Death Before Retirement
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![Page 1: Death Before Retirement](https://reader030.fdocuments.us/reader030/viewer/2022032604/56812b0e550346895d8efeed/html5/thumbnails/1.jpg)
Death Before RetirementDeath Before Retirement
-The Facts-
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Meet BillMeet Bill
• Age 52
• BYU Faculty for 20 years
• $54,000 Salary
• $4,500/month
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Meet Bill’s FamilyMeet Bill’s Family
• Spouse is 49 years old
• Three children, ages 22, 18, and 15
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During a church basketball game the unthinkable happens . . .
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What income is available for What income is available for Bill’s family?Bill’s family?
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Life Insurance PayoutLife Insurance Payout
Paid to beneficiary (spouse) – no taxes
• Group Term Life $50,000
• Supplemental GTL 6 x salary =
$360,000
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SavingsSavings
• Estimated Accumulations– 3% salary increases– 5% savings + 4% match– 20 years
Total = $169,339• Transferred to primary beneficiary
(surviving spouse)
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Master Retirement (MRP)Master Retirement (MRP)Qualified Joint Survivor Annuity (QJSA)
if taken at employee’s age:
Age 55 (first available) Age 65
63% for additional years 100% no additional years
95% for two-life 95% for two-life
50% for spouse 50% for spouse
$381.19 $605.06
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Social SecuritySocial Security
Death Benefit $255
Spouse caring for child until dependent turns 16
$1,218/month
Child benefit from age 16 to 18 or until high school graduation
$1,218/month
Family maximum $2,848/month
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Social SecuritySocial Security
Option 1
Age 60
Option 2
Age 66
Retirement Benefit $1,161/mo. $1,624/mo.
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What benefits are available for What benefits are available for Bill’s family?Bill’s family?
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Family Medical/Dental InsuranceFamily Medical/Dental Insurance
• Medical/Dental Insurance provided at no cost for a one-year period
• Changed to name of surviving spouse
• Dependent coverage during year limited to age 26, marriage, or employment with insurance
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Family Medical/Dental InsuranceFamily Medical/Dental Insurance
• After one year of coverage:– Because Bill has twenty or more years of MRP
benefit credit:• Coverage continues and BYU pays its full part
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Family Medical/Dental InsuranceFamily Medical/Dental Insurance
• If after one year of coverage:– Bill had more than ten years, but less than
twenty years of MRP benefit credit:• Coverage may continue and premiums are prorated
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Family Medical/Dental InsuranceFamily Medical/Dental Insurance
• If after one year of coverage:– Bill has less than ten years of MRP benefit
credit:• Spouse and dependents are not eligible for
continuing coverage
• COBRA is an option for up to 36 months
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Family Life Insurance CoverageFamily Life Insurance Coverage
Before After
Surviving Spouse
$2,000 GTL
$200,000 SGTL$5,000 SGTL
Dependents$2,000 GTL
$10,000 SGTL$5,000 SGTL
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Family 24-Hour AD&DFamily 24-Hour AD&D
Before After
Employee 0 to $400,000 -0-
Spouse 0 to $160,000 -0-
Dependents 0 to $20,000 -0-
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Tuition for SpouseTuition for Spouse
• Full-time benefit continues
• Benefit not extended to new spouse and step children if new marriage
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Tuition for DependentsTuition for Dependents
• Changes from ½ tuition to full tuition
• Benefit continues if accepted to BYU-Provo or BYU-Idaho until the child:– Obtains a Bachelor’s Degree from any
university or college or– Completes 152 semester hours at BYU or– Reaches Age 30
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Strategy for Use of BenefitsStrategy for Use of Benefits
Group Term Life $50,000
• Pay burial expenses
• Pay other family debts
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Spouse’s Monthly IncomeSpouse’s Monthly IncomeMoney invested at 6% or single
premium life annuity paying at 6%
SGTL $360,000 $1,800
Thrift $169,339 $847
Total $529,339 $2,647
Social Security
Social Security for Spouse until child is age 16
$1,218
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Additional Monthly IncomeAdditional Monthly Income
Option 1 Option 2
MRP At age 52 $381 At age 62 $605
Social Security Retirement
At age 60 $1,161 At age 66 $1,624
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What if Bill had been age 55?What if Bill had been age 55?
Not Retired Retired
Life Insurance $410,000 $12,000
Master Retirement $470/mo. $871/mo.
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• Take time to review your benefits package– Make sure your beneficiaries are updated
• Increase your life insurance if necessary
• Obtain a projection from Social Security
• Increase your savings if possible
ChallengeChallenge
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Your family will thank you.
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Representations made in this presentation are for educational purposes and should not replace an individual, personal consultation with your BYU benefits counselor or DMBA representative.
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Questions?Questions?