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Medicare & Social Security - Getting the Most out of Retirement Benefits

Fri Jul 03, 2015 15:01:47PM | Categories: Medicare & Social Security
An elderly couple eating lunch together.By: Bill Branson

Getting the most out of your retirement benefits isn't as complicated as many may think. While it is true that every seniors situation is unique to themselves and their spouses, maximizing your benefits to ensure you get the best possibly outcome isn't. If you follow these simple steps when it comes to Medicare and Social Security then you have the potential to get the most out of the benefits that you have earned.

Medicare

Medicare is the government funded healthcare system for Americans who are 65 and older. Seniors can sign up as early as three months before you turn 65 if you want your coverage to begin the day you turn 65. You will then have the month of your birthday and the three months after (a total of seven months) to sign up for coverage. If you do not sign up within that time frame then you will have to wait for the Medicare open-enrollment period which lasts from January 1–March 31 and your coverage would begin on July 1 of that year.

Seniors have a few options when signing up for Medicare. They can either sign up for traditional Medicare, which is also called Medicare A and B, or they can sign up for Medicare Advantage, or Medicare Part C. There is also the prescription drug program, or Medicare Part D that seniors have the option of enrolling in.

Medicare Part A is your traditional hospital and home health care insurance and Part B covers other services like doctors visits, ambulance services, mental health services, among others. If you enroll in Medicare Part A and B then you can go to any hospital in the country that accepts Medicare patients. There is no monthly premium for Medicare Part A, but there is a monthly premium for Medicare Part B, which is currently $104.90/month.

Medicare Advantage, or Medicare Part C, are private health insurance plans that are administered by health insurance companies. These plans must offer the same services that traditional Medicare offers, outside of hospice services, and most offer additional services that are not covered in traditional Medicare. Another thing that's important to understand with Medicare Part C is that your choice of doctors and hospitals is more restricted than it is with traditional Medicare.

I am not here to suggest that one plan is better than the other and each individual needs to make their own decisions based on their own specific needs and financial situation.

Social Security

Social Security is an entirely different program and when you should begin drawing your benefits will depend largely on your current and future financial situation. The earliest you can begin drawing your benefits is at age 62, but it is important to know that you will only be getting 75% of your total benefits if you begin drawing that early. If you are able to hold off on drawing your benefits until you turn 70 then you will be eligible to receive 100 percent of your total benefits.

If you can't imagine waiting until your 70 or if your financial situation wouldn't necessarily allow you to wait that long then consider holding off as long as you can. Each year you hold off on drawing your benefits the lower the early drawing penalty will be.

Another important thing to keep in mind if you are going to keep working even after you begin drawing your benefits is that you can be charged a penalty if you wind up making too much money. The Social Security Administration allows you to earn an extra $15,720 in income each year on top of your benefits, but if you make more than that then you will be docked $1 for every $2 of your benefits. So if you plan on working while your drawing benefits then make sure you keep that in mind.

As you can see, maximizing your retirement benefits doesn't have to be as difficult as it sounds. Choosing the right Medicare plan and drawing your Social Security benefits at the right time can really go a long way towards ensuring financial stability well into your retirement years

4 Recommendations
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0 0 1 0 0 Alberta, VA
 

23 hours ago
Replies (0)
I am 61 years old. when can I apply
i moved need to change address and need new card ,my card expires this month
I want to know whay my social security benefits are/estimate from age 68 to age 70
estimated amount I would make at 63
My question is if I make twice the last year of my working years, how that affect my social security benefit ? Is there any significant difference /
0 0 2 0 0 Vancouver, WA
 

217 days ago
Replies (0)
Hello! Sorry I made mistake our income was 13,075.
Regards. Oleg Kanevskiy.
0 0 2 0 0 Vancouver, WA
 

217 days ago
Replies (0)
I wrote to Government Hub that I'm making gross around $30,000 but with deduction it
comes much much less around $10,000-15,000.
Regards. Oleg Kanevskiy.
this site is almost strictly advertisement and difficult getting to the benifit site when simply typing in social security benefits.
The additional earnings offset only applies prior to full retirement age (i.e., 66 for most.)
When you say "earned income" over $15,720, does that include payments from non-tax qualified deferred compensation plans? I will get a W-2, but this income has already been taxed for FICA and health.
1 yr 294 days ago
Replies (1)
So they just passed a new law for social security and there is a deadline to collect additional benefits you may be entitled to? This doesn't seem very real, could someone confirm if this is actually happening or can we just simply call the social security office and set it up our own? It doesn't feel right to have to pay "just a little extra" for something I myself am entitled. For real. Been paying social security FOREVER.

Article found on my yahoo browser with a picture of Obama signing some documents about this new legislation and cuts to social security-
purchases.moneymappress.com/MMRSS4997S/...

I don't know, is this real or should we actually be buying into this?
Anonymous
1 yr 341 days ago
Edit | Replies (0)
I have read this also and wonder if we Ned to check in with SS and make sure we are drawing all that we are entitled to.
1 yr 195 days ago
Replies (2)
i am 56 with 25 years of employement with a college and am being forced to retire due to a regimme chage. can i get social security and Medicaid / medicare
Anonymous
1 yr 290 days ago
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When you turn 62 is the earliest.
Anonymous
1 yr 200 days ago
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The earliest you can begin drawing your benefits is at age 62, but it is important to know that you will only be getting 75% of your total benefits if you begin drawing that early. You can find a new job. Think about a second change. My understanding is that you should wait as long as you can. To receive 100% you have to be 66 or 67. Then, if you wait longer, they will add 8% until you are 70.
1 yr 97 days ago
Replies (15)
To clarify, the full retirement age (100 percent of benefits) is 66 or 67 (if born in 1960 or later). The monthly benefit will be higher the later you retire up to a maximum of age 70. Currently, that adjustment is an additional 8 percent per year after age 66. So retiring at age 70 gets you 132 percent of monthly benefit. ssa.gov/planners/retire/1943-delay.html
Anonymous
1 yr 332 days ago
Edit | Replies (1)
multiply the monthly amount you could get if you don't wait and times 4 yrs and see how much you are giving up. It takes at least 12 yrs to break even.
Anonymous
1 yr 333 days ago
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I agree, why wait, enjoy the money you worked hard to receive
Anonymous
1 yr 291 days ago
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I was a cop, worked in a prison,parole & probation , and taught school.I was tired and felt I wanted to stop working every day to do more of what I wanted while I could. I did not want to wait until 66, then croak. I took mine at 62. the only regret I have is not having any dental coverage though any Medicare options and getting SERIOUSLY penalized by earning a pittance over the allowable amount. there appears be a hope that folks die off before they can get their money. At least it seems that way when they keep upping the retirement age! "-) I am happy. - Jeanne
Anonymous
356 days ago
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I have been in the nsurance and investment business and as usual the federal government has done a terrible job in managing Social Security. In our private retirement plan we have placed then same amount in it as we have had to pay into social security and our private plan will be paying us 4 1/2 times more than what we will receive from social security so that should tell you how poorly the federal government has done. They shoul never have been involved in this shame on the American citizenry. Good thought but as usual with the government extremely poor execution.
Anonymous
1 yr 333 days ago
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Congratulations to you, I 'm a teacher and will also apply for by benefits at age 62. Your comment was helpful
Anonymous
1 yr 291 days ago
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No one is guaranteed life until 70. I am enjoying mine while I can! - Jeanne
Anonymous
1 yr 347 days ago
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Me too
Anonymous
1 yr 200 days ago
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8% per month? That is really high. I thought it was 8% per year.
Anonymous
1 yr 353 days ago
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You will be receiving the same amount whether it is per month or per year. For example: You are receiving $1000 per month. Multiply $1000 by 8% and you will get $80 per month. Multiply $80 by 12, the result is $960 per year. Now multiply $1000 by 12 and your yearly earnings is $12,000. Multiply $12000 by 8% and the result will also be $960. Monthly: $,1000 x 8% = $80 Yearly: $1000 x 12 = $12,000 $80 x 12 = $960 $12,000 x 8% = $960 I hope I made this clear.
Anonymous
1 yr 304 days ago
Edit | Replies (1)
8% is 8%. It doesn't matter whether is calculated on the month or the year. At the end of the year, if you received 8% every month, you will have earned 8% more that year.
Anonymous
1 yr 351 days ago
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Not the same, your math is not very good. If 8% was 8% no mater the time period, what difference would 1 or 4 years make?
Anonymous
1 yr 191 days ago
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we are blessed if we make it to see 80
Anonymous
1 yr 200 days ago
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Do the calculations. How much would you receive at 62 (75%), 66 or 67 (100%) or 70 (8% more each year) Although Frank46 said it is per month!
Thank you for the clarification. I should have been more clear about that.
Anonymous
1 yr 306 days ago
Edit | Replies (0)