Medicare Social Security and Planning
Many Americans think Social Security and health insurance are programs unique to anyone who offers no choice or personalization. However, the fact is, taking out time to understand fully how these policies work and to consider the most effective ways to include them in a long-term financial policy can significantly increase their usefulness.
A common misconception about Social Security is that workers’ taxes are kept in personal accounts by the use of the workers who earned them. The fact is, the taxes paid by today’s workers on Social Security provide support for the benefits of retirees of these days, and also other recipients of Social Security, such as workers with disabilities, deceased survivors and dependent dependents. By working and paying Social Security taxes, you earn credits for your future benefits. The amount of credits required to secure Social Security retirement benefits depends on your year of birth. As at 2014, workers get one credit for every $1,200 they have earned, up to around four credits per annum. If you were given birth to after 1929, you will require 40 credits, an equivalent of 10 years of work, to obtain retirement benefits.
The amount you work also affects the value of your eventual benefit payments. Higher lifelong gains result in greater benefits later. If you have not worked or earned very little for years, you may receive a lower benefit amount than you would have if you had worked consistently throughout your career. The age when you start receiving benefits can also influence the size of your payments; I will discuss this in more detail later in this article. Medicare gets funding from payroll taxes and also the monthly premiums of those who leverage on the policy. Medicare is a health insurance program primarily for people 65 and older, although some young people with a specific disability may also qualify. The program helps with health care costs, although it does not insure all medical expenses or the cost of most types of extended care. Medicare comes in four parts:
Part A helps pay for hospital care in hospitals or specialized nursing facilities after hospitalization, as well as some forms of home care or palliative care. Part B is basic medical insurance that helps pay for medical services, outpatient care, durable medical equipment, home care, and certain preventive services. Part C is also referred to as “Medicare Advantage Plans”. These policies are available from private firms in some places. Individuals with Medicare Parts A and B may choose to receive all of their health care through a Part C provider. These policies combine insurance for hospital stays and medical appointments.