What You Should Know When Approaching Medicare for the First Time

Whether you’re still working or retiring, make informed choices as you turn 65

 You’ve been diligently saving for retirement, your portfolio is in great shape, and you’ve finally informed your employer that your last day of work is here. Congratulations! But now what?

For many of our clients (many of them retirees around Tucson and Phoenix, AZ areas) the transition from full-time work to retirement involves navigating several new processes. One very important item to understand? Medicare.

Here are three essential scenarios to help you think about transitioning to Medicare or fine-tuning your coverage based on our experience assisting clients and in partnership with our friends at Senior Advisors (whose services are 100% free as insurance carriers pay them directly):

1.     Approaching 65 and still working?

As you approach 65, it's important to speak with a specialist to help determine whether to enroll in Medicare. There are many factors to consider with this decision; expert guidance is recommended as mistakes can have lifetime implications.

• If you have group coverage with an employer that has 20 or more employees:

  • You are not required to enroll in Medicare and do not need to enroll in Medicare Part A or Medicare Part B

  • There will not be penalties associated with this decision

  • You can and should evaluate whether or not Medicare is of value to you going forward

• If you have group coverage with an employer that has less than 20 employees:

  • You should be enrolling in Medicare Parts A and B

  • In this situation, Medicare will become the primary payer of your health bills, so if you have not enrolled in Medicare you will be exposed to 80% of your provider’s bills

• Here is a great, 3-min. video with details on both scenarios

2.     Over 65 and retiring?

When retiring, its critical to understand your Medicare options, and develop a plan for Medicare as early as possible. In addition to establishing an understanding of your future health insurance and the costs associated with it, you may need to evaluate your HSA contributions to avoid penalties.

3.     Already enrolled in Medicare?

Enrolling in Medicare and not taking action to evaluate your coverage in the future can mean that you are overpaying for healthcare and medications. This link speaks to Medicare savings opportunities.

“Too many people enroll in Medicare and never evaluate their coverage going forward,” says Adam Lubenow with Senior Advisors. “This can result in overpaying for coverage and medications. There can be significant savings opportunities, schedule a call if you would like our help with evaluating savings opportunities.”

For many, the primary focus of working with a wealth manager like Retirement Consultants is saving for retirement. However, the transition itself is just as critical as the preparation. Collaborating with a fiduciary that’s already working with trusted Medicare advisors can make a significant difference. Be sure to discuss Medicare and other important topics with your advisor before you retire, or feel free to email me to discuss further!