Results for "On Retirement"

Oct 15, 2019, 12:37 PM EST

Medicare 2020 open enrollment begins Tuesday

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By Mary Beth Franklin

Medicare open enrollment for health care coverage in 2020 begins Tuesday, Oct. 15. While most of the 60 million Medicare beneficiaries enrolled in the nation's primary health insurance program for retirees and people with disabilities usually ignore the annual opportunity to re-shop their coverage, they may want to pay special attention this year.During the annual open enrollment season, which runs through Dec. 7, Medicare beneficiaries can switch health and drug plans for 2020, with coverage beginning on Jan. 1. If they do nothing, they will continue in their current plan."Plans change and your needs change," the Centers for Medicare and Medicaid Services noted in a recent blog highlighting the importance of the 2020 open enrollment season. New rules take effect next year governing prescription drug coverage, changes in out-of-pocket costs, expanded benefits under Medicare Advantage plans and the elimination of some popular... Read full post

Sep 30, 2019, 3:32 PM EST

A new twist on Medicare open enrollment

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By Mary Beth Franklin

Many of your retired or soon-to-be retired clients probably think of enrolling in Medicare as a once-in-a-lifetime event that's timed to coincide with their retirement date and Social Security claiming decisions. But such a set-it-and-forget-it attitude about health care coverage options in retirement can be a costly mistake.​ Each year, insurance companies can make changes to Medicare plans that affect out-of-pocket costs for monthly premiums, deductibles, drug costs and health care provider networks and pharmacies. Medicare beneficiaries have the opportunity to re-shop their health care and drug coverage choices during the annual open enrollment season which runs from Oct. 15 through Dec. 7 every year for coverage that begins the following Jan. 1. In reality, few do.The stakes are higher than usual during this year's open enrollment period because there are new rules for prescription drug coverage, changes for new enrollees ... Read full post

Sep 16, 2019, 4:51 PM EST

Medicare IRMAA surcharges to be adjusted for inflation in 2020

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By Mary Beth Franklin

For the first time in a decade, the income brackets used to determine Medicare premium surcharges for high-income retirees will be indexed to inflation starting Jan. 1. As a result, some retirees may experience a reduction in their Medicare surcharge costs next year.Beginning Jan. 1, the income related monthly adjustment amount brackets used to determine high-income surcharges for individuals and married couples will be indexed to the consumer price index based on the 12-month CPI change from September 2018 through August 2019. In August, inflation increased 1.7% over the previous 12 months, according to the CPI data released last Thursday. As a result, the income brackets used to determine Medicare surcharges in 2020 will increase by 1.7%, rounded to the nearest $1,000. In general, that means income tiers will increase by $1,000 to $3,000 for individuals and by $2,000 to $6,000 for married couples filing jointly, according to a new... Read full post

Sep 9, 2019, 5:11 PM EST

A Social Security workaround for some divorced spouses

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By Mary Beth Franklin

I stumbled upon another nuanced exception to the myriad Social Security rules that affect divorced clients thanks to the astute question of an InvestmentNews reader. Think of this as the Social Security edition of Trivial Pursuit, a game that taxes players' memory and retention of minutiae. This question certainly tested mine.An adviser from Chicago asked me for help crafting a Social Security claiming strategy for two of her currently single clients who plan to marry each other. The soon-to-be bride is 62 and single. Her future husband is 68 and divorced. Neither of them has claimed Social Security yet."If they got married, it would make sense for her to take her own benefits and for him to claim a spousal benefit on her earnings record until he reaches age 70," the adviser wrote.I agree, assuming the 62-year-old wife is not working. Otherwise, she would be subject to earnings restrictions that could temporarily reduce or even... Read full post

Sep 3, 2019, 6:06 PM EST

Creating time-tested retirement income plans

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By Mary Beth Franklin

I usually set aside Labor Day for reflection, not just about the official end of summer, but about broader topics that I encounter as a columnist for InvestmentNews. So I was thrilled when two veteran financial advisers I admire — Phil Lubinski and Paul Reasoner — agreed to share the wisdom they've gained from working with hundreds of clients over the past 35 years to create and manage retirement income plans that have stood the test of time.With millions of baby boomers moving into retirement with trillions of dollars of assets that need to be converted into income, the opportunity has never been bigger for the financial services industry. But this opportunity presents its own challenges. "Clearly the most significant problem facing both clients and advisers is the lack of certainty of the distribution strategy of an income portfolio," said Mr. Reasoner, founder of Compass Wealth Advisor in Elkhart, Ind. , and creator of ... Read full post

Aug 26, 2019, 4:16 PM EST

When to buy Medigap insurance

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By Mary Beth Franklin

I have often written about the importance of clients enrolling in Medicare at the right time to ensure that they are not stuck paying delayed enrollment penalties for the rest of their lives. What may be less obvious, but equally important, is the need to buy a supplemental Medigap policy when you're first eligible to guarantee coverage, regardless of your health status.Medicare supplemental insurance policies, also known as Medigap policies, are sold by private companies and help pay some of the health care costs that original Medicare doesn't cover, such as copayments, coinsurance, deductibles and, in some cases, medical care when traveling outside the United States. But Medigap policies don't cover everything. They generally do not cover long-term care, vision or dental care, hearing aids or eyeglasses.Before you can buy a Medigap policy, you first must enroll in Medicare Part A and Part B. Medicare has a seven-month initial... Read full post

Aug 19, 2019, 12:24 PM EST

Social Security rules for nonworking spouses

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By Mary Beth Franklin

Financial advisers often ask me how to maximize Social Security benefits based on the ages and relative retirement benefits of each spouse in a dual-income couple, which is a typical client profile today. But for much of Social Security's 84-year history, one-breadwinner families with a stay-at-home spouse were the norm and the program's benefit structure still favors this Ozzie-and-Harriet style family.Two-income households often pay more in Social Security taxes than a one-income household with the same level of income but reap smaller benefits per dollar of taxes paid. That's because the federal government only collects Social Security taxes on an individual's income up to a certain threshold ($132,900 in 2019).If a one-income household earned $200,000 this year, its Social Security tax bill would be $8,240 ($132,900 x 6.2% payroll tax rate for employees.) If a two-income household earned the same $200,000 split evenly between the... Read full post

Aug 6, 2019, 11:34 AM EST

Social Security and Medicare issues get personal

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By Mary Beth Franklin

From time to time, I write a "dispatch from the retirement front" based on personal insights from living with a retired husband or fielding questions during girlfriend getaways about enrolling in Medicare and claiming Social Security benefits.This summer I had my own brush with contemplating the future of retirement — both from a national policy standpoint, as well as on a more personal level. Don't worry. I'm not retiring any time soon. But following some major surgery in July, I was forced to slow down. For a few weeks, I perfected the art of doing nothing and wondered whether this is what retirement would be like for me.My first decision was whether to delay my surgery until December when I would qualify for Medicare and could significantly reduce my out-of-pocket costs for the procedure or to get it over with this summer when my business travel schedule for speaking engagements tends to be lighter. After weighing the pros... Read full post

Jul 23, 2019, 1:00 PM EST

Social Security has special rules for divorce

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By Mary Beth Franklin

No one would deny that Social Security is complicated. With about 2,700 rules governing benefits, it is no wonder that financial advisers and their clients are often confused by the best way to maximize benefits. When it comes to divorced clients, multiply that confusion times two.As Social Security claiming strategies have become a standard part of retirement income planning over the past few years, many financial advisers now understand the basic Social Security rules for divorced spouses: As long as a couple was married for at least 10 years before divorcing, an ex-spouse who is currently single can collect Social Security benefits as if he or she were still married — even if the other ex-spouse has remarried.It's the nuances of the Social Security divorce rules that are so tricky. In some ways, divorced spouses have more claiming opportunities than married couples, depending on their birth dates and how long they have been... Read full post

Jul 16, 2019, 10:17 AM EST

Women in two-income households face greatest retirement risk

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By Mary Beth Franklin

For years, I've been writing about the retirement challenges that women face as a result of their longer average lifespans, lower lifetime earnings and the fact that most women end up alone as a result of divorce, widowhood or never having married. In fact, it was one of the central themes of the InvestmentNews​ Women Adviser Summit in Boston last week: Single women often face bleaker retirement prospects than their married counterparts.But new research from the Center from Retirement Research turns conventional wisdom on its head.Despite the financial benefits of dual-income households during women's working years, the new CRR study reached a startling conclusion: Married women in their 50s are more at risk of facing an insecure retirement than any other group of women, including those who are divorced, single, widowed or in one-earner households.These head-scratching results have some logical explanations and demonstrate... Read full post

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