Q. I will be retiring in six months under CSRS, and my husband has agreed to opt out of the survivor annuity. Can I designate a beneficiary when I pass, or will that money just be gone?
A. If you don’t provide a survivor annuity, you’ll receive an unreduced annuity. That portion of your annuity which represents a return of your retirement contributions will be tax-free. That’s because you already paid taxes on them when you were employed. If you were to die before you had recovered all of those contributions, what remained would go to your spouse. If he or she was no longer living, it would be given to whomever falls next in the standard order of precedence.
