Reserve Component Survivor Benefit Plan

Selecting your Reserve Component Survivor Benefit Plan is an important decision when you retire from the Reserve or National Guard. Learn how your choice affects your beneficiaries.

As you retire from the National Guard or Reserve, you probably find yourself reflecting on the challenges you endured, like countless fitness tests and deployments all while juggling two careers. But it’s also time to think about the future and consider your options when it comes to the Reserve Component Survivor Benefit Plan, or RCSBP.‍ ‍ ^{See note 1} The RCSBP, like the active-duty Survivor Benefit Plan (SBP), lets you pass a portion of your retirement paycheck to your chosen beneficiary when you die.

But there are some differences between the RCSBP and the SBP. The biggest lies in the "gray" period — the time between when you retire and when you are eligible to receive your military pension, usually around age 60. If you die during this gray period, the choice you make now will determine if and when your designated beneficiary will receive the survivor annuity.

When you retire from the Reserve or National Guard, you'll have three options available to you.

Option A

This allows you to defer your RCSBP selection until your military pension begins, which can be beneficial to those who retire without an eligible beneficiary. It also allows you to designate one later — a benefit that will come in handy if you marry after military retirement. The downside to Option A is that if you die before age 60, when you make your selection, you lose the benefit permanently.

Option B

If you select this option at the time of your retirement but die before your military pension begins, your beneficiary will receive the survivor pension when you would have turned 60. Unfortunately, it could be years before they receive that money, which could impact their present financial security.

Here’s an example to help illustrate this point. If your family is dependent on your income and you die at age 50, that would leave them 10 years to provide for themselves until your military pension would begin. I didn’t choose this option simply because if I died today, a promise of future money would not help my family when they needed it.

Option C

With this option, the survivor pension starts immediately upon your death, regardless of your age. This is the option that ensures your beneficiary immediately begins to receive a steady stream of income to offset lost income due to your death. It’s also the default option if you don’t make an election.

However, this option costs a bit more than Options A and B since your family would receive the benefit before your military retirement would have started.

This option is similar to an immediate annuity. You give a lump sum of cash and receive payments for life or a chosen period of time. But in this case, you haven’t paid with cash but with military service.

This is the option I personally chose when I retired from the Reserve and what USAA recommends for most people. Each person must decide for themselves, but in general, Option C is the best option to help provide for your family financially. That's why I chose it — if I die today, my family needs income today, not in the future.

Keep in mind that the list of eligible beneficiaries ranges from a spouse to a "person with an insurable interest." So read the list carefully to make sure this benefit passes to someone who is financially dependent on you.

RCSBP is just one of many decisions you need to make as you leave the military. That's why USAA has a complete experience dedicated to guiding your transition from military to civilian life. It includes our military separation assessment, checklist and job hunting tools, all designed to help you transition to full-time civilian life with as little stress as possible.