Make Your Decisions Independently
Collecting Social Security is by no means a prerequisite to getting Medicare. In fact, its often advisable to sign up for Medicare as soon as youre eligible but wait on Social Security to avoid a reduction in benefits, or boost them as much as possible.
The only downside to signing up for Medicare alone is having to make your premium payments directly, as opposed to having them deducted from your Social Security benefits, but its a small price to pay for the upside of a higher lifetime income stream.
Maurie Backman has been writing professionally for well over a decade, and her coverage area runs the gamut from healthcare to personal finance to career advice. Much of her writing these days revolves around retirement and its various components and challenges, including healthcare, Medicare, Social Security, and money management.
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When Should I Sign Up For Medicare
Generally, we advise people to file for Medicare benefits 3 months before age 65. Remember, Medicare benefits can begin no earlier than age 65. If you are already receiving Social Security, you will automatically be enrolled in Medicare Parts A and B without an additional application. However, because you must pay a premium for Part B coverage, you have the option of turning it down. You will receive a Medicare card about two months before age 65. If you would like to file for Medicare only, you can apply by calling 1-800-772-1213. Our representatives there can make an appointment for you at any convenient Social Security office and advise you what to bring with you. When you apply for Medicare, we often also take an application for monthly benefits. You can apply for retirement benefits online.
If you didnt sign up when you were first eligible for Medicare, you can sign up during the General Enrollment Period between January 1 and March 31 each year, unless you are eligible for a Special Enrollment Period.
Who Will Pay For Your Health Care In Retirement
Who will pay for your health care expenses in retirement? This is a good question, whether retirement is just around the corner oreven if it is still far off in the future. Maybe your answer is Medicare will pay for it. And thats partly true, with emphasis on partly. Medicare, the nations federal health insurance program for people over the age of 65, pays benefits if you are eligible for Social Security. If youve noticed the term FICA on your pay stub that stands for Federal Insurance Contributions Act youve been paying into Medicare.
But heres the rub: Medicare covers some medical expenses, but not everything. And it isnt free you pay Medicare premiums in retirement,and these premiums can increase as the years go by, as can your out-of-pocket expenses. Thats why you need to be thinking about having a plan to cover your health care costs beyond Medicare.
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Ssa Benefits And Medicare
So lets go back to how your full retirement age and Medicare may interact. The biggest thing is that in the past, at age 65, you both got your SSA benefits and became Medicare eligible. This meant you could use your SSA benefits to help pay for Medicare. However, with the full retirement age being at least a year or more past 65, you need to think carefully about when you take your SSA benefits if you want to use them for Medicare costs.
How Medicare Works If Your Age 62 Spouse Is Still Working And Youre On Medicare
To qualify for Medicare, your spouse must be age 65 or older. If your spouse is age 62 , he or she could only qualify for Medicare by disability.
Heres an example of when a younger spouse whos not yet on Medicare might help you save money.
- Suppose you reach age 65 and qualify for Medicare, but you havent worked long enough to qualify for premium-free Medicare Part A.
- And suppose your younger spouse has worked at least 10 years while paying Medicare taxes. When your spouse turns 62, youll qualify for premium-free Part A. Your spouse wont qualify for Medicare until they turn 65, but their work record will help you save money by getting Part A with no monthly premium.
NEW TO MEDICARE?
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Reason #: Retire At 62 If You Want To Learn New Things
If you devoted your education and life to a focused career, there might come a point when you want to try something completely new. Taking retirement at 62 means you have time to pursue education in a different direction, and still have time to use and enjoy it.
Adult students typically perform better than their younger counterparts. And, even if you dont pursue a new degree to use in the workforce, learning for personal edification can be rewarding. You might even gain a new skill set to use in starting a business of your own.
When Can You Claim Social Security
The right age to claim all depends on you. Americans can file for Social Security as early as 62 years old. If you file at 62, it’s a move that could drastically reduce the total amount you could otherwise receive over your lifetime, and over the lifetime of a surviving spouse. This is an especially important consideration for women, who tend to live longer and earn less than men.
Here’s why timing is everything: 1
Early claiming: You can collect a Social Security retirement benefit as early as age 62. But if you do claim early, your benefits will be reduced by as much as 25% to 30% depending on when you were born. For example, if you are eligible for $1,000 a month at full retirement age, you might get only $750 a month at age 62. The reduction in benefits due to early filing will be less for each year you delay your filing between age 62 and your “full retirement age.”
Full retirement age: What does the Social Security Administration mean when it refers to your “full retirement age?” It’s the age at which you’re able to claim full benefits, and it varies based on the year you were born. Its age 66 for people born from 1943 to 1954, and it gradually increases to 67 for those born in 1960 or later.
More factors: The right age to claim also depends on your work plans in retirement, your health, and the rest of your retirement income. Delaying a claim for as long as possible could make sense for some people, but there are cases where early retirement is the better option.
Can A 62 Year Old Get Medicaid
Yes. Medicaid qualification is based on income, not age. While Medicaid eligibility differs from one state to another, it is typically available to people of lower incomes and resources including pregnant women, the disabled, the elderly and children.
Learn more about the difference between Medicare and Medicaid.
Financial Benefits Of Working Longer
Many people want to retire as soon as it is financially feasible to do so, but it’s crucial to consider the earning and investing power you may give up if you stop working full-time and take Social Security at 62. If you leave a job with good pay and benefits, it may be difficult ever to regain that level of compensation if you need or want to return to work later. Of course, not everyone can keep working, but it is something to consider if you are healthy and have the opportunity to stay in the workforce, in either a full-time or part-time capacity.
The compensation benefits of your job could also affect your Social Security. Some companies allow stock awards to continue to vest after retirement date, and even into years to follow. These payouts are considered income, and could cause your Social Security payment to be taxed, or taxed at a higher level than in years after the awards have fully distributed. Delaying Social Security payments until those other income sources have been reported for tax purposes is worth consideration.
But there’s even more to the story. As you approach retirement, you’re often at the upper end of your lifetime earnings trajectoryand of your ability to save more for retirement. In addition, if you can keep working, you can make “catch-up” contributions to a tax-deferred workplace savings plan like a 401 or 403 or a traditional or Roth IRA. Catch-up contributions allow you to set aside larger amounts of money for retirement.
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Weigh In: What Do You Think Of Proposals To Lower Medicares Age Requirement To 62 Or Less
So now Id like to hear from you. Do you think lowering the initial age of Medicare eligibility is a good idea? Would you be more apt to support Medicare at 62 so it would line up with Social Securitys eligibility age? Id like to hear your thoughts in the comments below.
Dont leave without downloading my Social Security cheat sheet. Its completely free and packed with information that Ive distilled from thousands of government website pages.
Also, if you havent already, you should join the other 330,000 subscribers on my YouTube channel. If youre subscribed with notifications turned on, youll know as soon as I release a new video. See you there!
What To Consider Before Filing For Social Security
A larger benefit check sounds great, but there are tradeoffs, and soon-to-retire folks should consider multiple issues before they decide one way or the other on when to file. If you really want to consider all the avenues, then youll have to think about your finances and longevity two issues that people have a hard time grappling with.
But heres the key trade-off: you can file early and take a reduced benefit, expecting that a shorter life span will mean you receive more now, or you could file at full retirement age or later and claim a bigger check, and eventually live long enough to claim more than the first approach.
Social Security is like longevity insurance, says Brent Neiser, a Certified Financial Planner and former chair of the Consumer Advisory Board at the Consumer Financial Protection Bureau. Its a stream of payments that will not stop throughout your life, so delaying your benefits to keep those payments as large as possible forms a helpful base to your retirement plan.
Neiser urges those who have not saved enough for retirement to use whatever means possible to postpone their Social Security benefits until after their full retirement age to help boost their future income.
You can use personal savings to help bridge the gap, but ideally you should plan to work a little longer , Neiser says.
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If I Retire At Age 62 Will I Be Eligible For Medicare At That Time
Medicare is federal health insurance for people 65 or older, some younger people with disabilities, and people with end-stage kidney disease. Most commonly, you are eligible for Medicare when you turn 65, but there are other health insurance options if you are younger and do not have coverage through you or your spouses employer.
What you should know
|1. The typical age requirement for Medicare is 65, unless you qualify because you have a disability.||2. If you retire before 65, you may be eligible for Social Security benefits starting at age 62, but you are not eligible for Medicare.|
|3. You have options for health insurance if you are too young for Medicare. You may obtain it through your employer, or you can purchase from private-sector insurance companies through the health insurance exchange. You may be eligible for Medicaid, which is based on income.||4. If you retire before you are 65, you may be eligible for employer-provided group health insurance under the Consolidated Omnibus Budget Reconciliation Act .|
Medicare was established in 1965 in order to provide health coverage for seniors who would otherwise not be covered by employer-sponsored health insurance plans. If you retire at the age of 62, you may be eligible for retirement benefits through social security, but early retirement will not make you eligible for Medicare.
Social Security Benefits And Retiring At Age 62
If youre considering retiring at 62, its likely that Social Security is one of your primary concerns. Thats because 62 is the first year youre eligible to receive Social Security benefits, but your benefit will be lower than if youd waited longer to start receiving those benefits.
Normally, youd need to reach your full retirement age, which for most people is 66 or 67, to qualify for the full monthly benefit amount. And to get the largest possible benefit youd need to wait until age 70. Taking benefits at age 62, or at any time between 62 and your full retirement age would reduce your benefit amount.
The amount of the reduction depends on the year you were born. For example, if you were born in 1960 or later, taking Social Security benefits at age 62 would reduce your monthly benefit by 30%. If youre married and spousal benefits are also being paid, those benefits would be reduced by 35%. So for example, if youre anticipating a $1,000 monthly Social Security payment and your spouse is expecting $500, your benefits would be reduced to $700 and $325, respectively. This Social Security calculator can tell you what you can expect to receive, based on your age and when you begin taking benefits.
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Medicare Doesn’t Kick In Until 65
Medicare benefits dont start until you turn 65. If you retire at 62, youll need to make sure you can afford health insurance until age 65 when your Medicare benefits begin.
With the Affordable Care Act, you are guaranteed to get coverage even if you have a pre-existing condition. You also can’t be charged more than someone who is healthier. But health insurance pricing can vary by location. Many retirees whose employers paid for their insurance get caught off guard by how expensive it can be.
Also, keep in mind that Medicare does not cover all healthcare costs. Many people purchase additional health coverage to supplement their Medicare benefits. Get quotes on your health insurance costs. Build that expense into your retirement budget.
Retiring At 62 Or Before 9 Ways To Cover Your Health Costs For An Early Retirement
There are a lot of hurdles to overcome when figuring out how to retire early before 65. However, early retirement health care is one of the most fiscally challenging. Medical care is going to be expensive no matter when you retire, but the picture is more serious for those who retire early, by choice or otherwise.
Medicare isnt available until age 65 and self-insurance in your 40s, 50s, and 60s can be prohibitively expensive. Never mind that you typically face more health challenges as you age and are therefore more likely to use health care.
Use the NewRetirement Retirement Planner to find out now if you can afford an early retirement and explore the following 9 possibilities for how to cover early retirement health care costs:
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How Old Do You Have To Be To Get Medicare
Are you wondering at what age you can get Medicare coverage? You could say that Medicare age ranges from 65 up, for the rest of your life, for most people in the U.S. If you qualify for Medicare by disability, you can get Medicare before age 65. Youâre generally eligible for Medicare if youâre younger than 65, and:
- Youâve been getting Social Security disability benefits for at least 24 months. Youâre typically signed up for Medicare automatically when you start the 25th
- You have end-stage renal disease . You might qualify for Medicare, but youâre not automatically signed up. You need to contact Social Security or visit their website, gov.
- You have amyotrophic lateral sclerosis , also known as Lou Gehrigâs disease. Youâre automatically signed up for Medicare the same month your Social Security disability benefits start.
Who Is Eligible For Medicare
Generally, Medicare is available for people age 65 or older, younger people with disabilities and people with End Stage Renal Disease . Medicare has two parts, Part A and Part B . You are eligible for premium-free Part A if you are age 65 or older and you or your spouse worked and paid Medicare taxes for at least 10 years. You can get Part A at age 65 without having to pay premiums if:
- You are receiving retirement benefits from Social Security or the Railroad Retirement Board.
- You are eligible to receive Social Security or Railroad benefits but you have not yet filed for them.
- You or your spouse had Medicare-covered government employment.
To find out if you are eligible and your expected premium, go the Medicare.gov eligibility tool.
If you did not pay Medicare taxes while you worked, and you are age 65 or older and a citizen or permanent resident of the United States, you may be able to buy Part A. If you are under age 65, you can get Part A without having to pay premiums if:
- You have been entitled to Social Security or Railroad Retirement Board disability benefits for 24 months.
- You are a kidney dialysis or kidney transplant patient.
While most people do not have to pay a premium for Part A, everyone must pay for Part B if they want it. This monthly premium is deducted from your Social Security, Railroad Retirement, or Civil Service Retirement check. If you do not get any of these payments, Medicare sends you a bill for your Part B premium every 3 months.
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