How Much Do You think You Need to Retire/What Age Will You/Spouse Retire: General Retirement Issues (Part 2)

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2331

@thumper1 your H got Medicare B with a special enrollment period. Medicare would not allow us to have Medicare B be signed up with special enrollment overlapping his initial enrollment. So our choices are to pay for Medicare B June 2021 or do a ‘work around’ which is submitted after Oct 1 2021 - so that would leave us not being able to sign up for supplement and drug plan well after Oct 1. And it takes days (up to 7) for them to scan in dropped off documents and show up on their system, and then the time for them to process. So we are paying for 4 months of overlap ($594) for this situation to be put to bed this week and so we can sign up for our supplemental coverage and move on. One person from SSA local office did tell us we could have Medicare B start Sept 2021 – but I did not get her name, and the other two in the local office said no and the one Claims Representation (which is higher than Customer Service Representative) also checked with his supervisor.

This has been a frustrating and annoying headache.

Having to learn how long it takes the local office to scan in faxed and dropped off documents. At least we live very close to local office and the wait time on the phone to them has not been super long. The gal on the phone today says they get 200 documents a day. Well they required us to put in writing instead of our verbal consent. So maybe by the end of the week we will have Medicare B processed for DH.

2332

@laralei if you take SS before your full retirement age (for us born in 1956 full retirement age is 66 and 4 months for SS) you will receive 5/9 of 1% penalty per month - and that sets your SS payments at the lower level forever.

Medicare A and B, eligible at age 65.

There is already the retirement age for SS scale. If you were born in 1960 or later, full retirement age for SS is 67. 1943-1954 it was 66, and added 2 months starting 1966 on.

In our family, some have had reasonable health care cost for coverage with retiring before 65. We had one spouse retire before 65 and lagging spouse have health care coverage for both until 2nd (me) retired at 65. H’s brother is retiring when his slightly younger wife (SAHM, not working outside the
home) turns 65 and he can also collect his managerial bonus.

Sometimes one has to scramble with loss of employment. People over a certain age become vulnerable because the company can have lower paid younger employees, and it is tougher to get a new job (including professional job) over a certain age.

The paradigm changes with Covid has certainly shook up lots of households.

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2333

Well I thought I had it all worked out, but the SS concerns me.

Also, I think DH will be out of a job, federal, under the current mandates. Many of his co-workers are taking retirement earlier than they had intended, but they are also older.

He will be turning 60 in 2022, so can start taking from his TSP. To supplement, I think I would have to take SS at 62. I had hoped to build up the TSP over the next couple of years, but that won’t be the case going forward.

I know there are a lot of online calculators for a lot of this, but was wondering if it is advantageous to consult with a financial planner. My brother uses his BIL and recommends him. I know the guy, but I am never comfortable with paying people for a service if I know them personally.

He is a nice guy, but a businessman, so…

2334

There are free seminars for understanding social security and Medicare, and the people that put these seminars are looking for clients. You can get a free sit down with a financial planner through that. American Financial Education Alliance - they have a publication at the seminar. You are under no obligation. their web site www.myafea.org Our personal financial planner is very knowledgeable about SS and how that fits in financially.

I guess you will be eligible for health insurance through federal.

If you don’t have a log in through SSA, you need to establish this. Then you can see your Social Security ‘report’. We use to get report in the mail and had a way to request that. We both had SSA log ins and so have kept up with our SS with that. The individual 4 page report includes benefits estimations - for various ages of retirement, disability, family survivors, and Medicare, and an explanation on how benefits are estimated.

The financial penalty for taking SS before your full retirement age is 5/9 of 1% for each month early. So that doesn’t hurt my SS earnings as much as it hurts DH. I am taking it now (age 65) before my full retirement age (being born in 1956, it is 66 and 4 months). We are holding out as long as we can to getting to DH’s full retirement age (he turned 65 June 2021 and has not filed for SS yet). I don’t like the penalty. There is a cross over point which can be part of a decision with how long to wait to draw SS, but we have done better than 8% on investments (versus waiting until 70 for SS for the gain after full retirement age) - and we have guaranteed investments gaining at least 8% in our portfolio (with some annuities) - oh yes a highly rated insurance company can potentially go under (we feel that risk is negligible but it is a risk). We just need my SS for cash flow at this time. As soon as I have my last contribution and company match go into Fidelity 401k, I will cash out that account to boost our available cash (yes I know that is taxable but our income this year is low with DH having been retired and my work not being FT).

Our daughter’s in law was in law enforcement including most of his service in a federal capacity with several relocations. Mandatory retirement at 55. They needed more years for better finances in retirement with only his income and his retirement.

Sorry with duplicate info from earlier post. I kind of forgot about that earlier post content.

2335

I am putting in web site complaints every day with SSA.gov and Medicare.gov - so today DH was suppose to have an appointment at local SSA office to have the Medicare B DONE. No, they had someone bring him a form to sign. Told him it would be put in today. So we have no idea IF it will get inputted today, and when we will see it on Medicare web site.

We keep getting lied to and given mis-information every contact.

2336

SOSConcern - ugh sorry you are going thru that govt run-around!

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2337

My H absolutely understands now, what needs to be said, and how much we have to follow up every day. We called about 4 hours after form was in their hands. Medicare B entered in now by the guy that was suppose to see DH; supposedly will be seen on their overall Medicare after overnight processing, and days later when we can see with log in. Requested they call us tomorrow if it is on the overall Medicare site or not. Will see. Tomorrow we are putting in his supplement application. Want to have everything in place as it should be by Oct 1.

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2338

I’m so sorry you are having to go through this. As a reassurance to others about to enter the process, if you have no extenuating circumstances most people can do this online with no problem. My H was covered by my insurance , filed as he turned 65, got coverage. I dropped him from my insurance and saved a bundle. It’s easy if you fit the usual case.

Preparing to claim my SS, I read in the online application that they would contact you if they need original documentation (birth certificates, wedding licenses, whatever) and they would return the originals. Not knowing if they will need it , but unwilling to send off my original wedding license, I found out that WA will mail a certified copy for $6, which includes unlimited printouts (pdf) of the certificate with an identifying overlay and certification letter.

2339

I went to an insurance agent with a list of my 2 meds. Within an hour, my application to Medicare and United American were down.

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2340

Well I was supposed to have my ‘welcome’ letter for SS. After my phone appt on Aug 5, they have gotten through 2 of the 3 steps according to what I can see on SS web site. Was supposed to be done in 2 - 4 weeks. Well, the LOCAL OFFICE is to complete the final step. So now I have to push that along too!!! I will call in the morning after they open. Because they didn’t process (and I had forgotten that my Medicare B will come out of my SS check - Oct payment will arrive Nov 10th) I received a bill for Payment for 1st qtr of Medicare B which was due 9-25-2021. I paid through pay.gov. Will also need to see how that will be handled – not paying double…

This whole thing is driving me nutty. I was much more upset last weekend than I am now. Did make progress this week.

2341

Yes the ‘usual’ process a person with a 6th grade education could process. IDK what is holding up the local office on my SS. The phone appointment on Aug 5th did not indicate any issues. We have been living in the area with this local SSA office since 1983, we have been married for 42 years, and my earning documents are in order with SSA. Nothing should be holding up my SS. But for whatever reason they are ‘behind’ with it. We have been at the same address since 1992.

2342

So @bookworm you had probably already had an understanding of what plan you wanted with Medicare additional insurance after Medicare A and B. All well and good you went through an agent.

You were not dealing with initial enrollment with spouse A and spouse B having overlapping periods.

We had made our supplement insurance and supplement drug plans selections months ago. Studied the info based on our medications. Talked to pharmacist at our Walgreen’s (which is 24/7 and on all our plans and with low cost on our medications). Very comfortable with our supplement health insurance and what it is costing.

And had we known what the limitations were in our situation (overlapping initial enrollment periods), enrolling for Medicare B for spouse A with what was going to have the ‘choices’ we had - we would have had his initial application 3 months before he turned 65 to be for Medicare A and Medicare B (instead of just Medicare A). Instead now we have had to work closely with the local SSA office to get his Medicare B in place at the tail end of his initial enrollment period.

Since I am not able to move forward until probably today with DH’s supplement application (BCBS of AL) - the local SSA office had everything in Thursday afternoon for him to ‘have’ Medicare B but not sure until Friday if it was showing up system wide for SSA - and will show up days later for people like us to log in and look; I had gone ahead with my supplement. We were able to go ahead with his drug plan Medicare supplement. I had already enrolled in my drug plan supplement. We are using Blue Cross Blue Shield of Alabama as our supplement - and because my employer also had BCBS of AL, my employer had to process to BCBS that the end date of my insurance with them was Sept 30 so DH and I could both be on Medicare supplement on Oct 1. As you may know, Medicare supplement and drug plans have to have end of coverage from the private to then switch on to the Medicare plan. I had several calls to my local employer and corporate employee benefits – yes my retirement/termination date was there on the list submitted by my facility and yes I had insurance coverage until Sept 30 as I had already checked ahead in planning my retirement – and a corporate benefits person is calling me when they send the weekly download to BCBS of Alabama which shows our health insurance coverage ending Sept 30. The Corporate Benefits manager told me Tuesday morning when I was on the phone with him and he said he keyed my information in – he failed to tell me that it was not immediately on the BCBS system; I had told him I needed that in for my supplement application to be approved but he didn’t ‘bother’ to fully inform me about a delay with BCBS seeing that information on my insurance coverage ending Sept 30th. Once it is showing on BCBS, then I can get the BCBS letter showing this (my documentation needed due to CMA with all the blunders with SSA/Medicare) and my application for BCBS Medicare supplement can be approved. I already had a ‘relationship’ with the corporate payroll person who submits the 401k payments at the end of the month and she also knew that my paycheck of Sept 24 was my last (which covered BCBS through Sept 30th).

I know lots of people that don’t have all this trouble. My Medicare A and B went smoothly.

My ‘retirement’ so far has been securing Medicare B for DH, securing the Medicare supplements and drug plans, and now added is pushing through my Social Security final step which was suppose to be done 2 - 4 weeks after Aug 5th by my local SSA office.

We don’t like the ‘penalty’ of paying almost $600 for Medicare B for June, July, Aug, and Sept due to our overlapping initial enrollments. Worse was all the time and energy we have had to expend going through all the steps, misinformation, and delays.

2343

Many people absolutely have very straight forward road to retirement with their Medicare and their Social Security.

Those that have federal employment, most have their stuff worked out properly. However a mistake often can be very terrible for the retiree. My daughter’s in laws found out years after receiving his pension that his health insurance cost was not properly taken out of his pension – so they had double payments on this deduction for several years. They had savings that were squeezed and had to be very careful with their expenditures.

Our neighbor who has long federal government service with the same agency had to submit over 3 months his intention to retire at the end of the year – it takes the federal government that long to properly process his retirement.

2344

So the local SSA office is trying diligently now to get DH’s Medicare B fixed. They told us what the system said today after the inputs yesterday, so now they have to take it all out, and re-enter stuff today and Monday – several steps.

On my SS, because my SS and Medicare A and B started the same month, after Oct 1, they system will finish processing SS. Then when that goes through, and they start taking out the automatic payments from SS for Medicare, they will see there is an overpayment and will send a refund to me.

The person today said everyone in their office has had to deal with spousal overlapping initial enrollments – uh, no, that is why we have had the run around since calling and continually doing what they tell us since Mon Sept 13, and with all the on line and prior calls - with the call from their person in July telling us to apply in September.

The SSA office also does try to delay one from following up with them closely “oh just wait for the Medicare card to show up”. Uh, no, we have to enroll in supplement by Oct 1 to have the level of insurance coverage we have expected to be able to obtain. They want to get you off the phone ASAP.

On a more interesting note (generally) - I have been looking at a little Guide to Retirement Planning (it is outdated but some of the tables come from sources that are up to date). The thoughts are sensible, covering the bases. For example, when I have time I am going to look up in the Bureau of Labor Statistics the data (pie chart %) on “annual expenses of an ‘average’ retired couple”. A note says the lower your income bracket, the higher the proportion of money you must spend on necessities like food and shelter, and the less you will have left over for extras like travel. Well that makes sense - through life one who has higher income has more money left over for extras like travel – but some may just think the averages are going to apply to them. People with paid off housing and low property and state taxes may have more money for extras like travel.

IDK if IRS Bulletin 590 still is published – life expectancy tables – one life/expected return multiples, and two lives/joint and last survivor/expected return multiples. Can think about with spousal pensions.

Our financial planner already has our data in a spread sheet where we can see how long our money will last (to what age), and continuing to update as time goes on. Can look to interest rate selection per year compounding quarterly starting with a lump sum and amounts you can withdraw…

2345

Just from a common sense perspective, it is so odd that spouses having overlapping enrollment should have any reason to affect the other spouses sign up.

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2346

It does! It affects the first person getting Medicare B when credible coverage end. It doesn’t affect the 2nd person’s Medicare A and B going through.

And our SSA office specific person is now inputting every day on DH’s Medicare A/B - see what the system does, and then clear it out and start over; see what the system does. The first person does not have a ‘special enrollment’ opportunity for starting Medicare B and supplemental insurance on time desired like you do when the initial enrollments do not overlap. Overlap is when born in same year and not enough months apart to not overlap. Our group health insurance coverage was ending Oct 1 as I was turning 65 and enrolling in Medicare A and B starting Oct 1, but he could only apply for Medicare B for Oct 1 AFTER the fact, retroactive, and then we would not have had our supplement in place. So the only option we HAD was to have Medicare A and B on June 1 (we had already had his Medicare A in place), and pay for Medicare B for 4 months when we had credible coverage. The person we talked to today said several in their office have needed to deal with this Medicare situation - it is a problem. Not fair on us not having the options others that do not overlap have. We have to pay more. Had we known in March - we would have had his Medicare A and B in place for June, and just ‘sucked it up’. So we found out with lots of time and energy, and stress. After this mess is actually resolved on the system, we have to make sure his supplement application does go through and his drug plan doesn’t get canceled due to Medicare’s system not being in the right information output. This morning it was showing Medicare A and B for Nov 1, so the guy took that out and made a correction. They already know it will take another step after the system generates overnight and they see it Monday. Maybe Tuesday it will show correct on Medicare’s system. It takes days for us to see it after that with our log in.

2347

If the government rules are not common sense, it doesn’t matter. I am going to learn if indeed Medicare administration can correct these kind of rules and I am going to try to give input for a better solution so people like us do not have the NIGHTMARE experience we had.

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2348

Not necessarily. If you are starting Medicare in the month you turn 65, coverage is guaranteed. Prior coverage, or proof thereof, is not required. Dunno about AL, but California supplement plan applications allow you to skip the part about prior coverage due to the guaranteed enrollment.

btw: I am struggling to understand your particular issue. Why does overlapping periods matter?

Yes, everyone should submit their individual request for coverage 2-3 months prior to the month that one turns 65. (unless still working and covered by an employer plan.) Once approved, and documents checked, SS will send out a Medicare card pretty quickly and after that, one can sign up for Supplement plans using the Medicare number. (I can understand by BCBS is stymied – H does not have a Medicare number yet.)

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2349

And if one is still working or on a spouses plan after 65 and are not taking Medicare, they should be applying for Medicare 90 days before their anticipated date to want Medicare to kick in, right? And if over 65, plan to have documentation of coverage.

@SOSConcern i hope this all gets resolved this week.

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2350

Three months is not an outrageous amount of time for retirement exit processing, especially when pensions are involved. I get a piddly pension from a prominent employee benefits consulting company from my time there in the 1980s. Took three months earlier this year to get my payments set up, and there was no 401k/retiree medical to process.

With employers where I have institutional knowledge that needs to be transmitted to others, I’ve given 2-3 months notice as a matter of course, so three months to process retirement applications isn’t a shock. Many companies have their 401k plans administered by external consulting companies, and may also set up separately with Vanguard or several different stock funds. All of those administrators/brokers need clean paperwork to process.

My H will probably give a year’s notice before retirement, as he wears many hats and has much institutional history to download (which he keeps doing, but then those people leave for other opportunities!).

The federal government benchmark for processing retiring employees is 60 days, not three months. They have been running about 75 days in the past 18 months, for obvious reasons. That includes pension, 401k, retiree medical/Medicare coordination, any continuing life insurance, LTC and other coverages, sick leave accrual calculations for the pension plan, and vacation payouts. Because of the way many of the plans work, year-end retirements are most common and there are often backups in that timeframe.

Here’s info and specific data from OPM:

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