Plan Now, Save Later for Financial Fitness in Retirement

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Financial Fitness

Simple ways to maintain your health in retirement include eating right, exercising daily and seeing your doctor regularly. Developing a plan for making health care decisions in retirement can also ensure you stay financially fit. Follow this simple checklist to get you started:

First of all, see what employers have to offer. If you plan to leave work before age 65 when you will be eligible for Medicare, keeping affordable health care coverage is critical. Learn the coverage available from your employer when you retire. Do this regardless of when you’ll be retiring, as many employers require you to be part of their group plan for a minimum number of years in order to continue the coverage through retirement. Find out about your spouse’s plan, too, so you can determine which plan best fits your needs – and pocketbook.

Secondly, weigh your Medicare options. As you approach your Medicare eligibility age of 65, consider the many choices you have for coverage in the Medicare system. You will need to choose between Original Medicare and the Medicare Advantage Program. Under Original Medicare, you can choose either Part A or Part B. Part A, available at no charge, covers hospital stays, limited care in a skilled care nursing facility, hospice care and some home health care. Part B, available for a monthly premium, covers doctor visits, outpatient care, medical supplies and preventive services. You or your supplement plan pay any deductible or coinsurance.

The Medicare Advantage Program is a Medicare plan offered by a private company, such as a Health Maintenance Organization or Preferred Provider Organization, to provide similar benefits to Medicare Part A and Part B coverage.

You also need to decide whether you will opt into the Medicare Part D prescription drug coverage plan. Finally, you should consider whether you need a Medigap plan, which fills in some of the gaps in Medicare coverage. Visit the government website, medicare.gov, for helpful information about choosing your coverage and the deadlines for obtaining coverage.

Also, consider long-term care coverage. The need for long-term care may arise at any age, though likelier for older adults. Many people think that Medicare will pay for long-term care, but it pays for skilled nursing care only for a short amount of time and under very limited circumstances. However, if you suffer a major health crisis, it could quickly become an unplanned drain on your finances. If you have not already purchased long-term care coverage, see your financial adviser about your options.

Finally, execute an advanced health care directive. While an advanced health care directive does not serve truly a financial matter affecting health care, retirees often overlook this necessary item. You should execute these documents so someone can act on your behalf if you become disabled. Having these documents can reduce stress on your family in a difficult time.

Remember, it’s never too early to plan. Even if retirement is years away, start the planning process for these important decisions. They are crucial to your financial fitness and your health in retirement.

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