Do you think you should not enroll in Medicare before Social Security? Think again | Smart Change: Personal Finance

(Morri Bachmann)

The decision to enroll in Social Security is a big one. That’s because your filing age will determine how much monthly benefit you are entitled to throughout your retirement.

You can register for Social Security as soon as possible age 62. But you can’t claim your full monthly benefit based on your salary history until your full retirement age, or FRA. The FRA depends on your year of birth, which is either 66, 67, or 66 and a certain number of months.

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Meanwhile, Medicare eligibility begins at age 65. In fact, you can sign up for Medicare up to three months before your 65th birthday. If you have reached this point and you haven’t collected yet social SecurityIn this case, you may be wondering if it is beneficial to delay your enrollment in Medicare.

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In some cases, it can. But in many cases, that doesn’t happen.

two separate programs

You may assume that you cannot enroll in Medicare until you sign up for Social Security benefits. But in fact, this is not true at all. Just as you can apply for Social Security before Medicare, you can also do the opposite – enroll in Medicare at age 65 even if you want to wait until the FRA or later to claim Social Security.

In fact, delaying Medicare just because you’re not a Social Security subscriber could end up being a problem for a number of reasons. First, it may mean giving up the health coverage you need. Second, it could mean facing hefty penalties for Medicare Part B, which covers outpatient services.

For each full year period in which you qualify for Part B but do not enroll, you face an additional 10% fee for life on your premium costs. Now there is an exception to this rule, which is if you are covered by a group health insurance plan. If so, this penalty is waived, and you get a special Medicare enrollment period once you separate from your employer or your group coverage ends.

But otherwise, consider that penalty when deciding to delay Medicare. And don’t let Social Security — or the fact that you haven’t collected benefits yet — dictate that decision.

When you are Do Pay for Medicare Delay

For many older adults, enrolling in Medicare at age 65 makes sense. But if you’re still working, you have group health coverage that you’re happy with, and contribute to health savings account (HSA), you can pay to delay Medicare.

Once you enroll in Medicare, you are no longer eligible for HSA funding. Now this does not mean that you cannot use your HSA to cover the health care costs you incur as a Medicare beneficiary. But you cannot put new money into your account.

Regardless, it is often a good idea to enroll in at least Medicare Part A at age 65, even if you have a group health plan through your employer. Part A, which covers hospital care, is generally free for seniors. And it can act as secondary insurance, taking on some costs that your primary insurance plan doesn’t.

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