Social Security And Medicare: Determine When To Take Your Best (…and Only) Shot

For seniors, Social Security and Medicare are arguably two of the most prominent issues. These two issues are confusing and complicated, but nonetheless, decisions that need to be made. The average working couple today will receive approximately $1,500,000 in Social Security benefits. For Medicare, depending on which avenue you choose – whether it’s Traditional Medicare or an Advantage Plan – could have an enormous impact on your medical costs. To make matters worse, you only get one shot at making the right decision for both issues. Talk about pressure!

Issues that need to be addressed for Social Security:

• What is your primary insurance amount?
• Are you single or married?
• Are you considered disabled?
• Are you divorced and if so, were you married at least 10 years to your ex-spouse?
• Are you currently working and how long do you plan on working?
• Do you plan to live to 80?
• Are you in good or poor health?
• Do you need the cash flow now?
• Do you have a “non-covered” pension from another government entity?
• Do you have unmarried children under 19 and any full-time students?
• Do you have a disabled child?
• Will you be subject to the annual earnings limitation?
• Can you take advantage of the “restricted application”?
• Should you take retroactive benefits?
• Should you voluntarily suspend benefits?
• Should you take advantage of delayed retirement credits?
• Do you want to maximize survivor benefits for your spouse?

Issues that need to be addressed for Medicare:

• Do I need to file at 65?
• What are the various enrollment periods?
• Why is October 15 to December 7 so important?
• What are Medicare Part A, B, C and D?
• What does Medicare cover?
• Should my spouse have a different plan?
• Should I choose traditional Medicare with a Supplement or choose an Advantage Plan (Part C)?
• What Supplement plan should I purchase? Plan G and Plan N seem to be the two most popular now.
• Should I (or can I) switch plans?
• Can I delay Medicare without penalties?
• What drug plan should I choose?
• When can I change my drug plan?
• Can claims be denied?
• Will IRMAA (Income Related Material Adjustment Amount) affect my premiums?
• What are the most common errors when filing for Medicare?

As you can see there are a multitude of issues that need to be considered for both Social Security and Medicare. The list of issues is not intended to be a comprehensive list, and every situation is different. Medicare is strictly an individual decision, whereas Social Security is also an individual decision, but the benefits can be coordinated using joint life expectancies to produce the greatest overall lifetime income stream. The point of this article is that you should not make these two especially important decisions on your own. Seek professional guidance and provide yourself the peace of mind that you have considered all your options and made the correct decision for you and/or your spouse.

By Thomas Hager, Contributor