FEGLI cost is one of the most common questions federal employees ask about their benefits, and for good reason. The premium you see on your pay stub today can look very different at age 60, and it can change again the day you retire.
All figures in this guide are based on the Office of Personnel Management’s (OPM) FEGLI premium rates as of October 2026, which haven’t changed since October 2021 but can be updated at any time. Below, we’ll break down how FEGLI pricing works, what coverage costs at each age, and the retirement decisions that have the biggest effect on what you’ll pay.
How FEGLI Pricing Works
FEGLI (Federal Employees’ Group Life Insurance) is group term life insurance made up of Basic coverage plus three optional add-ons: Option A, Option B, and Option C. Each piece is priced differently. Basic is a flat rate per $1,000 of coverage that stays the same no matter your age, and the government pays one-third of the Basic premium while you pay two-thirds. If you work for USPS, the Postal Service pays the entire cost of Basic.
The optional coverages work differently. You pay the full premium for Options A, B, and C, and the rates are based on five-year age brackets. Every time you move into a new bracket, your cost goes up, and the jumps get steeper after age 50. That’s the main reason FEGLI feels affordable early in a career and more expensive later on. If you want a refresher on what each option actually covers, our complete guide to FEGLI life insurance explains the full program.
What FEGLI Basic Costs While You’re Working
Your Basic Insurance Amount (BIA) equals your annual basic pay rounded up to the next thousand, plus $2,000. Employees pay $0.16 per $1,000 of coverage each pay period (about $0.35 per $1,000 per month), and that rate doesn’t change as you age. If you’re under 45, you also get extra Basic coverage at no additional cost.
For example, an employee earning $85,000 has a BIA of $87,000. Their Basic premium is $13.92 per pay period, or about $362 per year. Basic AD&D (accidental death and dismemberment) coverage is included at no extra charge. For most employees, Basic is the most cost-effective part of FEGLI because of the government contribution and flat rate.
What Options A, B, and C Cost by Age
Option A adds a flat $10,000 of coverage. Option B lets you buy one to five multiples of your annual salary, and Option C covers your spouse ($5,000 per multiple) and eligible children ($2,500 per multiple), up to five multiples. Here are the current biweekly employee rates:
| Age | Option A (per pay period) | Option B (per $1,000) | Option C (per multiple) |
|---|---|---|---|
| Under 35 | $0.20 | $0.02 | $0.20 |
| 35 to 39 | $0.20 | $0.02 | $0.24 |
| 40 to 44 | $0.30 | $0.03 | $0.37 |
| 45 to 49 | $0.60 | $0.06 | $0.53 |
| 50 to 54 | $1.00 | $0.10 | $0.83 |
| 55 to 59 | $1.80 | $0.18 | $1.33 |
| 60 and over | $6.00 | $0.40 (60 to 64) | $2.43 (60 to 64) |
| 65 to 69 | n/a | $0.48 | $2.83 |
| 70 to 74 | n/a | $0.86 | $3.83 |
| 75 to 79 | n/a | $1.80 | $5.76 |
| 80 and over | n/a | $2.88 | $7.80 |
Option B is where costs climb the fastest. Every $100,000 of Option B coverage costs $2 per pay period under age 40, $10 per pay period at 50 to 54, and $40 per pay period at 60 to 64. That’s a 20x increase on the same coverage over the course of a career, which is why many employees who opt for Option B in their 30s start questioning it in their 50s.
A Sample FEGLI Cost Breakdown at Different Ages
Let’s go back to our employee earning $85,000 with Basic, Option A, and two multiples of Option B ($170,000 of Option B coverage). At age 45, their total FEGLI cost is about $24.72 per pay period. That breaks down to $13.92 for Basic, $0.60 for Option A, and $10.20 for Option B.
Now assume the same salary and coverage at age 60. Basic stays at $13.92, but Option A rises to $6.00 and Option B jumps to $68.00 per pay period. The total is now about $87.92 per pay period, or roughly $2,286 per year for the exact same coverage. Salary increases over that time would push the Basic and Option B costs even higher, since both are tied to pay rate.
💰🎂Not sure if your FEGLI coverage still makes sense for your age and budget? Schedule a 30-minute consultation and we’ll walk through your current premiums, what they’ll look like in retirement, and whether there’s a better fit for your family.
How Much FEGLI Costs in Retirement
To keep FEGLI in retirement, you generally need to have been covered for the five years of service right before you retire (or your full period of eligibility if it’s shorter). When you retire, you choose how your Basic coverage will reduce after age 65, and that choice drives your cost. Using the same $87,000 BIA, here’s what each election costs per month:
| Basic election | Monthly cost before 65 | Monthly cost after 65 | What happens to coverage |
|---|---|---|---|
| 75% Reduction | $30.16 | Free | Reduces 2% per month starting at 65 until 25% remains |
| 50% Reduction | $95.41 | $65.25 | Reduces 1% per month starting at 65 until 50% remains |
| No Reduction | $225.91 | $195.75 | Full amount stays in place |
Most retirees choose the 75% Reduction because it becomes free at 65. The trade-off is that an $87,000 policy shrinks to $21,750 within about three years. Option A follows a similar path automatically: premiums stop at 65, and coverage reduces 2% per month until it reaches $2,500.
Why FEGLI Gets Expensive After 65
Options B and C are where retirement costs can get out of hand. At retirement, you choose Full Reduction or No Reduction for each. With Full Reduction, premiums stop at 65 and coverage reduces 2% per month until it’s gone, roughly four years later. With No Reduction, you keep the full coverage but continue paying age-banded premiums for life.
For our example retiree with $170,000 of Option B, No Reduction costs $176.80 per month at 65 to 69, $316.71 at 70 to 74, $663 at 75 to 79, and $1,060.80 per month after 80. That’s more than $12,700 per year at a time when most retirees are on a fixed income. This is the point where many federal retirees either drop coverage they’ve paid into for decades or keep paying rates that strain their budget.
How to Lower Your FEGLI Cost Without Losing Coverage
The best time to evaluate FEGLI costs is before you retire, not after. A few practical steps can make a big difference:
- Keep Basic in place. The government contribution makes it hard to beat while you’re working.
- Review Option B every few years. Check whether you still need the same number of multiples as your mortgage, kids’ ages, and savings change.
- Price private term coverage while you’re younger and healthier. Private term premiums are typically locked in for the length of the term, while FEGLI Option B rises every five years.
- Plan your retirement elections early. Know which Basic and Option B/C reductions you’ll choose before you file your retirement paperwork.
Private coverage isn’t the right move for everyone, and it often requires medical underwriting. But for many employees in their 40s and 50s, comparing options side by side shows a clear difference in long-term cost. Our guide to the best life insurance for federal employees and our FEGLI alternative video break down what to look for.
If you decide to go the private route, don’t drop your optional FEGLI coverage until the private life insurance company has approved your policy. Once you’re approved, you can work with your human resources office to submit form SF 2817 and cancel the coverage. You can do this at any time of year, so you don’t need to wait for Open Season or a health fair. You aren’t covered by the new policy until it’s approved and your first premium is paid, so keep FEGLI in place until then.
Know Your FEGLI Cost Before It Changes
FEGLI is easy to sign up for and easy to forget about, but its cost doesn’t stay the same. Basic stays affordable, while Options A, B, and C climb with every age bracket and can become a significant expense in retirement if you keep full coverage. Running the numbers now gives you time to adjust while you still have options.
If your FEGLI premiums are climbing or you’re worried about losing coverage after you retire, a private policy may give you more protection for less over the long run. Fill out our short life insurance form to compare your options and see what coverage could look like for you.
Frequently Asked Questions
Here are answers to the questions federal employees ask most often about FEGLI costs and coverage.
Basic coverage is your annual basic pay rounded up to the next thousand, plus $2,000, and you pay a flat $0.16 per $1,000 each pay period. Options A, B, and C are priced by age bracket, with Option B also based on your salary and the number of multiples you choose. OPM’s FEGLI Calculator can help you estimate your exact premiums.
Basic does not. The optional coverages do: Options A, B, and C increase every time you enter a new five-year age bracket, with the largest jumps after age 50.
It depends on your elections. Basic with the 75% Reduction is free after 65, while No Reduction keeps full coverage at a much higher monthly cost. Option B and C premiums continue for life if you choose No Reduction.
The FEGLI deduction on your earnings statement is your share of the premium for Basic and any optional coverage you’ve elected. If you see a higher deduction than expected, it’s usually because you’ve moved into a new age bracket or received a pay increase.
Option B costs between $0.02 and $2.88 per $1,000 of coverage per pay period, depending on your age. For $100,000 of coverage, that ranges from $2 per pay period under 40 to $40 per pay period at 60 to 64.
Many retirees keep Basic, especially with the 75% Reduction, because it becomes free at 65. Whether to keep Option B or C depends on your budget, health, and how long your family needs the coverage. A consultation can help you compare the cost of keeping FEGLI against other options before you retire.
Yes. You can cancel optional FEGLI coverage at any time of year by submitting form SF 2817 through your human resources office. If you’re replacing FEGLI with a private policy, wait until your new coverage is approved and your first premium has been applied before you cancel.