Do I have to start my Social Security if I start my Medicare?

Share

Sign Up For Our Newsletter To Receive Weekly Updates.

Medicare and Social Security are linked. Many beneficiaries do not find this out until they go to sign up for Medicare.

It is important to plan how you want to approach your Medicare and Social Security sign up dates – once you make a decision, you really can’t take it back!

Medicare: Annual Enrollment 2020

On October 15th, the Medicare Annual Enrollment Period (AEP), sometimes referred to as Medicare Open Enrollment, starts. This is the time to make sure you have the best Medicare coverage for the upcoming year.

Sign up for Medicare with the Social Security Administration

For both Medicare and Social Security, when you want to start your benefit, you are going to go to the Social Security Administration.

While the process of signing up for both of these happens at the same place, they do not, and for most people, should not, start at the same time.

When can Social Security start?

If you qualify for Social Security benefits, they can start anywhere from age 62 to age 70. If you qualify for widow’s benefits, they can start as early as age 60. You get to pick when you want your benefits to begin within this timeframe.

You will not receive your full Social Security benefit until you reach your Full Retirement Age (FRA). FRA is based on the year you were born, but for anyone born after 1943, FRA is no longer age 65.

Full Retirement Age for people getting ready to retire currently is anywhere from age 66 to age 67. You can find your full retirement age here. 

Let’s say you were born in 1956. Your FRA is at age 66 and 4 months. If you take your benefit before you are 66 and 4 months, your benefit will be reduced.

If you take your benefit anytime after age 66 and 4 months, you will receive a larger benefit since you delayed.

Keep in mind, if you are married, when one spouse dies, the smaller Social Security check goes away. If you take your check early and reduce your benefit, you may also reduce the benefit the living spouse receives for the rest of their life.

When can Medicare start?

A common mistake we see people make is starting Social Security at age 65 because they think they will receive their full benefit. This misconception occurs since Medicare starts for many at age 65.

Most people are going to become eligible for Medicare on the first of the month of their 65th birthday.

It is important to note, if you have started your Social Security benefit early, before age 65, you will automatically get signed up for Medicare. You will have to contact Social Security if you do not want this to happen.

Do I have to start Social Security and Medicare at the same time? 

No, you do not have to start Social Security and Medicare at the same time, and for most people, they should not start them at the same time.

Original Medicare consists of 2 parts: Part A and Part B. You can have different start dates for Medicare Part A, Medicare Part B, and your Social Security check.

Sign up for Part A 

Part A of Medicare covers your hospital and skilled nursing. Part A comes at no cost to most people who are eligible for Medicare.

For this reason, we advise almost everyone to sign up for Part A right when they turn 65. Even if you have other health insurance, Part A is free and will provide you a little extra coverage when you might need it.

 Sign up for Part B

Part B covers your doctor and outpatient services. It cost $144.60/month in 2020 for most people.

This $144.60 is going to come directly out of your Social Security check if you are already taking your benefit. If you are not taking Social Security, you will be billed for it. You can also request to be billed for it if you’d prefer that over it being automatically deducted from your Social Security.

If you have a high income, you might be subject to IRMAA (Income Related Monthly Adjustment Amount) charges, which is a surcharge on Part B. Cardinal can help you with possibly lowering this charge.

If you are not working at age 65, then you are going to want to sign up for Part B right away. If you still have work coverage at age 65, you are going to want to delay until you retire and lose this coverage.

There are significant lifetime penalties, as well as the possibility for delayed enrollment, if you make a mistake when signing up for Part B. Make sure to consult a professional and research your decision before age 65.

Sign up for Social Security 

As we mentioned above, signing up for Social Security is going to happen whenever you elect to take your benefits, whether that is before, during, or after your full retirement age. For most people, their start dates for Part A, Part B, and Social Security are all going to differ.

We see this happen everyday in our practice. We have clients elect 3 different dates because that is what works best for their situation.

For example, we had a client Beth. She was still working when she turned 65, but we advised her to still sign up for Part A since it was going to be free for her.

When she retired at age 66, she started her Part B coverage since she lost her work coverage.

At age 70, she turned on her Social Security check. She wanted to delay her benefit because she did not need the money right away, and this let it grow to a much larger monthly check.

While Social Security and Medicare are linked, you still have the power to decide when to turn each one of these on. It is important to make educated decisions though, because you really don’t have the opportunity to go back and change your mind.

Make Social Security and Medicare decisions based on what is right for you, your situation, and your family. Cardinal can help you figure this out.

Get In Touch

Contact us today with any questions, concerns, or just to stay connected.

Contact Us

Have questions? Contact us today.

[contact-form-7 id="d91790a" title="Contact Us"]

Do I have to start my Social Security if I start my Medicare?

Share

Sign Up For Our Newsletter To Receive Weekly Updates.

Understanding the Upcoming 2026 Income Tax Increase: What You Need to Know

A Brief History of the Tax Cuts and Jobs Act (TCJA)

In today’s Cardinal lesson, we’re discussing the significant changes coming to income tax rates in 2026. This isn’t a proposal but a law already set in motion. The Tax Cuts and Jobs Act (TCJA), passed in 2017 and effective from January 1, 2018, brought about substantial reductions in income taxes. However, these reductions were only funded for eight years, meaning they will expire at the end of 2025.

What Changes to Expect in 2026

As of January 1, 2026, the tax rates will revert to their 2017 levels, adjusted for inflation. Key changes include:

  • The 12% bracket will increase to 15%.
  • The 22% bracket will rise to 25%.
  • The top rate of 37% will revert to 39.6%.

Not Just a Proposal

It’s crucial to understand that this change is already the law. Many people mistakenly believe that the tax rate increases are still under discussion. However, unless Congress enacts new legislation, these higher rates will take effect as scheduled.

Implications for Your Financial Planning

Impact on IRAs and 401(k)s

With the current lower tax rates, now is the time to consider strategies like Roth conversions. By converting funds from a traditional IRA to a Roth IRA now, you can potentially save a significant amount in taxes over the long term.

Why Planning Ahead is Crucial

For individuals with substantial retirement savings, understanding these changes is vital for effective tax planning. The window to take advantage of the current lower tax rates is closing, and planning ahead can make a significant difference.

Case Studies and Planning Opportunities

Hans Scheil and Tom Griffith discuss specific case studies and planning strategies in our latest video. These examples illustrate how different scenarios can be managed effectively:

  • Case Study 1: A married couple with an adjusted gross income of $150,000 in 2024 can convert part of their IRA to a Roth IRA, taking advantage of the lower current tax rates.
  • Case Study 2: High-net-worth individuals with large IRAs can save substantial amounts in taxes by planning conversions over the next two years.

Estate Tax Considerations

The TCJA also doubled the estate tax exemption, which will revert in 2026. This change can significantly impact high-net-worth individuals, making estate planning more crucial than ever.

Action Steps to Take Now

  • Review Your Current Tax Situation: Analyze how the upcoming changes will affect your finances.
  • Consider Roth Conversions: Take advantage of the lower tax rates before they expire.
  • Plan for Estate Taxes: Assess your estate plans in light of the changing exemptions.

Conclusion

The changes coming in 2026 are significant, but with proper planning and informed decision-making, you can navigate these changes effectively. Watch our video for more detailed insights and personalized advice.

Get In Touch

Contact us today with any questions, concerns, or just to stay connected.

Contact Us

Have questions? Contact us today.

[contact-form-7 id="d91790a" title="Contact Us"]
Scroll to Top

Ansylla Ramsey

OFFICE ADMINISTRATOR

Caleb Bartles

Life, Accident & Health insurance

Daphne Sutton

ADVISOR

Tommy Fallon

ADVISOR

Weekly Email

Want to get important updates first?

Don’t miss out on any important info, from Medicare deadlines to taxes, we will keep you updated! Try it out, you can always unsubscribe at any time.

Newsletter