Social Security, Medicare and Cobra by Warren Elkin, Lifetime Retirement Income Planning

Lifetime Retirement Income Planning with Warren Elkin

Lifetime Retirement Income Planning with Warren Elkin

Decide when to claim Social Security. Social Security statements became available online for the first time in 2012, and more than 1 million people have already downloaded them. Check your statement to make sure your earnings were accurately posted to your Social Security record, and make note of how much you will receive from Social Security at various dates. Most baby boomers can claim the full amount of Social Security they have earned beginning at age 66. Boomers who sign up before age 66 will get a reduced payout. Retirees can further boost their monthly payments by delaying claiming up until age 70. You don’t have to sign up for Social Security in the year you officially retire.

Sign up for Medicare on time. You can first sign up for Medicare beginning three months before the month you turn 65. This initial enrollment period lasts until three months after age 65. If you don’t sign up during this seven-month window around your 65th birthday, your monthly premiums will increase by 10 percent for each 12-month period you were eligible for, but did not enroll in, Medicare Part B. If you are covered by a group health plan based on your or your spouse’s current employment after age 65, you need to sign up within eight months of leaving the job or health plan to avoid the penalty. For people who retire before age 65, you need a plan to maintain health coverage until you become eligible for Medicare, such as through COBRA continuation coverage or a spouse’s health plan.

Make sure you are vested in your retirement benefits. While you always get to keep the money you contribute to your workplace retirement account, you don’t necessarily get to keep your employer’s contributions until you are vested in the retirement plan. Some retirement accounts don’t allow you to keep any employer contributions until you have been with the company for a specific number of years, while others allow you to keep a proportion of your benefit based on your years of service. Find out the date upon which you can keep all of your benefits, especially if you have only been with your current employer for a few years. In some cases, it can be worth it to stick around for a few extra weeks or months to get a bigger retirement payout.

Protect your savings. Shift your primary investment strategy from growth to protecting what you have.

Spend down your assets. Retirees need a plan for how they will convert their retirement savings into a stream of income that will pay their monthly bills. Factor in the income tax that will be due on traditional 401Ks and IRA withdrawals.

Don’t forget to take the required minimum distributions from your traditional 401K and IRA accounts. There is a stiff 50% penalty for failure to take distributions by 70 1/2.

Make sure you have all the facts necessary to make the right decision with your financial future by calling us today! We can help you with information regarding Annuity, Annuities, Fixed Annuity, Fixed Annuities, Variable Annuity,Variable Annuities, Immediate Annuity, Immediate Annuities, Income Annuity,Income Annuities, Deferred Annuity, Deferred Annuities, Index Annuity, Index Annuities, 401k Rollover, IRA Rollover, Retirement Income Planning, Immediate Fixed Annuity, Immediate Fixed Annuities, Annuities Calculator, Deferred Variable Annuity, Immediate variable Annuity, Immediate Income Annuity, Immediate Income Annuities, Deferred Variable Annuities, Best Fixed Annuities,
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Speak with us now at 877-476-5051, email Warren at, or go to to learn more about Warren Elkin of Norhill Financial and his unique process to make sure your financial decisions are made in your best interest.

The Cost of a Healthy Retirement

Ever since the 2008 presidential elections, America has been in whirlwind discussions over our healthcare system.  Any American that has paid attention has had healthcare in the forefront of their mind at some point over the past four years. But it’s becoming an increasingly important issue for a specific group of Americans: The retirees.  The estimated retirement healthcare costs are continuing the rising trend from the past decade. The latest estimate from Fidelity Investments puts this year’s figure at $240,000.  That figure, up 4% from last year, means that on average, a 65-year-old couple retiring in 2012 can expect to pay $240,000 for their healthcare costs over the remainder of their lifetimes. This figure is based on the average life expectancy of men living to 82 and women living to 85. To add insult to injury, that figure doesn’t include the cost of long-term-care, dental care, and any over the counter medication.

The figure cited for the 2011 cost expectancy broke a long term trend of rising costs as Fidelity cited effects from Obama’s plan for healthcare that would reduce many of the senior citizens out of pocket expenses as the reason for their estimation decrease.  That figure was $230,000, a $20,000 drop from 2010.  That break in costs has been overwhelmed by overall healthcare trends causing this year’s increase, which is a cause of concern for more and more people nearing retirement.

So the question is, what can we do about it?  Of course, a shorter lifetime would mean lower costs, but that’s not high on anyone’s investment goals.  Luckily there are a few ways to help manage what seems like a pretty intimidating number sitting in your future.  Here are a few suggestions..

  • Know it. Expect it. Plan for it.  It’s the most simple, but one of the hard to accept options.  Healthcare expenses in America are unpredictable on both an individual and societal level.  Legislation may or may not affect your future costs.  The figure for this year was based on current legislation, which we all know may, or may not remain in place.  If you are planning your retirement you might not take into account certain expenses (either consciously or subconsciously) such as hearing aids, dental work, the possibility of retirement homes and assisted living facilities.  45% of the total expenses estimated by Fidelity are out-of-pocket expenses.   Make sure when you are planning your investments and target figure for retirement you take these things into account.  Healthcare is something you don’t  want to have to skimp on later because you failed to address it now.
  • Understand Medicare- what it is and what it could be. If you are looking to retire now, or in the near future, the status of Medicare is somewhat up in air.  With each change in legislation, it’s important to know what it will cost you, what will be covered, and how to adjust your budget accordingly.  The costs associated with Medicare go beyond the copays, and it’s critical to understand which programs cover what.  Medicare Part A is the general program covering hospital services that most people are familiar with, which doesn’t carry a premium for most beneficiaries.  For almost $2,500 a year, a couple can spring for part B which covers many of the doctors and other services that A misses.  For an additional expense, you can buy Part D which covers prescription drugs.  32% of the total estimated cost of health care for retirees lies in the premiums for Medicare part B and D.  Then, to cover all things not covered by the various Medicare policies, for another $4,000 a year a couple can purchase a Medigap policy, cleverly named as it fills the gap in coverage of the previously purchased programs.  Take the time to figure out what programs you need and what those programs will cost you.  A little math now will save you a lot of time, energy, and money later.
  • Take care of yourself and your body. This might be the most obvious, but commonly overlooked piece of advice.  The fewer health problems you have in the future the less your healthcare will cost you.  Prescription drugs costs account for 23% of the total estimated figure for healthcare for retirees.  The need for many of those drugs can be reduced, if not completely avoided, by living a healthy lifestyle, starting today.  Schedule your checkups.  Eat healthy.  Get some exercise.  These are things that we have been told our entire lives, but now you have dollar signs as your motivation to do so.

The cost of healthcare for retirees is high, but that cost for not planning for it is even higher.  Do your homework, keep up with the changes, and add them into your budget.  Healthcare costs as a senior citizen doesn’t have to be a morbid subject, unless you forget about it.

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