Turning 65? Three Things You Must Do This Year
If you’re turning 65 soon, chances are good that you’ve reached the last stages of retirement planning. Some of you might have even retired already, but turning 65 is still a pretty major milestone. Either way, here’s what you need to know if that important birthday is coming up soon.
Research your Social Security options. Now is the time to meet with a financial planner or Social Security representative, to learn about your option with regard to claiming your benefits. You need to seek an accurate estimate of your benefit amount, so that you know what expect of your retirement budget. You should also research your options regarding the timing of your claim; if you wait a bit longer, your monthly benefit amount will grow. But waiting isn’t the right choice for everyone, so be sure to discuss this issue in greater detail with an expert.
Plan for income taxes in retirement. Yes, income taxes are still a reality for those who have retired. Make sure you understand the tax implications of various retirement planning decisions, so that you can choose the best path forward. Part of your Social Security benefits can be taxed, dependeing upon your situation, and retirement plan distributions can be taxed as well. You don’t want any tax-related surprises in retirement, since your income will likely be fixed.
Learn about your Medicare options. For most retirees, medical expenses comprise a significant part of their budgets. Choosing the right Medicare plan can help you to manage these expenses and prevent surprises. And you must enroll in Medicare when you turn 65, unless you have creditable coverage through an employer. If you don’t enroll on time, you could be charged a penalty through higher premiums when you do enroll.
There is no single Medicare plan that works best for everyone. Since this is a highly personal decision, work closely with a licensed insurance broker to learn about the different Medicare options available to you.