Have you ever learned something the hard way and then found yourself thinking, “Gee, I wish someone had told me that!” As the years pass, we all learn, or should learn, a few new things.

Sometimes the new information comes by way of experience, good or bad. Other times it’s learned by observing others and/or paying attention to what they have experienced. The really important thing is to pass on what we learn to others our age, and especially to the next generation.

Billy Graham wrote a book a few years before his death. As part of the introduction Graham made the following statement. “I have prepared my entire life to die, but nothing ever prepared me for old age.”

Someone should write a short book containing practical tips for people approaching retirement years. Since that book has not been written, this article is going to cover a few practical tips I have learned since turning 65.

If you are 55 years old, or older, pay close attention. If you are significantly younger, then make a copy of this article and save it to reread when you reach that age. These are some of those “I wish someone had told me” things that are really important in your later years, but seldom does anyone mention them.

This article will cover tips on Social Security and Medicare. The second article [April web exclusive] will cover some financial tips on “must-have” legal documents everyone should have in place.


Spouse social security benefits

Admittedly, my wife and I are part of a dying generation. We were raised in an environment where most men worked to provide for the family, and most women stayed home and raised the children. This is not meant to condemn working women; it’s meant to enlighten non-working women or women who have earned significantly less than their husbands about social security benefits they may not be aware of.

Men and women can begin receiving social security benefits at the age of 62, at least if you were part of the baby boomer generation. Yes, the monthly benefits are reduced if taken early.

What I did not know was that when I began receiving social security benefits, in my case at age 65, my wife automatically began receiving 50% of what my monthly benefits were! Now, if my wife had earned significant income over the years, her personal benefits may be greater than 50% of mine and therefore that is what she would receive. However, in my wife’s case, her monthly check at 62 was relatively small compared to mine because she had only been in the workforce for a limited number of years.

Tip: If your spouse has not worked a lot over the years, consider having her draw Social Security at age 62. Don’t wait for the benefits to increase. She will get a raise as soon as you begin receiving benefits. Do the math and check with your local Social Security office to confirm benefits for your specific situation.


Medicare supplemental insurance

Medicare Parts A and B (B is optional) covers most of a person’s doctor and hospital costs. In order to cover possible uncovered expenses, individuals will need to (but are not required to) purchase Medicare Supplemental Insurance.

It’s quite confusing. There are multiple options, each of which covers a bit more. My suggestion is to sign up for the maximum coverage. In my case, I have had several heart issues since turning 65. The first hospitalization alone was more than $100,000. Over the past few years I have been hospitalized several times. The good news is that having purchased the maximum Medicare Supplemental Insurance, my doctor and hospitalizations have not cost me even one penny!

Tip: The cost of maximum Supplemental Medicare Insurance is not all that different than selecting minimum coverage. Even a small percentage of a $100,000 hospital bill is a lot of money. Medical bills in one’s later years can literally bankrupt an individual without proper coverage. Give serious consideration to purchasing the maximum Supplemental Medicare Insurance available.


Cost of coverage

Medicare supplemental insurance coverage is the same from all insurance companies, but the cost is not.

When you near the age of 65 your mail box will be stuffed with information on Medicare Supplemental Benefit Insurance. The truth is that coverage offered by any, and all, insurance companies is exactly the same — by law. What is not the same is the cost.

My wife and I initially signed up with our current insurance company since we knew the people and assumed the cost of coverage was the same no matter who we purchased it from. Wrong! Years later we found out the coverage options, in terms of what is covered, is identical but the price dramatically differs based on who you buy it from. We literally stumbled across this as we were talking with friends. After a couple of calls, we changed providers at roughly 50% of what we were paying — for the same coverage!

Tip: When it comes to purchasing Medicare Supplemental Insurance, shop around.


Rx drug coverage

Prior to age 65, my wife and I had excellent health with neither of us having ever been in the hospital. We had also been using a holistic doctor for years, so we were taking several supplements, but no drugs.

When you reach 65, you are required by law to file for Medicare but not required to purchase a Medicare Supplemental Insurance or a supplement drug plan. The cost of the drug plan was low, about $15 to $20/month. However, neither of us purchased a prescription drug plan since we saw no need for it. Our thinking was that we would simply sign up when the need arose. Major mistake!

What we found out five years later was that there is a 10% surcharge when purchasing the drug plan for each year one is not signed up. That meant we each had to pay a 50% surcharge for the plan when we did sign up. Guess what, the 50% increase remains in affect the rest of your life. No kidding, that is the truth. Is it fair? Absolutely not, but it is fact. I really wish someone had told me that at age 65.

Tip: Sign up for a supplemental drug plan at the same time you purchase your Supplemental Medicare Insurance. You will be offered the option of paying for the supplement drug plan monthly or paying for the entire plan for the year. Consider paying all 12 months up front to avoid the hassle of monthly billing and possible problems of accidentally missing a payment.


That covers a few basic tips on Medicare and drug plans when one reaches the age of 65. Next month we will cover several legal documents you will definitely want to have in place to facilitate the handling of your finances in your later years and/or when you pass. RJ 2.0