Published by: PGIA
At age 65, you’re either retired or planning to retire soon. You might be focused on financial matters, but it’s important to remember that healthcare is a financial matter, especially during retirement. At age 65, you’re required (in most cases) to enroll in Medicare. Here’s what you need to do as that milestone approaches.
Get an estimate of your Social Security benefits. Contact a Social Security representative or your financial planner to obtain an estimate of your future Social Security benefits. This person can help you understand how much you can expect to receive each month (hopefully in addition to another form of retirement income that you have established). You should also request an estimate of your benefits if you retire at different times – at full retirement age, early, and late. You can receive a higher benefit check the longer that you wait to retire, up to age 70.
Plan for income taxes in retirement. Sorry to disappoint you, but income taxes will still be a part of your life after you retire. Some forms of retirement income are taxable, and of course, some retirees opt to continue working part-time. Another thing to consider is that in certain circumstances, your Social Security benefits could be taxed as well. You need to plan for this part of your budget so that you don’t receive any unpleasant surprises.
Evaluate your Medicare options. You’re required to enroll in Medicare when you reach age 65 unless you’re still working for a company with more than 50 employees and covered by their group healthcare plan. If you don’t enroll in Medicare on time, you will pay higher premiums later.
But Medicare enrollment isn’t as simple as going online or picking up the phone. You have the choice of several different healthcare plans, each one structured a bit differently and serving a different purpose. For example, you will first choose between Original Medicare (managed by the federal government) or Medicare Advantage (operated on a network and administered by a private health insurance company). Then you might add supplementary types of insurance, depending upon your needs. Other options are available as well, such as Special Needs Plans which are created for people with certain medical conditions.
No Medicare plan works perfectly for everyone, so your choice should suit your own needs.