What is your opinion of the DoD Survivor Benefit Plan? Do you see it as an annuity or life insurance? Would you recommend this benefit?

My opinion is that the SBP is too expensive. You can spend half as much to purchase a term insurance policy that will pay your spouse a lump sum that he/she can invest. If invested wisely, such a nest egg could provide him/her a lifetime monthly income equal to or greater than the SBP. This assumes that you've also ensured you're debt free or have enough insurance to cover both debts (e.g. mortgage) and the necessary lump sum for investment purposes.

I see it as annuity for my wife who has stood by and supported me for much of my military career and all of my VA disability time. Unfortunately since Congress has not backdated mobilization credit to reduce retirement age by each period of 90 days of creditable mobilization going back to 9/11/2001, I will probably have to wait until October 2016 to activate my survivor benefit plan (SBP). As far as I know the survivor benefit plan has no reserves and like social security is based on Congress approving and appropriating funds to sustain them each year. I am hopeful that SBP will be solvent throughout my wife's life and beyond for all serving service members spouses to benefit from.

I had my financial adviser sift through all the cash flow options and going Max was the best deal for us. It may be different for others depending on what your post retirement income flows are.

I only have four years to go so it's not a big thing now but I dont' like the fact that all is lost if the spouse passes first.

This is a very emotional time and the required choices only make it more difficult. If you don't take it and you choose to enroll later during an open enrollment, then you have to pay back all the years you were not previously enrolled plus interest. If you do enroll and your spouse passes away before you, then you lose what you previously paid. This is similar to Term Insurance, but the SBP costs much more. The other disadvantage that used to exist (not sure if it still does) required you to continue paying even after your spouse passed away. I believe this may have recently changed so you could stop paying if your spouses passes away first, but would need to be verified. The only good news is you no longer have to pay for life, which used to be the case years ago and now stops after 30 years (or at least that was the requirement I remember when I retired). If you pass first, then the question is will your spouse live long enough to recover what you previously paid into SBP or more. Women generally have a life expectancy 2 years longer than men.

A few additional items to consider. I have often been told the longer a person is in the military the lower their life expectancy. I have never researched this issue, but might be worth considering. Of course, there is also your current health. My wife was extremely ill and had a near death experience as I approached my eligibility for retirement. My decision was fairly simple - I needed to be able to spend more time with my family (wife & children) and take care of them physically & financially. Since there appeared to be an extremely low chance of my wife living longer than me and uncertainty of the job market, I chose to not take SBP and get $500K in life insurance on myself for 20 year plan for $32 a month from Navy Mutual Aid Association. My thought was in the rare case if I died and my wife survived, the $500k would provide about as much income as SBP (Survivor Benefit Plan) assuming she was to outlast me for about 20 or so years depending on how much the SBP would rise every year and assuming the $500K was not invested and did not make any additional money over time. I believe this to be the best decision financially for my situation. Some would also argue if you take the difference between SBP and Term Life and invest it automatically every month, you could create more assets over time.

Bottom Line - You have to do what is right for you and your family, but your spouse must agree if you choose not to take SBP.

I turned it down because my wife is 13 years my senior. Still wouldn't have it any other way...

I took it when I retired in '09. It was explained to me as basically paycheck insurance that when I kick the bucket the beneficiary will continue to get part of my retirement for a time afterwards. May be worth it, may not be. Honestly i looked at it as a way to keep some incoming in to give my family time to adjust to the loss of income when I die.

It looks like an annuity to me. It even talks about annuitization somewhere in the paperwork, but nobody I talked to ever said it out loud. The briefing was given to me by a contractor for the HR people, and didn't really know what an annuity was, but I asked a retired JAG buddy, and he said it is.

I think electing for this benefit has a situational element to it I was med boarded with a 70% rating from the Army at 28 with my 3 year high average not being very impressive as an e-5. At 28 let's assume I live to be 70+ definitely not worth it instead of 200 bucks to secure a small percentage of a small salary that $200 goes into an Ira every month that my wife is the sole benafactor of.

I signed up for SVP after talking to retires who did not take it because they were going to take out a civilian plan instead. They never did that and life insurance was the first thing they dropped when money was tight. With SVP it comes out of my retirement pay for 26 years. I have three more years to pay. I wanted to make sure my wife has other income. So, my decision was made based on the above. Today's military pay may allow for greater savings and SVP is not needed. Your civilian job may have a strong 401K plan that meets retirement needs down the road. If you opt for the 401K strongly suggest you put the max 25% into it. This will also reduce your annual tax to IRS and your state.