Military families need to consider special estate-planning issues that others do not. This is particularly true when one or more family members are deployed overseas. Beyond this, members of the military have access to special benefits and resources. This can become complicated and, for this reason, it is important to seek special help if you are a military family. Whether you are just starting your service in the military or have been serving for some time, consider the following common factors that may be important in your estate planning:
- You own real property and, if so, if it is located in different states
- You are married
- You have minor children, or children with special needs
- You have money set aside in 401(k), IRAs, or thrift savings plans
- You are moving multiple times across states or to different countries
There are many benefits offered to military families that can help with estate planning. These include:
Life insurance
Life insurance is an important part of an estate plan intended for those who are financially dependent upon you, especially if you are facing deployment. Active-duty members have access to low-cost life insurance for themselves and their loved ones from Service Members’ Life Insurance Group.
Will
A will is a crucial document outlining to whom and how you want your property distributed at your death. It also allows you to name who will administer your estate and specify who will care for a minor or special needs children.
Trust
A trust is a separate legal entity that can hold property and assets for the benefit of one or more people or entities. Similar to a will, a trust allows you to dictate who will receive your property at your death and how it is to be administered. The added benefit of a trust is that it also provides instructions on how to handle the assets during any period of your incapacity. For most families, a trust-centered estate plan is a better fit, but a will can work for some families.
Other benefits for survivors
Survivor benefit plans (SBP) are pension-type plans in the form of an annuity that will pay your surviving spouse and children a monthly benefit at your death. Likewise, dependency and indemnity compensation (D&IC) provides a monthly benefit to eligible survivors of servicemembers or veterans (1) who die while on active duty, (2) whose death is due to a service-related disease or injury, or (3) who are receiving or entitled to receive VA compensation for a service-related disability and are totally disabled.
Members of the military often experience frequent moves, have access to several forms of government benefits after service, and can be subject to some unusual tax rules. For these reasons, estate planning for military families is more complicated than most. We are here to guide you through the best options available to you and your family.