Q. Employees are advised to select at least a minimal survivor benefit when selecting retirement options. I understand the base for the survivor annuity can be as low as 1 percent of the overall annuity. The cost of that survivor benefit could be as little as a few dollars a month, as its cost would be based on the 2.5 percent rather than the 10 percent portion of the formula. For example, if the full annuity was calculated as $40,000, 1 percent would be $400; the annual cost of that would be just $10. What are your thoughts?
A. The survivor benefit reduction can be as low as $1 for a CSRS retiree; however, the smallest amount a FERS employee can designate is 25 percent of his base annuity.