401(k) Plans... Social Security... Delayed Retirement Credits... Medicare

Only about half of all American workers have access to a 401(k) plan. I'm fortunate enough to be one of those that is building his 401(k) each month toward my retirement years -- which are approximately 12 to 15 years away. The average retired Social Security recipient in the United States receives $1,461 per month, which is not very much. For 2020, the Social Security cost of living adjustment is expected to be around 1.8 percent. For those who have not financially planned toward their retirement years, the road can look pretty challenging.

I qualify to take my full retirement at age 67, which is 12 years from now (April 2032). However, if I delay on taking my Social Security benefits until age 70, then I will receive approximately 8 percent more for each year delayed... for a total of 24% more money at age 70. Many people don't realize that. You don't have to take your Social Security when you reach the full retirement age of 67, but there is no additional delayed retirement credits by waiting past age 70 to take Social Security. Generally, you should apply for your Social Security retirement benefits four months before you want your benefits to begin.

Regardless of your 401(k) or Social Security benefit, you should sign up for Medicare at age 65. Medicare is the United States' health insurance program for people age 65 or older. The program helps with the cost of health care, but it does not cover all medical expenses or the cost of most long-term care. Medicare has two parts -- A and B:

Hospital insurance (Part A) helps pay for inpatient care in a hospital or skilled nursing facility (following a hospital stay), some home health care, and hospice care. Most people age 65 or older are eligible for free Medicare hospital insurance (Part A) if they have worked and paid Medicare taxes long enough. You should sign up for Medicare hospital insurance (Part A) 3 months before your 65th birthday, whether or not you want to begin receiving Social Security retirement benefits.

Medical insurance (Part B) helps cover medically necessary doctors’ services, outpatient care, home health services, and other medical services. Part B also covers many preventive services. Anyone who is eligible for free Medicare hospital insurance (Part A) can enroll in Medicare medical insurance (Part B) by paying a monthly premium. Currently, the standard Part B premium is $135.50 per month.

To apply for Social Security benefits, most people simply have to provide their social security number; birth certificate; most recent W-2 forms; and, the name of your bank and your account number so your benefits can be directly deposited into your account. Documents need to be either original or certified copies by the issuing office.

By the way, the income you receive from your 401(k) or other qualified retirement plan does not affect the amount of Social Security retirement benefits you receive each month.

I first started earning money nearly 40 years ago -- in 1981 at the age of 16. You're never too young to start planning toward your retirement years and I would encourage anyone currently earning an income to try and set aside money each month toward the day when you'll permanently exit the workforce.

From Him, Through Him, For Him (Romans 11:36),

Paul J. Staso

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Visit my YouTube channel -- https://www.youtube.com/user/pacetrek

Click on any of the links below to see some of my adventure photos:

• United States in 2006 (3,260 miles solo in 108 days at age 41)
• Montana in 2008 (620 miles solo in 20 days at age 43)
• Alaska in 2009 (500 miles solo in 18 days at age 44)
• Germany in 2010 (500 miles solo in 21 days at age 45)
• The Mojave Desert in 2011 (506 miles solo in 17 days at age 46)
• Various Photos From Mileposts Gone By
• Students Worldwide Who Ran With Me Virtually
• Roadside Sights From My Running Adventures
• Some Cycling Moments From The Past

There Are 50 Million Retirees in America. I'll Join Them Around 2035.

A Gallup poll shows that 41 percent of Americans plan to retire at age 66 or older. Age 62 is the minimum age to collect Social Security in the United States and currently there are about 50 million retired men and women in America.

For many who end up retiring early, it can be due to unforeseen circumstances. Nearly half of retirees say they left the workforce earlier than planned -- often to cope with a health problem, or disability, or to care for a spouse or other family member. Other retirees are forced out of their jobs due to changes at their company -- such as a downsizing or closure, new skills required for the job, or other work-related reasons. If you're age 65 or older you will probably qualify for health insurance through Medicare, but younger retirees need to find a new health insurance plan or pay for often expensive COBRA coverage.

Those age 62 and older have the option to start collecting Social Security payments, but your monthly payment is reduced if you claim benefits before your full retirement age, which is typically 66 or 67 (67 for me since I was born after 1960).

I'm 54 years of age and was recently reminded by a sign at a local movie theater that next year, at age 55, I'll qualify for a "Senior" discount. It's difficult for me to comprehend that I'm only one year away from getting senior discounts. Regardless, the calendar doesn't lie. I'm aiming to work full time until age 70, three years past the time when I will qualify for my full Social Security benefits. Why? Because if I delay three years I'll receive 24 percent more in my Social Security amount.

As many of you know, I am still the President of The P.A.C.E. Fitness Foundation, Inc. (EIN 27-0413712) -- which I founded in 2009 to promote youth health and fitness on a global level. That non-profit organization is in good standing with the Internal Revenue Service and is something I may do more with during my retirement years. For now, I'll continue to work in the field of law until I join the 50 million retirees in the United States.

A primary goal before retirement is to pay off my mortgage. For some, that's becoming more challenging to do before retiring. Currently, 44 percent of Americans between the ages of 60 and 70 have a mortgage when they retire, and as many as 17 percent of those say they may never pay it off. About 32 percent of retired Americans predict they will be paying their mortgage for at least eight more years. I don't want to be in that group, so I'm aiming to have my mortgage paid off by age 67.

Planning to go into retirement with a paid off mortgage, a solid 401K, and as much money in the bank as possible is always a wise approach. In just 7 years Kelley and I will be empty nesters and at that point I'll be 9 years away from retiring. I'm going to make the most of these remaining years of full-time work with 'birds' in the nest!

From Him, Through Him, For Him (Romans 11:36),

Paul J. Staso

_______________________________________

Visit my YouTube channel -- https://www.youtube.com/user/pacetrek

Click on any of the links below to see some of my adventure photos:

• United States in 2006 (3,260 miles solo in 108 days at age 41)
• Montana in 2008 (620 miles solo in 20 days at age 43)
• Alaska in 2009 (500 miles solo in 18 days at age 44)
• Germany in 2010 (500 miles solo in 21 days at age 45)
• The Mojave Desert in 2011 (506 miles solo in 17 days at age 46)
• Various Photos From Mileposts Gone By
• Students Worldwide Who Ran With Me Virtually
• Roadside Sights From My Running Adventures
• Some Cycling Moments From The Past