Veterans who are working on their retirement plan should always consider the various types of financial support they may receive during their lifetime. The two most common types of financial benefits available for veterans are pension benefits and compensation benefits. In this post, our Los Alamitos veterans pension benefits lawyer will discuss the basics regarding veterans pension benefits.
How are compensation and pension benefits for veterans different?
When it comes time to plan for financial support in retirement, veterans actually have a few options. Compensation and pension benefits are not the same types of resource. Compensation benefits are paid to veterans who are disabled as a result of their military service. These types of benefits are, therefore, not income-based but are based instead on the severity of the disability and the veteran’s ability to work. It is important to realize that not every disabled veteran is eligible for compensation benefits because not all disabilities are service-connected.
Pension benefits are different in that they are awarded to veterans who served in the military during congressionally defined wartime and who are permanently and totally disabled, even if the cause is not solely related to their military service. Also, pension benefits do not accrue based on length of service, as with employment-based pensions. Instead, veterans pension benefits are paid monthly to eligible veterans with a disability.
What are the eligibility requirements for veterans pension benefits?
In order for a veteran to be eligible for disability pension benefits they must not have been dishonorably discharged, must have limited income, must be permanently and totally disabled, and that disability must not be the result of willful misconduct. Also, for veterans who joined the military after 1980, he or she must have served at least 24 months of active duty or the entire time he or she was called to duty. Veterans who were discharged because of service-related disabilities must have served a continuous period of at least 90 days during a period of war or at least one day during wartime.
The purpose of the veterans pension program
The veterans pension program was originally established as a way to provide supplemental income to veterans who were required to change their career goals in order to serve in the military. In light of the financial security most veterans had to relinquish when serving, the pension program was created as a need-based program. It was meant to supplement the social security income totally disabled veterans receive.
Automatic eligibility for veterans over the age of 65
Veterans over the age of 65 are presumptively permanently and totally disabled and therefore, in most cases, automatically eligible for pension benefits. On the other hand, a veteran cannot receive both pension and compensation benefits. So, if you qualify for both types of benefits, you must choose which type of benefit you would prefer. In order to establish eligibility for pension benefits, veterans are generally required to submit to a physician’s examination, referred to as the Compensation and Pension Exam. If you have questions about establishing eligibility, our Los Alamitos veterans pension benefits lawyer is here to help.
Veterans still need to plan for retirement
Clients often have the false impression that social security benefits and a basic 401K are sufficient for retirement. The truth is, it is important to create a real retirement plan so you won’t need to be dependent on government benefits, in order to have a comfortable retirement. Social security may not be as secure as you think. That’s why you need a retirement plan. Our Los Alamitos veterans pension benefits lawyer can help you to include your pension benefits in your retirement planning for the best possible outcome.
It is important to begin to set aside sufficient savings as soon as possible
A huge part of retirement planning is being sure you have enough money saved up to support your financial needs once you retire from the workforce. It should go without saying that, the sooner you start putting money aside, the more you can have saved up by the time retirement actually rolls around. So, if you haven’t already, open a savings account and start making your regular deposits immediately. The sooner the better because you will be able to benefit from more compound interest.
Update your retirement plan whenever necessary to keep it current
It is important to occasionally review your retirement plan to be sure that necessary changes are made. Just like an estate plan, a retirement plan needs to be reviewed sporadically so you can make necessary revisions and adjustments that will address changes in the market. Those changes could potentially have a negative effect on your investments. If they are not addressed you could lose out on a lot of income. You may also need to adjust your plan when there is a change in your income or expenses that may alter your overall plan.
If you have questions regarding estate planning, trust contests, or any other trust administration issues, please contact the Schomer Law Group either online or by calling us in Los Angeles at (310) 337-7696, and in Orange County at (562) 346-3209.
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