for TRICARE coverage if you fit into one of the following scenarios:.
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Military Retirement & Divorce: The Marital Component Of Military Retired Pay
Make sure your client is prepared to prove when the military plan was funded. Any spouses retirement plan military or civilian could be funded before the marriage, after the marriage, or both before and after. Each retirement asset must be analyzed independently to determine its marital property component if any. In Arizona law, for example, the marital portion is a community asset to be divided equally between the spouses. Frequently, spouses are assisted by their attorneys in negotiating agreeable settlement terms for dividing the community property estate.
Consider this scenario: Both spouses have non-military retirement accounts from post-marital employment. Under the property settlement terms of their separation agreement, the wife shall keep 100% of her $50,000.00 IRA that was wholly funded with her earnings during their marriage. Husbands $500,000.00 401, funded with his wages before and after the marriage, shall be divided 60/40 with the wife receiving 40% . As mentioned in more detail below, such an agreement may not be permissible with military pension division where the spouse entered into service after September 8, 1980.
Since its passage, the USFSPA has been amended numerous times. One revision, particularly, has had a substantial impact on military pension division. In 2016, a federal rule changed how military retired pay is calculated prior to division in dissolution proceedings.
Military Id Cards And Other Benefits
Military ID cards cannot be ordered or decreed by a divorce court. Questions concerning eligibility should be directed to the nearest military ID card issuing facility. Generally former spouses are eligible if:
- The marriage lasted 20 years or more, AND
- The member served 20 years or more of service creditable for retired pay, AND
- The marriage and the creditable service overlap 20 or more years. .
- For additional information on the USFSPA, contact the nearest military legal assistance office.
For more information, view the USFSPA Trifold
The Retirement Benefits After Divorce My Spouse May Get
If you have some serious marital illness that you think can never be cured and it keeps creating regular issues between you and your spouse, then you might opt for a drastic solution. You may file for a divorce and put an end to your relationship. This way both of you can live a happy peaceful life ahead.
But while getting a divorce, you should always check whether or not your spouse has a claim on any of your retirement benefits after divorce. This is an important issue and couples who are in long marriages or individuals who have limited working years should look into this matter.
Here we will elaborate on the retirement benefits for divorced spouses. But first, we need a glance at the different retirement benefits.
Categories of retirement benefits for divorced spouses. Normally you can divide the benefits into 3 categories:
Now, lets put some light on the impact of divorce on your retirement benefits.
/10 Rule For Divorced Military Spouses
Now is a great place to note that if you are going through, or considering a divorce, its crucial that you understand the Uniformed Services Former Spouses Protection Act .
This federal law enacted in September 1982, recognizes the rights of a court to administer retirement pay to a former partner.
The USFSPA allows for a method of enforcing:
- Payments through the Department of Defense if a court awards a portion of the military members retirement pay to an ex-spouse.
- Court-ordered child support or
- Court-ordered alimony
Whats this have to do with the 10/10 rule?
The 10/10 rule comes into play by stating that the former spouse can receive a court-ordered portion of military pay from the Defense Finance and Accounting Service if:
The 10/10 rule can be confusing to understand. It does not delegate whether a former military spouse is eligible to receive a retirement check, only who sends it.
For more information on the 10/10 rule or how/when courts decide dividing a military members pension is necessary, click here.
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The 10/10 Rule And Military Pensions
In cases of dividing a military pension in a divorce, the 10/10 rule is a source of much confusion. Many people take this to mean that the spouse of a service member is only eligible to receive a portion of the retirement benefits if the marriage lasted at least ten years and at least ten of those years were spent in creditable military service.
That, however, is not the case.
Instead of dealing with whether or not one spouse can collect a portion of the military pension or not, the 10/10 rule simply establishes where the payment originates.
If you were married for ten years, and ten of those years counted toward the military retirement benefits, and that pension is later divided in a divorce, the payment will be delivered by the Defense Finance and Accounting Service. Otherwise, the checks come directly from the retired service member.
No two ways about it, when it comes to dividing up a military pension at the end of a marriage, its a tricky business. There are a number of factors to take into account. Despite falling under the umbrella of the USFSPA, the rules and regulations vary greatly from state to state. As is usually the case, its in your best interests to consult an experienced professional.
Calculating Marital Share For Active Military
There are different methods of calculating what percentage of the pension to which ex-spouses are entitled. The document filed with the court will need to clearly state the formula used to derive the amount of payment. Again, the length of the marriage will come into play. One of the more common trends is to count the number of points accumulated in the marriage rather than months. This is especially true for spouses serving in the Reserves.
The three methods used to determine the amount of payment are:
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Retirement Status At Time Of Divorce
The frozen benefit division rule is used to determine the military pensions value prior to its division in the divorce. Furthermore, the rule only applies to military spouses not yet receiving retired pay.
Is the service member already receiving retired pay from the military at the time of the divorce?
- Rule Does Not Apply: If the service member is retired and receiving retired pay at the time of divorce, then the frozen benefit division rule does not apply to the division of his or her military pension.
- Rule Does Apply: If the military spouse is actively serving and is not receiving retired pay at the time of divorce, then the frozen benefit division rule must be applied.
What follows is a breakdown of how the frozen benefit division rule typically works in the military divorce of an active-duty spouse.
Military Retirement After Divorce
The military offers its members a defined benefit pension, under which a member who serves at least 20 years will receive at retirement a monthly payment based upon the members years of service, basic pay, and a retirement multiplier.
The multiplier has traditionally been 2.5% x years of service , and that is still true for legacy retirement plans. However, for new members, as well as existing members who selected the blended retirement, the multiplier is now 2% x years of service, as there is also an enhanced Thrift Savings Plan available.
With a value in the hundreds of thousands of dollars, the military retirement is often the most valuable asset the spouses have accumulated during their marriage. It is a marital asset, subject to division at the time of the divorce or legal separation regardless of the length of the marriage – even if only a year or two! Note two caveats:
For a complete discussion of issues and formula for dividing a military retirement, see the Military Retirement section of the Military Divorce Guide.
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/20/20 Rule For Divorced Military Spouses
The 20/20/20 rule for military spouses touches on benefits that a military spouse may be entitled to even if they are no longer a dependent of a military member. These benefits include:
- Tricare health benefits
The 20/20/20 Requirements state that you must be:
If the criteria are met, the ex-spouse can receive Tricare for Life benefits.
Impact On The Survivor Benefit Plan
If a member voluntarily elects SBP coverage for a former spouse and that agreement has been ratified or approved by a court order, or, if the member has been ordered to elect SBP coverage for a former spouse, the retired member must make that election within one year of the date of the divorce. A former spouse, within one year of the date of divorce may submit to DFAS-CL a request that a “deemed” SBP election be established. If neither the Retired Soldier nor the former spouse requests former spouse SBP coverage within one year of date of divorce, former spouse coverage will not be established. A retired member cannot voluntarily elect nor can a court order former spouse SBP coverage if the retired member had not elected SBP spouse coverage at time of retirement.
SBP coverage for a former spouse will be no more than the amount of SBP coverage for the spouse.
A former spouse who remarries before age 55 loses SBP eligibility however, if the marriage ends in death, divorce, or annulment, eligibility is reinstated. A former spouse who remarries after age 55 does not lose eligibility.
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Career Under 20 Years
Though rare, a military member may occasionally be permitted to retire with fewer than 20 years of service . In such cases, a former spouse is NOT entitled to any benefits, regardless of how long the couple was married, because in both 20/20/20 and 20/20/15 the second prong, 20 years of service would not be satisfied.
Though a member taking early retirement is entitled to Tricare, and the spouse would be entitled if still married, the statute contains no exception to cover early retirement. There is no “20/18/18” rule for a former spouse, and no former spouse benefits absent at least 20 years of service.
How Long Does A Military Spouse Receive Pay After Divorce
If your former spouse is entitled to a portion of your military retirement pay, then they will continue to receive this payment until one of you passes away. If you die before your ex, then their benefits will stop. However, remarriage does not affect their right to a portion of your military pension if it was awarded in a divorce.
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