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LawTalk
LawTalk, Attorney
Category: Social Security
Satisfied Customers: 36350
Experience:  I have 30 years of legal and litigation experience, including representing clients before the U.S. Social Security Administration.
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I'll be in november. do i want to take early social security

Customer Question

i'll be 69 in november. do i want to take early social security retirement to avoid the hold harmless medicare part b premium increase? this is a complicated situation. lots of moving parts.
Submitted: 1 year ago.
Category: Social Security
Expert:  LawTalk replied 1 year ago.

Good afternoon,

I'm Doug, and I'm sorry to hear of the confusion. My goal is to provide you with excellent service today. In order to give you a clear and concise answer, I will need some additional information about the circumstances, please.

1. Are you not now getting Medicare parts A and B?

2. Are you employed and getting healthcare benefits from your employer?

Doug

Customer: replied 1 year ago.
i am getting medicare since my husband is receiving social security and medicare part b. i am not working.
Expert:  LawTalk replied 1 year ago.

Good morning,

Thanks for the additional information.

You face a conundrum, because while your Part B premium is set to rise from $104.90 per month to $159.30 per month if you are not receiving your retirement benefit by 2016, if you do take your retirement early by one year, you will lose the final 8% increase in your benefit which would occur if you waited until age 70 to collect your retirement benefit.

As I don't know what your expected benefit was at 66, I can't determine which would save you most. If you are statistically average and would have earned $1800 per month at age 66, then the 8% loss for retiring at 69 would amount to $144.00 per month less income.

When you compare the $55.00 increase in Medicare Part B with the benefit of waiting the additional year and gaining nearly 3 times that much, it seems that the financial benefit would be maximized by you waiting the additional year.

In the long run, if you choose to wait until age 70 to claim your retirement benefit, while your Part B premium will go up, you will still see a gain of about $89 per month by waiting that additional year.

Over your estimated lifetime based on present actuarial tables showing you to live to about 80, the extra money you will see by waiting to age 70---despite the rise in Medicare Part B when you are not covered by the Hold Harmless----will be a bit more than $10,000.

Unless you are in poor health and don't expect to live to age 80 or longer, or you need the money from your retirement benefit now and can't wait another year, then you probably should suffer the increase in your Part B premium and opt for the greater income when you do collect starting at age 70.

You may reply back to me using the Reply link and I will be happy to continue to assist you until I am able to address your concerns, to your satisfaction.

Please remember to rate my service to you so that I can be compensated for helping you. Thank you in advance.

I wish you and yours the best in 2015,

Doug