025: What career military families need to know about the Survivor Benefit Plan

Jen Amos 0:00

Welcome to holding down the fort, a podcast show dedicated to curating knowledge, resources and relevant stories. So military spouses can continue to make confident and informed decisions for their families. Because let's face it, we know who's really holding down the fort. I'm Jen amis, a Goldstar, daughter of veterans spouse, and your host for today's show. Let's get started.

All right. Hi, everyone, John Ramos, here, your host for holding down the fort. And I am excited because I have the fortune of interviewing my husband today. So

Unknown Speaker 0:48

yeah, maybe should have done that earlier. What interviewed me.

Jen Amos 0:53

Okay, so just for our listeners, we actually have a more candid podcast about us called couples in business with Jen and Scott. So if you want to hear a little more unfiltered, candid conversation of us just kind of talking about whatever, feel free to check that out. But today, honey, I would like for us to kind of be professional.

Speaker 1 1:16

I'm always professional. You are you are you are okay. Well, in my own way,

Jen Amos 1:21

th. And my goal for this year: 2020

Speaker 1 2:36

ing to do at us fat wealth in: 2020

Jen Amos 6:50

of course, and for people that are hearing about the US debt wealth story for the first time. Can you share briefly, how did you get into the financial services industry? And when did you know that this information that we're going to be sharing needed to be shared?

Speaker 1 7:09

Right, you know, I got out in: 2008

Speaker 1 8:17

you know, making hundreds of: 1000

: 17:35

the 70s and 80s, started to pass away from various ailments and stuff. The government said, Okay, we need to implement a system to make sure the spouses the widows will be taken care of. And that's where they came up. With the Survivor Benefit Plan. It was designed in 1972. And so it towards the end of people's careers that tends to come up, and they'll have heard about, it's like, yeah, I know, there's something where something happens to me and my wife gets something, it's like, well, here's exactly what it is, the spouse gets 55% of the pension. So all of a sudden, that 5000 bucks goes to roughly 2500 bucks. It's like, Oh, is that okay? Is that enough? Because then, you know, the equivalent be you're not covering the whole pension, that whole million dollars, you're covering 55% of that. And then the real shocker that everybody gets their time briefing, they say, Oh, by the way, it's not free, you're automatically enrolled into it at a cost is six and a half percent of your pension. And that's when everybody's light bulbs go off. And they're like, wait a minute, what? I just thought it was all part of the plan. And so it's pitched as part of the plan. But oh, yeah, gotta pay for it. And then, you know, it's about a 50, PowerPoint slide brief. It's one of many classes, you're getting near retirement, sometimes the spouses are there. But essentially, everybody's opted into it, whether they want to or not, the spouse has to go in and get a notarized signature to opt out of it. And so it's like, okay, good, it's there. For the lowest common denominator, it's there for the people who aren't good financially, people who are unhealthy and can't qualify for a privatized option. But the fact that everybody's paying the same, doesn't really make any sense because people are retiring in their late 30s 40s. And many veterans are still quite healthy at this time. And so the assumption is, oh, I'm going through my VA disability briefing. So I got, you know, because everybody's got some sort of VA disability thing these days. And so the thing is, well, I got something wrong with me therefore, the government options best for me, you know, they'll take care of me forever or take care of my family. It's and so I want to run it's like how many times to the government mess up your paycheck may mess up your orders your housing, like that happened to me. I was only active duty for six years that happened to me like every time I changed duty stations, it was it was crazy. And it's like, we're gonna rely on that only 30 years from now, if something happens if you do survive, you don't die. So there's just so many, so much misinformation and just status quo acceptance on how this thing works. And then from the financial industry side of things, what has been typically sold as a replacement or alternative, which is basically just cheap term policy, or even more misunderstood a very expensive whole life policy. And so really, neither those things solve the problem, they kind of end up in the same boat as the government option. Because all that stuff is really no different than what they do in the 80s. And so I just got very frustrated with, with the whole thing, government financial industry as like, nobody's really caring about educating the opportunity here and protecting the true value of the asset have the benefit. And so we went out and did the research, we found modern products, monitors, I mean, it's like, we got iPhones, Tesla, Netflix, Amazon, yet in the financial services world. 99% of the stuff that is sold to people is the blockbusters, the rotary phones, the Fords, and the Walmarts. The financial industry in the government, they're huge behemoths, they're dinosaurs and they don't innovate. Why? Because they make so much money. And both institutions are run by self interested individuals. So people in the financial industry make a lot of money, the ones the few who are successful. So why would they change, and the government employees, they everybody knows you get a government job, you're set for life, so they're not going to move quickly to change things in innovate. Yet, our economy is in tremendous debt. Taxes are at all time lows, so they're gonna go up interest rates, super low stock market super high, like the math does not add up on all this stuff. And I believe that, through a combination of that, and all this misinformation that was designed before the internet age, we are missing one, we're missing tremendous opportunity. And then worst case, we're setting people up to take major hit when the stock market corrects and crashes when taxes go up. When inflation goes through the roof, like nobody's going to be ready for it because they were following old advice, old philosophies, old strategies, old products, and it just doesn't make any sense. And so we created what we call the survivor Liberty plan, to give you more flexibility and control over the benefits and the opportunity that comes with having done a career in the military, you searched for it, you earned it. So use it, like own it is is is when people come to us because they want to do that. Well, very cool.

Jen Amos: 22:53

And this is a reason why I wanted to have my husband on this call today because of just his charisma and enthusiasm and passion for what we're doing here at us that wealth. And so, you know, following this episode, I plan on sharing some of the articles that we have from our website us that wealth.com So that, you know, I mean, one, you could definitely go on our website and read them now. But if not, I will be reciting some of those throughout our show, just to you know, add some more value to you as the military spouse or even if a service member is listening to this. But yeah, the more information we can provide to our military families and military community, especially about finances, the better. Now with that said, so, you know, you talked about your background, you know, how you got into the financial services industry, how you saw this issue, and you hinted at a little bit about the solution. So in the military, the benefit that we're talking about right now, that is if you want to call it a benefit is the Survivor Benefit Plan. And just now you hinted at a solution that we would love to educate our listeners about today, which is the survivor Liberty plan. So would you like to elaborate more on what that is? Yeah. And

: 24:11

just to hit on it real quick, like anytime your listeners have questions, they should write into you. And we can do shows like this where you listener question? Oh, yeah, absolutely.

Jen Amos: 24:21

At the end of every episode, I always like to mention that if anyone is interested in getting a hold of us or engaging with us, you can reach out to us at holding down the fort podcast@gmail.com We're also on Instagram holding down the fort podcast, but you could also check the show notes as well the episode details of this episode to see how else you can get a hold of us but that's the top two ways is via email holding down the fort podcast@gmail.com or on Instagram holding down the fort podcast.

: 24:51

Yeah, so it is funny that you know it's considered a benefit. It's an option. It's an option that is Dual insurance, and it's not free.

Jen Amos: 25:03

But let's let's talk a little bit more about that being an option. Because I've heard that you've mentioned before in the past that if you don't want it, you have to kind of jump through hoops just to get out of it.

: 25:16

Right? And yeah, that's about it. Really, it's just, if you decide you don't want it, you have to go into the government transition officer, whatever the retirement briefer, and do a notarized signature to say very clearly you understand. So that's good. I mean, it's not bad, because you don't want to have a spouse be in a situation when they don't have any other, you know, solutions financially. Should the worst case happen. So the point is, let's not assume that, okay, well, it's part of the pension. So I guess I'll just pay the 6%. And go for it's like, well, if you're already paying for insurance, and it's government insurance, and whether it's the VGI, the Veterans Group Life Insurance, which actually is run by Prudential. So you're really paying Prudential, or the Survivor Benefit Plan, that doesn't, that isn't an insurance, that's an annuity, and it's really set up by Social Security, your payments are paying the current widows, so there is no pot of money with your name on it, or as credit system, you're just in the program. And if something happens to you, then the spouse gets that 5% At some point down the line until the spouse is no longer there. And so why not see if you can qualify for a privatized option? Sure, one of the versions of that is term and and just get a lot big term policy. And assume that 30 years from now, you'll have financially prepared yourself to not need the term insurance when that's up. And that's much cheaper than Survivor Benefit Plans. So that seems like an obvious option for most people. Well, problem is, there's a reason why term insurance is so cheap, is because like 97 98% of term policies never get paid out, because the person doesn't die. And even looking at the probability calculators for the Survivor Benefit Plan, the probabilities aren't really high that much of a benefit, just depending on the age differences of the spouse. But these are all government calculators based on the DoD department of the Actuary that when we're doing our analysis for people, we can look at it so so you can go the defensive route and just say, Well, I'm just going to do a cheaper than Survivor Benefit Plan, if I qualify. Well, again, chances are, you're renting insurance at that point, it's only there for catastrophic scenarios. You know, what about adding an offensive approach offensive option. Now, that's not whole life, whole life is still a defensive strategy, it's very expensive, it really shouldn't be used for middle class Americans, it's just that the majority of the financial firms, that's how they can make bigger paychecks. And so they tell them, there's investment option, well, there isn't really a whole lot of equity in there. And again, it's old technology. But again, just like what Teslin everything, there is new technology that allows for more offensive approach, more equity growth, so that you can actually use the money that you've been paying into it for anything you want throughout your life you can use it is a way to get a loan for something or use it for retirement income, or whatever you want. And you get a whole bunch of tax benefits around there. And at the same time, have the catastrophic insurance there for the just in case with the assumption that you're probably not going to need that you might as well take advantage of the other aspects of what these these modern insurances can't can offer. And so that's things like long term care stuff, tax free access, litigation protection. So in our white paper, you can get on the website, and on the various blog posts, we go into all that in more detail. And we also do education, online sessions. Anybody can schedule one with me personally, and we just do the analysis. And that's it. We just take a look and say, All right, here's I mean, it's actually it's kind of fascinating, honestly, that no other financial professionals put this together. Because I've been thinking about it for years and just assumed other people knew about it the way we did, but it was when I was at a private military influencer brief at at USA. It was only like 30 of the financial influencers there actually, I don't even know how I was invited. I was not well known. I had hired a guy who was there and I think got me invited. But all the top bloggers and stuff and I just heard them talking and then of course the USA, you know, top dogs and and I realized that what they were talking about when it came to military benefits, all great information, but none of them were thinking, second and third level order of effects. And they were very unaware of the modern tools and technology because none of them are licensed professionals in USA. Again, there's mostly Car Insurance Company, United States Automobile Association, they outsource all their financials, actually, they just got rid of their financial planning arm and their investment arm, they sold it off. Even their life insurance is just outsourced to another company. Same with a real estate stuff. So people misunderstand, you know how these things all tie together? And then a lot of the bloggers are more focused on the kind of day to day life and military life, where do you get cheaper credit cards? You know, how does the survivor benefit plan work through write massive blog posts, that basically just translates what the government websites do and, and most of the opinions on what to do about it, again, are based on the the old privatized versions of this. So that's where I saw opportunities, like, Oh, this is where we can be a game changer. To truly give people who are motivated around their money, who want to maximize the value of their pension, realize that the catastrophic event probably isn't going to happen, and you're gonna be around for 30 years, I mean, that Lieutenant Colonel, you know, getting five $5,000 A month paying six and a half percent of that that's like three 400 bucks. If you don't die, 30 years later, average will have paid into about $150,000 into that Survivor Benefit Plan. And if the spouse dies first, there's then no benefit, nothing, you don't get the money back. And then there's no benefit for kids. And you hear that happening. I know one of our team members, parents were neighbor was talking about I was he's 65 years old, and his in career military already been paying into it. And that was when he learned when he said, Yeah, my spouse died about two years ago. And we were talking about this pension thing. And he's like, Wait, so I just he didn't even know he was paying into it. Because all I knew is what he was getting. Right? It kind of forgot about it. It's like no, this adds up. Well, what if instead, you put that same $150,000, over the 30 years, 10 years, whatever, it's like, you're already going to commit that money. Why not put it into a program where if 30 years later, you're still alive, not only could you get your money back and still have the insurance, but also maybe have doubled that money, maybe you got $300,000 available. So instead of being down 150, you're positive 300. I mean, that's a multi $100,000 swing for an average officer, obviously, slightly less for enlisted folks who are getting out, but still significant money. And in we're just throwing that back at the government, we're not being good stewards of the taxpayer assets in that case, and this happens for 80%. of active duty military who are career military, who are finding out about late they end up opting into it, but 80% do because it's like, Ah, well, what do I do?

Jen Amos: 32:42

Wow, that's a lot, right. And

: 32:44

you what it causes is paralysis by analysis. And people go, Oh, I gotta look into this myself. And I gotta do my own analysis or research because I'm a, I'm a good, I'm a good military service member, I gotta go figure this. It's like, we've already figured it all out, we've done the research, you can't even access the modern stuff, unless anyways, but come talk to us, like, we would love to just see those strings attached. We only need about 30 minutes, really to say, hey, you can do this, you can do this. Now, the sooner you implement, the better it works out. So this is actually really best for people that are 10 years away from retirement and the military instead of right at the last minute. That said it can still work out. But the earlier you do it, the better. And it's also important to get qualified before you find out if something would disqualify you. Right? So a lot of times when it ends up happening is people say, okay, I get it. I just busy, I got all these other things. And I'm gonna wait until I get out and get a job before I do this. It's like, no, no, this only works if you get it, and you can qualify and you implement it. But then once you do, then you have a resource that you're in control of. But it's kind of like, when you learn about it, the quicker you fix it, the more money you save, right? And the less risk you have of not being able to qualify. So that's why in the military, it's always kind of like now next duty station or next job, or hopefully I'll get that next promotion. Or I'll see if I get promoted. And then I'll decide. I mean, this is pretty powerful stuff that has just been completely swept under the rug. And most people, like Jared was saying the other day, it's like, Oh, I've talked to a bunch of people. And that's like a third tier issue for him. It's like, Yeah, I know. I know, it's a third tier issue. And that's what's crazy, which is why we shouldn't be the first issue. I mean, what do you what are you signing up to serve to 20 years for like, everybody loves serving their country, but very few except for the ones who were just like, No, nothing else are just like, I can't believe I have to leave the military. 2022 years. No, they're like, Oh, my God, I'm done. Like what's next? I mean, that's just reality. I mean, it's so it's like, well, this is what you stayed those 20 years. As for why are we only in and paying attention to it? So that's what always flabbergasted me. And I couldn't tell if it was intentional misinformation, or just complacency from the government, you know, which I don't know. Right. We could go both ways. I could talk hours on both those thanks. You know?

Jen Amos: 35:20

Yeah, absolutely. And so part of our campaign for this new season of holding down before is just providing more information on this, just because we see the value in it, and we want you to be aware of it. And this is coming from, you know, our team mainly consists of veterans, you know, so they were military spouses and military spouses. Yeah, exactly. So with that said, Scott,

: 35:47

I mean, the last thing I mean, actually, on that point with the military spouses, yeah, that's the other thing that blows my mind about this whole pension Survivor Benefit Plan problem. The education is usually geared towards the service member, and has nothing to do with them.

Jen Amos: 36:02

Right, even though it's,

: 36:04

it's all about spent literally, it's who makes the decision? The spouse makes a decision. It's who's the who gets the benefit? If there is one spouse gets it? Only? Not the kids? I mean, yes, there's a thing if you know, before the kids are 21, they get a little bit all that, but it's like, this is really I mean, they're the ones How often does the spouse? You know, yes, they can go to the retirement briefings, the transition briefing sometimes, but what about all the other guests what there have been financial, there were required financial briefings throughout their career? Is the service member always coming home with a stack of information and saying, This is what I learned? And oh, by the way, here's the other people's opinions on all that stuff and different people's thoughts? Or is it usually? Well, what did the what did the guy next to me do? Or what did my, my guy my Command Sergeant Major, who got out? What does he say to do? Well, if he's now a government employee, what do you think he's gonna say to do and we're all just kind of blindly following orders. It's like, this is your money, you don't have to follow orders anymore. In really, in this day and age, maybe you shouldn't, because that's really the risk of just getting a job and saving for retirement is, I believe, with the amount of variables we have in modern times. And with where the economy and the stock market and all that kind of stuff, we're taxes and all that, alright, you know, if we're just leaving it up to saying, Oh, I got a good job, or my retirement account is going to work out. That just seems crazy. To me, I just, and I was being told that that was good advice to give to folks. And therefore, I should be proud of myself. And I just lost all integrity and realize that this is not true. But at the time, this is years ago, I was like, Well, what is what can we do about I didn't know if we could, and then I'm excited and glad to say, we found something, I found something cool. We created it, I want to work with other financial professionals, not not just people I can help. I want to teach other financial professionals how to do this, you know that they're frustrated that their firms that they might be at that are being taught the old way, not getting a lot of help, and how to bring unique value to people like I want to talk to them as well say we need to help more military families understand how to maximize the resources, because imagine we get more of that wealth out into the economy, coming from the veterans, allowing veterans and military spouses to have more influence in our community. I mean, that's my only hope. If we can get more wealth in our community, chances are they'll take more positions of influences in society. And hopefully, we could stop all this knucklehead pneus that we have going on in our government, you know, I don't care Democrat or Republican. They're constant wars, constant overspending, you know, we need to take and constant attacks politically on everybody. I don't even know what's going on with with media is telling the truth. Like we need to take those leadership roles, we raised our hand or oath that serve our country, our Constitution, if we want to defend it, and we can't do it, you know, in uniform anymore. We can do it with our influence. And that's my my dream. My goal is to get more veterans and spouses aware of their opportunities, aware of how money works, and aware of how to create influence in modern times. Again, never been a better time in all of human history to take advantage of that, because there's literally wealth floating around in the air, and it's in the form of Wi Fi, and you can go grab it, if you know how, or you can get stuck in traffic every day for the rest of your life until you can finally retire. What's more motivated? I mean, I know who I want to work with And I'm not here to convince all those other people to change their minds if they're like, you know the stuff that way. Cool, cool. All you trust the government want to do it that way. Cool, cool. But for those who don't, I know, well, I get it all the time. It's like, Oh, I've been waiting for somebody to talk like that. Well, I'm talking like that. So that's what we do.

Jen Amos: 40:21

Well, thank you, honey for that. And

Unknown Speaker: 40:24

I feel like I was yelling at you the whole time was,

Jen Amos: 40:26

well, what's new know? What would that said to our listeners, especially to military spouses and families, we hope that, you know, my goal here for the show is to add a different perspective and add resources and education outside. In addition, I want to say I don't want to be against but in addition to what you may already be receiving from the government, or even your service member, so, honey, thanks for being on.

: 40:55

Yeah, I just want to be a trusted resource. Again, we got our military transition guide on the website if you're in transition. We've got our survivor Liberty plan, white paper, tons of videos and that kind of stuff. And of course, you can go to our website to schedule a consultation.

Jen Amos: 41:15

Yes, absolutely. Or you can check the show notes like we've mentioned already, you can reach out to us on Instagram or email holding down the fort podcast@gmail.com. With that said, thank you so much for listening. We hope to continue the conversation with you did you reach out to us and until then, till next time