Another thread about money......for those receiving S.S.

[wyliec]

Received good news today. Social Security monthly payment is going up. The percent is good enough for me. What surprised was, I've seen Medicare monthly payment go up the same amount dollar wise, in the past; this time, we get almost the whole amount of the SS increase, except for a $1.50.

[Bob Denman]

[Chupaca]

Have not seen anything as yet but the last time they adjusted mine it went down....Glad yours is going up and fingers crossed mine will stay the same or go up as well.... congrats...

[2Paw]

Hope mine goes up as well.

[wyliec]

You must still be working and haven't reached full retirement age? I'm just guessing. I'm past full retirement age, and still working a few days a month, and don't have to worry about being penalized with a reduction.

[pegasus1300]

I too got a nice raise and all of my Payee clients got one as well. I also noticed that medicare did not take the obligatory equal raise. Happy daz are here again.

[canamjhb]

Yah, Last time there was an announcement of the SS increase. Yippie....! Then, they raise the Medicare amount that just happened to equal the SS increase. A lot of bureaucratic nonsense. Could have saved us a bunch of money by just saying "nevermind". Looks like this year may be a bit better. Hope so..... Jim

[ARtraveler]

Retirement is great. My finances are now better.

[johnsimion]

Received good news today. Social Security monthly payment is going up. The percent is good enough for me. What surprised was, I've seen Medicare monthly payment go up the same amount dollar wise, in the past; this time, we get almost the whole amount of the SS increase, except for a $1.50.

I'm not yet old enough for SS or Medicare, but I'm close enough to be interested. I'm confused by this thread. Can you explain what is the "Medicare monthly payment"? I thought Medicare was a benefit you got without having to make a monthly payment. And what does this mean: "we get almost the whole amount of the SS increase, except for a $1.50"?

[newbert]

I'm not yet old enough for SS or Medicare, but I'm close enough to be interested. I'm confused by this thread. Can you explain what is the "Medicare monthly payment"? I thought Medicare was a benefit you got without having to make a monthly payment. And what does this mean: "we get almost the whole amount of the SS increase, except for a $1.50"?

Part A (Hospitalization) Medicare requires no monthly payment. Everything else does. For example, Part B (Doctor visits, etc.) requires a monthly payment (which comes out of SS). I think mine's been $135 this year and it's going up $1.50/month next year.

Those are just the highlights. Medicare is complicated. Be sure to do your research when signing up.

I hope this helps a bit.

[ARtraveler]

RE: Medicare Monthly Payment. Medicare deducts a monthly amount from the gross SS check--so in essence, it is not totally free. It is not bad though. I had over $250,000 in medical expenses a couple years back, it cost me about $10K out of my pocket that year. MC covered the rest.

[IdahoMtnSpyder]

I'm not yet old enough for SS or Medicare, but I'm close enough to be interested. I'm confused by this thread. Can you explain what is the "Medicare monthly payment"? I thought Medicare was a benefit you got without having to make a monthly payment. And what does this mean: "we get almost the whole amount of the SS increase, except for a $1.50"?

As newbert said, do your homework and study it all closely. The big one is original Medicare versus Medicare Advantage plans. And then there are Medigap, or supplemental plan out there. And your employer's insurance may play a part. I trust you realize your full retirement age is 67, not 65, although Medicare becomes available at 65. Confusing enough for you yet? That's why it's never too early to start learning about it!

[bikerbillone]

Received good news today. Social Security monthly payment is going up. The percent is good enough for me. What surprised was, I've seen Medicare monthly payment go up the same amount dollar wise, in the past; this time, we get almost the whole amount of the SS increase, except for a $1.50.

I feel your pain, mine was an exact wash, guess I should be thankful.

[jcthorne]

As newbert said, do your homework and study it all closely. The big one is original Medicare versus Medicare Advantage plans. And then there are Medigap, or supplemental plan out there. And your employer's insurance may play a part. I trust you realize your full retirement age is 67, not 65, although Medicare becomes available at 65. Confusing enough for you yet? That's why it's never too early to start learning about it!

Not sure what you mean about retirement age being 67 vs 65. SS can start at 62 if you want and medicare at 65. For me, the big one is Medicare. Health insurance for the wife and I is nearly 25k a year so I cannot retire until medicare takes that on. Have not decided when to start SS.

[wyliec]

As newbert said, do your homework and study it all closely. The big one is original Medicare versus Medicare Advantage plans. And then there are Medigap, or supplemental plan out there. And your employer's insurance may play a part. I trust you realize your full retirement age is 67, not 65, although Medicare becomes available at 65. Confusing enough for you yet? That's why it's never too early to start learning about it!

johnsimion,

I'm retired military, and up until I was 65 I had Tricare Prime health insurance (a freebie from being retired military), at that point I was automatically enrolled in Tricare for Life, IF and only IF I had Medicare part B, which you have to pay for, as others have mentioned. So, in my case the supplemental stuff that Idaho mentions, I didn't find it necessary to deal with. Also, I chose to start drawing my S.S. at 62, which was at a reduced rate, but I also continued to work, when I felt like it, keeping me just below the threshold of having to pay back some S.S.

Just as an aside, when you are told Tricare is free, it really is not, not when you hit 65. However, I'm not complaining; others have to pay a lot more to maintain a reasonable amount of health coverage into their golden years.

[wyliec]

Not sure what you mean about retirement age being 67 vs 65. SS can start at 62 if you want and medicare at 65. For me, the big one is Medicare. Health insurance for the wife and I is nearly 25k a year so I cannot retire until medicare takes that on. Have not decided when to start SS.

Full retirement age for S.S. is based on the year you were born; age 65 is when you start with medicare.


https://www.ssa.gov/planners/retire/agereduction.html

[BLUEKNIGHT911]

Not sure what you mean about retirement age being 67 vs 65. SS can start at 62 if you want and medicare at 65. For me, the big one is Medicare. Health insurance for the wife and I is nearly 25k a year so I cannot retire until medicare takes that on. Have not decided when to start SS.

JC, " on the when to start " thing …… for you and others who are trying to figure this out. ….. Do the Math - for me if I had waited till I was 70 ….. I would have to have reached 82 ( 12 yrs ) for the money numbers to break even. After that I would actually begin to benefit from the 70+ max amount. The SS administration has done the Math on this and they have the actuarial's that show They SAVE money if folks wait till they are 70...… IMHO do the math…………...Mike

[Easy Rider]

Do the Math - for me if I had waited till I was 70 ….. I would have to have reached 82 ( 12 yrs ) for the money numbers to break even.

I didn't do the math that far.
I figured that with my luck, if I waited until 70, that I would die at 69 years and 11 months.......and get a big NOTHING.

I passed that milestone but glad to hear that I made the right decision anyway.

[Bob Denman]

I'm waiting until I hit 66 years, and 4 Months: That's when nobody will want to be in the way of me retiring.
62, and 2+ Months now: and counting!

[IdahoMtnSpyder]

JC, " on the when to start " thing …… for you and others who are trying to figure this out. ….. Do the Math - for me if I had waited till I was 70 ….. I would have to have reached 82 ( 12 yrs ) for the money numbers to break even. After that I would actually begin to benefit from the 70+ max amount. The SS administration has done the Math on this and they have the actuarial's that show They SAVE money if folks wait till they are 70...… IMHO do the math…………...Mike

I've said for years the one mistake the Reagan administration made when they pushed the SS reform back in 1984 was not make a significant change in the crossover calculation, i.e., the year after which your total SS benefit would be greater by delaying retirement. For retirement at any age from 62 to the current 66 the crossover is around 78 to 80. Reagan's intent was to create an incentive for delaying retirement but they botched it. The crossover keeps moving out farther the later you retire. They should have made it so that the later you start SS benefits the sooner you reach the crossover age.

In my case the crossover was something like 94 when I calculated it on my and my wife's combined SS benefit. She is four years older than I am and her benefit is based entirely on my earnings, so naturally I opted to start SS at 62. Family history doesn't give me any confidence in getting past 85, or maybe not even 80, let alone 94.

[gkamer]

I don't reach full retirement until Feb so I'll have to wait. My military pension and sheriff's office pension is working fine right now. I figure by the time I start pulling my SS, I'll end up making more then I did when I was actually getting up to go to work every day.

[ARtraveler]

The actuaries have it all figured out.

None of us are going to "beat" the system. The earlier you apply when eligible, the less your monthly payment will be.

The later you apply, your monthly payment is bigger.

However, people will usually end up with close to the same amount paid out by the time you die.

I waited until they told me I had to apply. I believe that was 70.

If you are working you also pay income tax on part of your SS earning.

Idaho in post #25 does a good job of explaining the taxable portion of SS payments.

A good financial adviser is a good thing.

[Bob Denman]

I still think that it's best to just hit on the Powerball lottery...

[kngfsh27]

My health insurance for my wife and I is going up $1.32 a month to $49..50.

[IdahoMtnSpyder]

(ak has deleted the previously quoted text)

There is no age at which it becomes non-taxable. The amount of SS that is taxable depends entirely on a special calculation of combined income. If your AGI + non taxable interest income + 1/2 of your SS benefit exceeds $32,000 for a couple, then 50% of your SS is taxable up to $44,000 combined income. Above $44,000 combined income 85% of your SS benefit is taxed. What that means is the actual amount of the SS benefit that is taxed depends on how much other income you have. If you have $20,000 AGI, no interest income, and $30,000 SS benefit, then 50% of $3000 ($35,000 combined - $32,000 threshold) of the SS benefit is taxed. If you have an AGI of $32,000 and $5000 SS benefit then 50% of the entire $5000 SS benefit is taxable. If you have $44,000 AGI then 85% of your SS benefit is taxed. There is no upper dollar limit.

This page explains it pretty good. https://www.fool.com/retirement/gene...y-taxable.aspx

The taxation of SS benefits is the primary reason I haven't worked part time since retirement. My annuity is mostly taxable, as is my 401k withdrawal. That all exceeds the $44,000 threshold. So if I work every dollar I would earn would add 85 cents of my SS benefit to my taxable income without increasing my income. Add to that the FICA tax that would be taken out and now out every dollar I earn I would get to keep around 60 cents. That's at a federal tax rate of about 15%. I would keep less if I'm in a higher tax bracket. So for a job paying a near minimum wage of $10/hr I would effectively be working for $5/hr. That is a powerful disincentive to work.

There is a common misconception that after you reach full retirement age SS is non-taxable. That is not the case. What happens is for every dollar you earn in wages, after you start taking SS benefits and before you reach full retirement age, you lose 50 cents of your benefit for every dollar you earn above a specified threshold. That restriction stops when you reach full retirement age. After that you can earn as much money as you want in the form of wages without impacting the size of your SS benefit. But, your SS benefit is subject to being taxed per my comments above.

About the only tax reduction scheme left for us ordinary mortals, because of the high increase in standard deduction, is what's called a Qualified Charitable Distribution. If you have your 401k manager cut a check to a charitable organization it will go toward satisfying your minimum distribution requirement and also becomes a non-taxable withdrawal from your 401k fund. This provision is not available for IRA funds.