Retirement For Dummies...

[islandguitar]

Good thoughts, Tom!! As my father-in-law points out (he's now 88 and still golfing), you'll have the energy to do those things on the front end, whereas later on, even if the resources are there, you may not care to put that kind of effort into trips and active things you've aspired to do in retirement.
I've heard folks refer to this as the: "Go/Go years", and the "No/Go years" LOL!! How true
I can see this in my own situation as my wife is 9 years younger than I (I'm 72 nearing 73). We're now working through how much we'll do and when with all this taken into account. Oh yeah, and paying for it too!! LOL! So far so good with things which are fun and having meaning for us!
Best wishes for creative planning!
Fred

[Murphy Slaw]

Great comments so far.

It's fascinating to me how complex it is with the medicare stuff. I must admit I still don't get it. The way I understand it, you can't get it until you're 65, and then you HAVE to get it. But then you need a supplement to protect your assets from all the stuff it doesn't cover.

It's the A,B,C stuff I don't get? Do you BUY that from the Government or simply sign up for it?

I'll be 62 in Feb., and I'm covered by my wife's insurance, so I guess I have to do some serious research about it.

Only the Government could turn retirement into work......

[imwjl]

Originally Posted by Murphy Slaw

Great comments so far.

It's fascinating to me how complex it is with the medicare stuff. I must admit I still don't get it. The way I understand it, you can't get it until you're 65, and then you HAVE to get it. But then you need a supplement to protect your assets from all the stuff it doesn't cover.

It's the A,B,C stuff I don't get? Do you BUY that from the Government or simply sign up for it?

I'll be 62 in Feb., and I'm covered by my wife's insurance, so I guess I have to do some serious research about it.

Only the Government could turn retirement into work......

I'm digging into all this right now with a twist. My own age plus a group of siblings and spouses are also working with parents moving to next stages of senior living, services, health providers, insurance and financial institutions. So far the government agencies are a breeze and helpful compared to the other institutions, and a lot of the rules or structure seems to come from them - their interest. I suggest patience and a deep breath. My same methods that work with airline counters, TSA or customs seem to help all of us. That put on a smile whether or not you really feel that way.

One thing for sure in this. I'm pretty sure I'll keep working until 65 or more for a bunch of reasons.

I'm also playing it in a conservative manner because we took a hit in the last recession, I'm seeing how high your monthly costs can be, and I expect another downturn or few in my life based on how many genes it seems I got from my mom.

Good luck!

[catdaddy]

Originally Posted by Murphy Slaw

Great comments so far.

It's fascinating to me how complex it is with the medicare stuff. I must admit I still don't get it. The way I understand it, you can't get it until you're 65, and then you HAVE to get it. But then you need a supplement to protect your assets from all the stuff it doesn't cover.

It's the A,B,C stuff I don't get? Do you BUY that from the Government or simply sign up for it?

I'll be 62 in Feb., and I'm covered by my wife's insurance, so I guess I have to do some serious research about it.

Only the Government could turn retirement into work......

Yes, Medicare is a complex healthcare system. It has to work for the majority of U.S. citizens who make it to age 65, and was designed to offer options to accommodate a variety of individual needs.

My situation is fairly typical of someone who at age 65 had no employer health insurance. I signed up for Medicare Parts A & B. I preferred that to the Medicare Part C (Advantage Plan) which is cheaper and a bit more comprehensive in coverage (some include prescription drugs, eye care and dental benefits) but limits the providers which you can use (similar to a private insurance HMO plan). I wanted to choose my own doctor(s) and health care facilities so Parts A & B gave me that. My Medicare premiums were then automatically deducted monthly from my Social Security check.

I then signed up with a private insurer to get a Medicare supplement (Plan F- the most comprehensive) that would cover all of the expenses (typically 20% of medical costs that Medicare A & B doesn't cover). I pay them a premium directly each month (not from Social Security income.)

Finally, I chose a Medicare Part D Plan to help cover the cost of my prescription drugs.

My health insurance coverage is essentially comprised of 4 separate components: 1. Medicare Part A 2. Medicare Part B 3. Medicare (Medicare A & B) supplement 4. Medicare Part D. My deductible and out of pocket expenses for doctors visits, lab tests and hospitalization is $0. I do have to pay a deductible and co-pay for my outpatient prescription drugs (Part D), and some drugs are not covered at all, but all inpatient meds are covered completely(Part B).

If you don't mind having your medical providers being restricted to an "approved" list then Medicare Part C (Medicare Advantage Plan) could (depending on what state and location within the state you reside in) provide everything in the way of coverage that I have in a single package.

Good luck with your research. At least you have plenty of time figure out what will work best for you.

[Kerbie]

Great info, Cat... thanks!

[GCWaters]

Medicare can be fairly complicated, and there are consequences if you do it wrong. There area also groups out there who will charge you for doing things you can do yourself for free, so watch out for that. Here's a good primer on the whole process:

https://www.fool.com/retirement/medi...know-2019.aspx

[imwjl]

Originally Posted by catdaddy

Yes, Medicare is a complex healthcare system. It has to work for the majority of U.S. citizens who make it to age 65, and was designed to offer options to accommodate a variety of individual needs.

My situation is fairly typical of someone who at age 65 had no employer health insurance. I signed up for Medicare Parts A & B. I preferred that to the Medicare Part C (Advantage Plan) which is cheaper and a bit more comprehensive in coverage (some include prescription drugs, eye care and dental benefits) but limits the providers which you can use (similar to a private insurance HMO plan). I wanted to choose my own doctor(s) and health care facilities so Parts A & B gave me that. My Medicare premiums were then automatically deducted monthly from my Social Security check.

I then signed up with a private insurer to get a Medicare supplement (Plan F- the most comprehensive) that would cover all of the expenses (typically 20% of medical costs that Medicare A & B doesn't cover). I pay them a premium directly each month (not from Social Security income.)

Finally, I chose a Medicare Part D Plan to help cover the cost of my prescription drugs.

My health insurance coverage is essentially comprised of 4 separate components: 1. Medicare Part A 2. Medicare Part B 3. Medicare (Medicare A & B) supplement 4. Medicare Part D. My deductible and out of pocket expenses for doctors visits, lab tests and hospitalization is $0. I do have to pay a deductible and co-pay for my outpatient prescription drugs (Part D), and some drugs are not covered at all, but all inpatient meds are covered completely(Part B).

If you don't mind having your medical providers being restricted to an "approved" list then Medicare Part C (Medicare Advantage Plan) could (depending on what state and location within the state you reside in) provide everything in the way of coverage that I have in a single package.

Good luck with your research. At least you have plenty of time figure out what will work best for you.

Thank you.

As complicated as that seems, I found it worse looking at options I'd have between now and 65 where a mistake on my medical record that's haunted me still does.

My understanding is the actual providers where I am would be same two networks most have. In a way not much change.

I need to do homework and see where Medicare Select is in those tiers because that's all our current provider takes and I'd like to stick with them. We're starting a third year in a physician's coop and wow has the service been better. The physicians do have limited services, you see PAs more, and get referred to the university for major issues. I'm totally sold on their way because the speed and service are so much better for most issues.

FYI, the other thing I've learned if you're thinking of selling your home and buying into a senior community is pursue luxury apartments near high service areas. In my area that's an easy $ hundreds to $ thousands saved per month and in some ways more normal living. You're not putting your assets into a place and have a lot of money each month for help and transportation.

[dirkronk]

I'm pretty well immersed in the whole issue of retirement without actually being retired: I'm 69, still working, with plans to fully retire when I hit 70 next July. That will max out Social Security for me, and if I keep working, total income will kick me into the next higher tax bracket...so I'll be getting out of the rat race. Meanwhile, my wife is three years older than I, getting her full SS (she waited 'til 70 to get it) but still working, too...can't get her to stop, it's crazy.

We're both on Medicare. Rodger's post is fairly accurate, with the following modifications. Yes, part A is what everyone gets, no charge. Part B you pay for, either out of pocket OR directly from your SS once you start receiving it. These two parts are the government's bailiwick.
Part D is drug coverage - through private insurers.
All the other letters (not just "C"...plenty of others, though not quite the whole alphabet; my wife and I have plan F) are plans that supplement A and B and are also offered through private insurers, and honestly that's where a lot of the complication is. This is one time in your life when it pays to spend time with an insurance salesman, assuming he/she knows this stuff. Luckily, we found a good one who could explain what the different supplemental plans did and did not cover.
In my case, I could have used my work health insurance as supplement, but it was less expensive to go with other private supplemental plans. Thus, I was able to opt out of the work insurance.

Re SS: "Full retirement age" is kind of a misnomer, as others have said, but essentially it's a midpoint between 62 and 70, recently sliding closer to the latter number. If your family genetics hint that you won't live into creaky decrepitude, go for an earlier start to benefits as you wish. Otherwise, the general rule is, for every year you work past 62 (and up until age 70), your eventual payment from SS will go up 8%. For me, it seemed to be worth waiting.

Re 70-1/2: If you have a traditional IRA, SEP-IRA, 401(k) or 403(b) or similar plan, you've been putting money in before taxes and/or getting other tax benefits from Uncle Sam. When you hit age 70-1/2 (I kid you not...like that's a normal milestone!), Uncle Sam now wants his share and you must start taking RMDs (required minimum distributions) from all such accounts, reporting them as income and paying tax on them. Unless you're uber-wealthy, it probably makes sense to roll over ALL such accounts into a single Roll-over IRA at a bank or (more likely) a broker or mutual fund company; that way, you only have one account to mess with instead of several AND the financial firm will do most of the grunt work for you...figuring out how much RMD to withdraw, cutting you a check, reporting to the IRS and so on. TWO IMPORTANT NOTES: (1) RMDs don't apply to Roth IRAs, since you fund these with after-tax money, and (2) if and when you let all your assorted traditional IRA/401(k) money go into a Rollover IRA, ALWAYS tell your financial firms to "roll over" the money to the new account...NEVER say anything like "cash out" or you may expose all of your IRA/401(k) money to immediate tax liability.

Re investing for or during retirement (part 1):
Other people have written books on this, but let me just mention two sources of info that might be worth looking at. First, Morningstar.com is a pretty reliable source that rates stocks, mutual funds, ETFs and the like, and has plenty of info on all investing topics. Go to their website and sign up (basic membership is free; premium is like $199/year...hopefully you'll get enough info free), then check out articles especially by Christine Benz. Second...

Re investing (part 2) AND other stuff to know in retirement:
Kiplinger magazine puts out a general Retirement Planning guide each year, separate from their monthly magazine, and it manages to cover most retirement topics (not just investment), so that it may be worth the $7.95 cost ($6.95 if you go for online PDF only). However, if you're willing to go to your local library, which probably has Kiplinger as a magazine subscription, go through the most recent year of back issues and you'll probably get all the info you'd get in the guide, and free. They DO recycle most articles. Kiplinger's website also has a retirement section, but a lot of the articles there are dressed up as "did you know" lists or quizzes...easy to read, maybe, but more cute than comprehensive when it comes to usable info.

There are plenty of other online sources of information on retirement, but the Morningstar (and less frequently Kiplinger) sites are ones I go to on a regular basis.

Hope some of this helps.

Dirk

[CASD57]

Originally Posted by Murphy Slaw

What's Medicare Part Z ?



Can you retire at 62, keep your insurance, make money on the side, still eat cookies?



I'm getting close, but haven't done much research and need to catch up.



What's the best resource?



This is starting to look like retirement is going to become a full time job...

Haven't read the whole thread but i was serious to take it this year.. here is what i learned about 62 and SS
Anything over $17640 they will with hold $2 for every $3 you make over the $17640. Because of that i didn't take it, i would of screwed myself because you'll lose roughly $400-500 a month starting at 62 instead of FRA (full retirement age), if you have a child under 18 they will get about 50% of yours until they turn 18 and if they are under 16 when you retire your wife will also get about 50% of yours as a care giver for them until they are 16
In the year of your FRA you can make up too about $48,000 (rough number) before they deduct anything and if you make over $48,000 they only with hold $1 for every $3
I didnt study medicare or anything the SS was enough for now

[Mr. Jelly]

Medicare insurance is a deep subject. First you must do a deep dive into any and all information concerning Medicare and all the ins and outs. Then make some decisions. What worked for us was calling a Medicare insurance broker. They do not charge or make any money from you or the amounts you pay for your insurance. What they do is line you up with the least expensive Medicare insurance available to you in your specific area. They do not sell or explain anything. You must decide what parts you want to purchase. We went with A, B, D and G.

What insurance companies charge for the different parts (A, B, D, F, G) of insurance varies a lot. There is no difference in the insurance as it is regulated (there's that word again) by the government. The differences in what's charged may range from $134 to $1,340 for the same insurance.

[catdaddy]

Originally Posted by Mr. Jelly

Medicare insurance is a deep subject. First you must do a deep dive into any and all information concerning Medicare and all the ins and outs. Then make some decisions. What worked for us was calling a Medicare insurance broker. They do not charge or make any money from you or the amounts you pay for your insurance. What they do is line you up with the least expensive Medicare insurance available to you in your specific area. They do not sell or explain anything. You must decide what parts you want to purchase. We went with A, B, D and G.

What insurance companies charge for the different parts (A, B, D, F, G) of insurance varies a lot. There is no difference in the insurance as it is regulated (there's that word again) by the government. The differences in what's charged may range from $134 to $1,340 for the same insurance.

To avoid some confusion involving the alphabetical designations for Parts and Plans related to Medicare, I would like to mention that the bolded above is correct and quite important, but needs clarification. Those "parts" A,B,D,F,G are referring to Medicare supplement plans (or Medigap plans) that are offered by private insurance companies to accompany Medicare Parts A and B. It's important not to confuse or conflate the two.

Medicare Parts A and B (also known as traditional Medicare) is offered only by the Federal Government. What a person pays in the way of premiums for that is dependent on several factors such as one's age and the age at which one elects to participate in Medicare. One pays the government for Medicare Part B only, because Part A is free.

Medicare supplement plans are offered by private insurers, and are strictly regulated by the Federal Government in terms of what these supplemental plans must cover, but there is no regulation on what a private insurer must charge for any offered plan. There are currently 10 Federally regulated Medigap plans that an insurer can offer; they are: A,B,C,D,F,G,K,L,M,N. In January of 2020 plans C and F will no longer be available (although those folks who have them now can keep them on an ongoing basis as long as they wish). These plans all have some basic things in common and then specific coverage incentives are added to distinguish one plan from another. Of course the more complete the supplemental coverage the more expensive it will be. Perhaps the most important thing to note about these plans is what Mr Jelly has mentioned regarding what is being charged for these plans by different private insurers. The plans do not differ from one insurer to another. They can't because the coverage is strictly controlled by the Federal Government, but that doesn't prevent one insurer from charging you A LOT more for the same coverage as another insurer. It is very important to shop for any Medicare supplemental plan!!

[FLRon]

I turn 65 meet March and my mailbox is being bombarded daily by Medicare supplements mailings. I had no idea that this was so confusing and complicated. I know about part A, and not much else. All of these “letter” programs are indicative of a government ran program(hope that’s allowed) because it is unnecessarily complex. I plan to seek help from a broker in my neighborhood or at the local senior center.

[gfirob]

I would add a wrinkle to this, which is that (at least in my case) retirement meant selling my house and moving to another state and pretty much a whole new life. This also meant a fairly radical downsizing, and reduction in my accustomed standard of living. My pre-retirement life was in a big 7 bedroom house in a city with a swimming pool and a lot of international travel. My retirement life is in a much more modest house in central Vermont, with a much more modest life, in comparison. I retired at 68 and self financed my life until I was 70 for max SS.

I really like my new life, but it required a lot of adjustment, psychological and otherwise. Expenses I once took for granted are long gone ($60 haircuts, for instance). I like the change to a more modest existence, but it took some getting used to.

I found this change more challenging, or at least more work, than the financial and health care decisions, many of which were made in consultation with professionals.

[Murphy Slaw]

Originally Posted by FLRon

I had no idea that this was so confusing and complicated.

Nor did I.

It's ridiculous.

[AX17609]

Originally Posted by Murphy Slaw

Only the Government could turn retirement into work......

This is the sort of political comment that's allowed here. But, if I respond, I'll be the one who is censured.

The government didn't turn retirement into work; the government made it possible for millions of Americans to retire from work. The complexities of the issue are related to 1) personal finance and 2) medical coverage. The issues with the first have followed us our whole lives and are approached no differently as retirement approaches. The complexities of the latter are generated entirely by the medical provider community, which profits from confusion.

In my experience, the only defenses you have against assertive medical practices are 1) a personal knowledge of medicine and 2) your insurance company, which fights against rising costs. My profession gave me a lot of the former. I grow more and more appreciative of the latter with each passing year of retirement. My insurance company has come to my defense on numerous occasions.