@BunsenBurner - YES! One of my biggest concerns has been it will be gone before dh and I get our cards!!! I don’t want it to be in trouble!!
@garland , I’m sorry about your dh’s health. That’s a huge added stress.
When my H “retired” early, he was allowed to keep the same BC/BS insurance coverage but with us paying the full amount. That’s over $2200/mo. We’d hoped to consolidate all of the surgery we both need into one year before we have to go to Medicare. That plan has been pushed to next year, with little optimism it will work.
Thanks, @silpat. What he has is mild right now, but potentially an issue, and limits the kinds of medications he can take. So he’s basically fine now, but I can’t put the burden on him continuing to work in the future.
I think we could continue our healthcare insurance like you said, but unfortunately if we both retire, I don’t think we could pay that price until we both hit Medicare.
Still holding out hope for M4A, but probably wont’ be in time for us!
Gotcha. Sorry @Hoggirl !
Some information and projections on Medicare’s finances:
https://www.kff.org/medicare/issue-brief/the-facts-on-medicare-spending-and-financing/
Don’t need to be looking for street talk. The Medicare Trustees make clear that the Hospital Trust fund will be short by ~2026 (without legislative changes). The Supplementary trust (Parts B & D) is fully funded and is expected to remain so.
https://www.cms.gov/files/document/2020-medicare-trustees-report.pdf
Didn’t they also say SS will run out in x years but people still collecting it passed x years now ? Or am I wrong ?
They tweaked SS to last a little longer. They will have to tweak it again. Likewise, they will tweak Medicare to last a little longer.
They have been tweaking Medicare to try to trim costs (competitive bidding is one such tweak and has badly affected many beneficiaries and companies providing services). It will doubtless need to continue to be adjusted.
A little morbid to say; it will have to continue that way until aging boomers pass and relieve the burden on the system.
But wait - I think I’m a very late boomer!
I am, too!
In my mind I’m about 35…
Whether Medicare has a funding problem or not is a political not a financial matter. I’m sure the whole system could be made more efficient – Medicare Modernization Act of 2003 prohibits Medicare from negotiating pharmaceutical prices and as a consequence, we pay more in the US for drugs than any other major country. That too is a political decision.
My guess is that when a Democrat becomes President, he/she will try to infuse new funds into Medicare and the Republicans will somehow decide that deficits matter again. Not sure what the outcome will be. It probably won’t be investment in a new system coupled by major improvements to the system but it probably won’t be bankruptcy of the system either.
Not sure of your exact question, but The SS Trust Fund will run out of money in ~2035, at which time current law will require the SS Administration to reduce all payments by ~24%, i.e., you will only receive 76% of the previous year’s money. (again, current law, assuming Congress makes no changes before then)
I still have a few years to go so I am not too familiar with the inner calculations and history of SS and Medicare and admittedly as you point out there are definitely political matters that have helped create the mess but it seems it is a financial issue too? Is it not somewhat like many of the pensions that are failing due to combinations of lofty projections of returns on investments and assuming participants would live fewer years than is happening?
Social Security and Medicare are not real pension systems in that sense, since they are mainly pay-as-you-go (i.e. current workers are taxed on their labor income to pay for the benefits of current >=65 year old people). If the tax revenue is insufficient to pay for benefits, then the political choice is between raising taxes and cutting benefits, although they can be done in a less obvious way (e.g. indexing Social Security to a slower growing measure of “inflation” or being stricter on what services Medicare will pay for, etc.).
The issue with Social Security is that people are living longer, and the boomer generation that is retiring is large, so there will be more recipients per worker. Since the economy is also becoming less favorable to labor (versus capital), the tax base (labor income) for Social Security is also not growing as much. Medicare is also burdened by the general cost of medical care increasing quickly (due to lots of reasons).
@yearstogo, @ucbalumnus is correct. While we have pretended for a while that SS is like a pension fund, the government is not actually saving up money for future obligations. I think the assets of the “Trust” fund are IOUs from the government, which means that the system is pay-as-you-go (and has been so at least since I was knowledgeable enough to think about it). Medicare is inherently pay-as-you-go.
Baby boomers have hit or will soon hit 65. According to the Census Bureau, “By 2030, all baby boomers will be older than age 65. This will expand the size of the older population so that 1 in every 5 residents will be retirement age.” I think 18% of the population was above 65 or above in 2018. This is and will be a huge block of the population, and seniors tend to have fewer responsibilities (childcare, jobs) that make voting hard and hence vote at a higher rate than others. So, swinging an axe at Medicare or SS directly is probably not a recipe for political success. Disguised moves like those described by @ucbalumnus are more likely.
If we wished to, we could make Medicare more efficient, though an overhaul of the entire health care system could do a lot more and is quite unlikely.
@ucbalumnus is also correct about the problem in SS (aging population, tax and other laws favoring capital over labor). However, one reason the US was thought not to have the same retirement system problems as Europe or Japan was because we had a growing immigrant population. Hence, more people working and paying payroll tax. Our current anti-immigration policies and tone (e.g., doctors and nurses of Asian ancestry being verbally attacked while treating patients for COVID-19; see https://www.washingtonpost.com/business/2020/05/19/asian-american-discrimination/) will certainly not help pay for baby boomers’ retirements.
When we do talk about retirement, travel figured prominently in our plans. Both of us love to travel and we wanted to do more of that. Also have family abroad and would be making frequent trips out there. Now, all of that seems to be up in the air.
I could adjust to this low key working from home lifestyle and continue this way for a while longer.
Real estate - D is moving to a new state/town for her residency and we’ve been looking at a starter home/condo for her to buy. Demand is crazy - these places are under contract within 24-48 hours! And it doesn’t look prices are coming down either - it definitely still seems to be a seller’s market.
Do folks believe this will be changing soon?
We have traveled a lot. I travel a lot for work and then as a couple we have had lots of pleasure travel and some travel that is mixed. So that probably is a significant part of our budget. Not sure when work or work/play or play travel will resume. In the meantime, we are spending that money on furniture and other things for our new house.
Real Estate. Our house is on the market. RE agent suggested a higher opening offer than I would have guessed. No movement in 10 days on the few houses in the market in that price range. But, they expect demand to pick up as we exit stay in place and don’t want us to reduce price but did suggest we paint some rooms white that ShawWife had preferred in her original color.
Just got a fraudulently filed application for unemployment insurance in my name. Reported it to the state government. What a vile world in which criminals apply for unemployment insurance in people’s names, weakening the state’s ability to take care of people who really need help.