I don’t know about you, but I don’t plan to retire at 65. I mean, that’s only 25 years away. And I like my job. Maybe that’s you.
Even still, don’t put off signing up for Medicare when you turn 65. Here’s Why.
Mistake #1: Waiting until after you retire to sign up for Part A.
Why it’s a mistake: Medicare is basically free money. You paid for it with your taxes for the past forty-some years…but still.
Ultimately here’s the deal–you CAN wait. But since it’s no skin off your back, wouldn’t you rather set it and forget it? Think about that time you set up automatic payments into your savings account or 401k. You may not have missed the money, but when you got your tax forms, you saw the benefit of making a small change. It’s the same here. Signing up for Part A is easy, and makes the process of signing up for Part B or a Medicare Advantage plan much easier.
Mistake #2: Staying on private health insurance coverage instead of signing up for Part B, without doing further research.
Why it’s a mistake: The plan you are currently on may not provide enough coverage.
If you plan to stay on your current coverage instead of signing up for Part B as soon as you turn 65, you want to make sure that your health plan provides appropriate coverage. We’re talking about a qualified group health plan (as defined by the IRS). If you’ve ever had to provide proof of “creditable coverage” for plan enrollment, this is similar. Otherwise, you will pay a penalty when you sign up for Part B coverage. This penalty is paid with each premium payment and never goes away. The longer you are eligible for Part B without signing up, the more the penalty costs. Do your future self a favor and get HR to confirm (in writing) that your current coverage meets the requirements.
Mistake #3: Assuming that your current insurance plan will continue to be available after you become eligible for Medicare
Why it’s a mistake: Believe it or not, some insurance plans and employers will not cover you (or your spouse) if there is other coverage available elsewhere. That includes Medicare. Medicare enrollment begins three months before you turn 65 and lasts three months after. Start looking at your options early to make sure you don’t get left without insurance unexpectedly.
Whatever you decide about retirement, make sure that you have the information you need to make good, informed decisions.
Next week we’ll be getting into the nitty-gritty of how to actually sign up for Medicare. Make sure to follow us on Facebook or Instagram to see when the blog gets posted!
