x
As of August 2022, the average Social Security check is $1,547[1]. That means you have roughly $1,500 to spend on your monthly costs, which seems a little harsh, right? Well, you’re not alone. Many retirees are forced to get by on Social Security as their only source of income. Although, that is not what your Social Security benefits were meant for.
With the cost of living increasing every year, it’s no wonder many retirees are concerned about how they will afford their monthly bills and necessities. It’s never too late to start saving money and make lifestyle changes to help you create a more sustainable future. If you’re looking for ways to get more bang for your buck, you should consider making these five money-saving moves in retirement.
Are you aware Original Medicare has deductibles and provides no cap on your costs? With no limit on your expenses, who knows how much you could pay for your Medicare services within a year. That’s precisely why Medigap plans, such as Plan G, were created. They are designed to help cover those expenses for you, resulting in predictable costs throughout the year.
Original Medicare only covers 80% of approved services; without a Medigap plan, you would pay the remaining 20%. Think of it this way, if you need chemotherapy, you will pay 20% of the approved cost. Additionally, if you are an inpatient in the hospital, you’ll spend $1,600 before Part A helps cover your stay. If you need skilled nursing facility care, you’ll pay almost $200 per day after 21 days.
These are the types of costs a Medigap plan can cover for you, so you aren’t left with the bill after Medicare pays. When you explore your Medigap plan options before enrolling, you can easily determine your annual costs because you’ll know exactly what expenses are covered.
Purchasing a Medigap plan can help you avoid the risk of medical debt if you experience unexpected costs.
If you really want to save money on a gap plan take a close look at Impact Health Share For Seniors
Individuals 65 and older with Medicare Parts A and B can be members of Impact Health Sharing. And, with Impact Health Sharing, you will find a lot of the same things you expect from typical healthcare coverage, and so much more!
Impact for Seniors simplifies the healthcare experience.
Simply pay your Primary Responsibility Amount (PRA) of $1000 and Impact members will share the portion of your Eligible Medical Bills that Medicare allows but does not pay completely, like Co-pays, Deductibles, Hospitalization, Skilled Nursing Facility Care, and Out-of-country Urgent Care. With sharing secondary to Medicare, this program is an incredible options for seniors.
Although Original Medicare paired with a Medigap plan can cover 100% of your medical services, you will still have drug costs. If you get a cancer diagnosis while enrolled in Medicare, many cancer drugs fall under Medicare Part D rather than Part B. Some cancer drugs can cost almost $20,000 per year.
Do you have enough savings to help pay for those drugs while you need them? This is something you’ll want to think about in retirement. Adding a cancer plan to your list of insurance policies can help save you money in the long run. If you get diagnosed after purchasing the policy, you would receive a lump sum to use for cancer-related services.
Paying a low monthly premium for a cancer plan can truly make a difference in your financial future.
Members of our private Medicare Q&A Facebook group frequently ask if they need a Part D plan when they aren’t actively taking medications. Although Part D is not mandatory, you’ll want to consider enrolling in a drug plan for a few reasons. Not only can you avoid the late enrollment penalty, but you can also protect yourself if you are prescribed an expensive medication during the year.
Many people mistakenly think they can apply for a Part D plan any time during the year (wouldn’t that be nice?). However, this is not reality. Instead, you must wait until an enrollment window is available to apply for a drug plan. This often means waiting several months before you can sign up for a plan.
If a doctor prescribes you medications during the year and you have to wait to apply for a drug plan, you’ll pay for your drugs entirely out-of-pocket. However, a simple way to avoid this situation is by selecting an inexpensive Part D plan even if you don’t take medications. Each year you’ll have the opportunity to change your plan to ensure you always have the most cost-effective plan.
Every person’s full retirement age (FRA) is different because it’s based on your birth year. For example, if you were born in 1956, your FRA is 66 and 4 months. But, if you were more in 1960 or later, your FRA is 67.
The earlier you begin receiving your Social Security benefits, the longer you’ll be able to collect benefits. However, the downside to collecting early means your benefits are reduced. If you prefer to get more money in your check, you can wait until after your FRA to apply for Social Security benefits. This often means waiting until age 70.
Although this move is not fitting for everyone, it can be a goal to strive for, especially if you are actively working well into retirement age.
Entering your retirement years in a house with spare rooms and space is not always necessary. Saving money in retirement can start with downsizing your home to a more realistic size for your needs. A smaller home may equal a smaller monthly payment.
Not only can you reduce your monthly payments by downsizing, but you may make money off the home you sell. With money added back into your pocket, it opens up the opportunity for you to sell the house to pay off any debt, add it to your savings, or use it toward other necessities.
Choosing the right Medicare plans when you’re first eligible, learning about the right time to apply for Social Security benefits, and downsizing your home are just a few things you should consider in retirement. Making these money-saving moves in retirement can set you up for a more comfortable future with less worry.
