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Retirement Savings: Understanding State Retirement Plans

Hardworking citizens deserve to retire in comfort, but that isn’t always a guarantee in the real world. All around the United States, state-sponsored retirement plans are an option for employees working for companies of a certain size that don’t offer their own retirement plans. Many people see it as a good opportunity to build a retirement, but there is more to consider with these plans and their limitations. In this article, we will explore what these retirement plans offer—and whether or not they are worth the investment.

What Are State-Sponsored Retirement Plans?

A state-sponsored retirement plan is a retirement option that companies have to offer their employees once the company reaches a certain size if they don’t have their own employer-sponsored plans available. These individual plans can operate in different ways, offering an investment option with a firm that is chosen by the state. State plans can offer a traditional IRA, Roth IRA, or pre-tax for employee investment. 

These retirement plans are an opportunity for employees to put aside money for retirement. They require employers to put aside a set percentage, with the standard being 3% of an individual’s salary, for their employees. Employees can contribute between $5,500 and $1,000 annually depending on their circumstances. This money builds over time and can be accessed for tax-free withdrawal once the employee hits the designated age. For most plans, the age is 59 ½. 

Looking Out for Your Needs

People often consider a retirement plan to be something that will build itself in the background over time, but this isn’t always true. Relying on state programs or programs like Social Security can actually offer an unpleasant experience down the line. Recently, reports revealed that $1,657 was the average monthly payout for Social Security in 2022—an amount that will cover very little compared to the cost of living in most states. 

Preparing for the future takes active steps, and it must be done with a keen focus on understanding. Prioritizing your own private retirement investments is a wonderful way to set yourself up for the future without forcing you to rely on the potentially unreliable services offered by others. As much as we want to believe that the states will work these things out, there really isn’t a guarantee at this point.

To take active steps to secure your financial future, it is beneficial to start retirement planning as early as possible. Contribute as much as you can to an individual retirement if you have the option to, and be realistic about how you can alter your budget to support your future. When in doubt, working with a financial planner can help you to build a more reliable retirement. 

The Takeaway

Your financial future is in your hands, even if others say that they can help. State-run programs can be a great benefit when you retire, but they simply cannot be your only option in this day and age. Taking steps to prioritize saving money in advance is an excellent step forward. Don’t hesitate to learn more about retirement so you can take better control of your financial future and retire in comfort.

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Medicare Fitness Plans

Original Medicare does not provide any benefits for fitness. Many, but not all, Medicare Advantage Plans and a few Medigap plans include some fitness benefits such as free or reduced-price classes, gym memberships, supplements, etc. If this kind of benefit is important to you, examine the plan brochure carefully.

The more interesting question is, should they be important to you? There is a lot of research that demonstrates that even mild to moderate aerobic and strength training exercise is enormously beneficial to seniors and the disabled. Even a little exercise will help and the more the better. 

 Exercise improves and maintains functioning, fights depression, reduces pain, increases mobility – the benefits are unlimited! So, in general, having an Advantage or Medigap plan that offers fitness benefits is a good thing.

But is it a good thing for you? If you are a self-starter and self-organizer who can Google a fitness routine and start and keep to it without encouragement, you probably don’t need a fitness benefit. 

Buying a pair of two-pound dumbbells or a membership at a local gym, you can benefit greatly from any type of fitness regime.

Many Advantage and Medigap Plans offer the “Silver Sneakers” program of in-person and online exercise classes as a fitness benefit. The classes are worth taking, particularly if you enjoy group activities. Introverts may prefer the online version. 

If your plan offers fitness activities, there is usually no cost or obligation to try them, so give them a whirl! 

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Exercise and Fitness in Your Golden Years: The Best Exercises for Seniors

With each new year, we all get a little bit older, and the years can certainly change our bodies. As we slowly gain more knowledge and a better understanding of what the aging process really looks like, there is more of a focus on what we can do to support our bodies later in life. Let’s explore the best exercises to embrace during your Golden Years so that you can age with grace and comfort!

Walking

There are few exercises more simple or enjoyable than walking, and it is also an excellent opportunity to get plenty of exercise. When we walk, we get our blood pumping and help our muscles to shake out any lingering tension. This low-impact exercise makes it easy for us to increase overall health, particularly in the heart and lungs!

Swimming

You would be hard-pressed to find a doctor that doesn’t believe that swimming is one of the best exercises that seniors can do. As far as exercise methods go, swimming is as low-impact as you can get. It allows us to get plenty of healthy exercise without putting the amount of strain that can come with other forms of exercise. As an added bonus, it is also quite a bit of fun! Whether you are swimming laps or doing water aerobics, you will find that the pool is a great space to promote your wellness, particularly if you have chronic pain or arthritis. 

Yoga

With every passing year, more people are developing an interest in yoga, and it is fairly easy to see what is driving this interest. Overall, yoga is a form of exercise that really does cater to the needs of the individual. It can be as simple or as difficult as you make it, allowing you to grow along with it as you explore your practice. Like the other exercises on this list, yoga is low-impact, but it also does wonders for stretching out the muscles and increasing comfort in the joints. 

Strength Training

In recent years, a surprising number of seniors are turning to strength training in order to support their health and wellness. Strength training can help us to retain our muscular strength, support our bone density, and increase our mobility. Some people use it to maintain their independence as they age, but others use it to manage pain levels that are associated with chronic disease.

Aerobics

Aerobic exercise has been one of the most popular forms of exercise for seniors who are looking to age with an added bit of grace and style. This heart-friendly exercise option is a great way to remain active and improve your overall mobility. Though levels can vary, this is a good exercise option that should be discussed with a doctor depending on your unique needs.

The Takeaway

Your Golden Years can be some of the best years of your life, and it all gets a lot easier when you pair them with the right exercise. Choosing a good way to stay healthy and active can help you to enjoy the years even more by giving you the power to maintain your comfort and independence, even as the decades pass by!

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The Size of Medicare (Nationally) in the U.S.

The Size of Medicare (Nationally) in the U.S.

For the whole US, Medicare enrolls 64 million people. Of those, 9.1 million are on Medicare due to a disability, 16% of the Medicare population. Another 500,000 are on Medicare due to End-Stage Renal Disease (ESRD). Medicare accounts for 4% of the US Gross Domestic Product (GDP), or around $780 billion dollars, making it the second most expensive Federal program. (Social Security, at about one trillion ($1,000,000,000,000) per year.

The average total cost per Medicare beneficiary is $12,187 per year. Of that, beneficiaries pay an average of $170.10 per month, or $2041,20, for Part B in 2022 and pay an additional average of ca. $6,000 out of pocket, for a total of around $8100. A very good private insurance plan, in contrast, would cost around $26,000 per year.

Medicare accounted for 20 percent of total national health spending, 30 percent of spending on retail sales of prescription drugs, 25 percent of spending on hospital care, and 23 percent of spending on physician services in 2017.

 

 

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Saving on Prescription Drugs While on Medicare

Saving on Prescription Drugs While on Medicare

If you are on Medicare, you probably spend an average of $581 per year, out-of-pocket on your prescription drugs, over and above your Part B premiums and any Medicare Advantage, Medigap, or prescription drug plan premiums that you pay. For some, it can be much more.

87% of adults aged 65-79 use prescription drugs, and the average number prescribed per person is 20.

How can you save? Medicare Advantage and Medicare Part D plans are required to provide a mail-order pharmacy option. When you use mail order, you are avoiding a retail pharmacy, prices are generally somewhat lower than in-person pharmacy service, but not always: it depends on the plan and the drug in question.

If you compare the full retail pharmacy price, using a discount card like GoodRx versus the mail-order cost, you may occasionally find that using the discount card is cheaper.

Another option has recently become available…

Billionaire Mark Cuban has started a mail-order pharmacy called CostPlusDrugs.com. Around 100 generic medications are available from this site, all at cost plus a 15% markup. You may find that the price from this site, assuming your drug is available, is far less than the mail-order price with your Medicare Advantage or prescription drug plan. New drugs will be added each month. At present, the plan is to offer only generics, but this may change. You can check if a generic is available for your prescription drug by asking your doctor’s office or googling “generic for name-of-prescription drug.” Currently, CostPlusDrugs.com does not accept insurance to keep administrative costs down. This may change in the future.

If you are considering ordering from other mail-order pharmacies, Blink Health has been rated best, it accepts most insurances and is available 24/7. Blink has most drugs available in addition to generics.

More than ever now, it pays to shop around for your prescriptions, as it true with so much else.

 

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Dental Coverage Under Medicare

Dental Coverage Under Medicare
Dental Coverage Under Medicare

Dental Coverage Under Medicare

Medicare covers almost no dental services. Not exams. Not cleaning. Not dentures. Not drilling. Not filling. Zip. Zero. Nada. The exceedingly rare situations in which Medicare covers dental services are those in which dental services are an integral part of care for a non-dental problem, such as a jaw injury or bone cancer.

That being said, the only way that you will obtain dental services under Medicare is to enroll in a Medicare Advance Plan that offers dental services as an extra benefit or enroll in a dental plan for seniors on Medicare. With Medicare Advantage Plans, precisely because they are an extra benefit, they tend to be limited, but some coverage is certainly better than none. Coverage in separate dental plans may be more generous.

Because both Medicare Advantage Plans and dental plans for seniors on Medicare are both private businesses not affiliated with the federal government, you must deal with a Medicare agent in order to get them. The Social Security office or Medicare can only refer you to an agent if you have questions about these plans.

When Can I Enroll?

For Medicare Advantage Plans that offer dental services as an extra benefit, your Original Enrollment period starts the third month before your 65th birthday and runs for seven months. There is also an open enrollment period from January 1 to March 31 of each year. You also have a special enrollment period if you lose coverage because your plan shut down, or stopped offering services in your area, you lost employer-provided insurance that you were using as evidence of creditable coverage, you were given wrong information about enrollment by a Federal employee, and a few other situations.

Open enrollment for stand-alone dental plans for seniors is usually year-round, but this may vary in some states and localities. Again, your Medicare insurance agent is your best source here; Medicare cannot help you.

How Much Does It Cost?

As with American health care in general, prices vary widely and wildly. Premiums for Medicare Advantage Plans with dental services range from $0 per month to around $100 per month; premiums for stand-alone dental plans range from $0 to $100 per month. That being said, why, you may ask, does not everyone pick the zero-premium plans? The answer is coverage. You get what you pay for, and higher-cost plans generally, but not always, offer lower deductibles and copayments and a wider range of services.

About half of adults on Medicare do not have dental coverage. It is not advisable to be one of them.

 

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Does Medicare Cover Ambulance Services?

Does Medicare Cover Ambulance Services?
Does Medicare Cover Ambulance Services?

Does Medicare Cover Ambulance Services?

The short answer is yes. If ground or air ambulance transport is medically necessary, Medicare will pay to transport you to the nearest facility that can provide the needed services. Services are provided under Part B. If you do not have Part B, Medicare will not pay.

The Part B deductible, which is $233 in 2022, applies. After that, you pay 20% of the Medicare-approved charges.

Most of the time when ambulance transport is necessary, it is obvious. In cases where it is not, your doctor can provide a certification that it is needed. For example, a dialysis patient may need ambulance transport to a dialysis center.

What If There’s a Question?

If the ambulance service doubts that you meet the definition of medical necessity, they are required to give you a notice that Medicare may not pay. This is called an Advanced Beneficiary Notice of Non-coverage. It is given if you requested an ambulance in a clearly non-emergency situation or the company believes Medicare will not pay. (The fact that you received such a notice, alone, does not mean that Medicare will not pay; this is determined later.)

Are There Special Situations?

Yes. If you live in the states of Delaware, the District of Columbia, Maryland, New Jersey, North Carolina, South Carolina, Virginia, or West Virginia, and you use non-emergency ambulance services more than three times in a ten-day period or once a week for three weeks or more, the company may request a pre-authorization before providing services. If the pre-authorization request is not approved, Medicare will not pay for the services.