One of the challenges, and concerns of retirement or transitioning from permanent employment before age 65, the current Medicare age for health insurance.
Purchasing health insurance as an individual can be challenging, and can also create some angst in the decisions that we make.
Have you worked at a legacy company for an extended period of time, maybe 10 years or so?
We have continually run into situations where a former employee who has worked at a legacy company for an extended period of time, such as 10 years … may have an option for some sort of bridge or supplemental like health insurance coverage from the previous employer.
What is meant by legacy company, is a company that has been around for multiple decades …. a new startup tech company as an example, will not have such a benefit. Also, not to worry if your company has maybe changed an official name but has bones going back many decades, you still may have an option.
In almost every situation, the key is these plans are not easily discovered. In order to find out if you have an option, it’s best to dig out contact information from HR of your old employer and reach out to them directly.
This is an expense to your former employer, so it would be expected not to receive multiple information regarding such a plan, but if available it could greatly help in bridging the gap for Medicare should we be in the situation of needing coverage before age 65.
Almost every situation that we know of … has a slightly different slant of how qualifications are determined, be sure to take copious notes on how and why you may have this offer, and make sure you keep whatever contact person you have for future use.
Qualifications for such benefit can vary greatly, so again make sure that if you were being told something you again or actually able to get this coverage.
Maybe a bit of a hassle to determine if you have an option…. but if you do, will be VERY WELL WORTH the hassle!
Welcome to our Video and Audio Podcast Review of our Q1 2021 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.
In this start to a new year, we update the pictures on the Video and also the entry and exit music. Our editor actually greatly adjusted the colors and fonts of the Newsletter this year, which we really liked as well.
Click the Download button below, for a direct link to an electronic version (an early peek-good ole fashion paper versions are on their way to you shortly) and here for our Newsletter page
This Newsletter is chocked full of reminders from events and experiences we had with you in the field last year the would be helpful looking forward into 2021!
With a very large number of moves in 2020 …. much greater than we can ever recall, in this Article we remind of the Homestead.
In the year 2020 we have had more change of residences than we can ever recall over the past three decades. As a reminder, and using Texas as a template, if you live in your home on January 1 you can do what is called a homestead tax exemption. Once again through the lens of Texas, this is a particularly good tax savings exemption that everyone should do if you live in Texas.
Q 1 2021 J.K. Financial, Inc. Newsletter Lead Financial Planning Article
And just a bit more description from the same Article …
From TexasLawhelp.org – a fantastic non-profit resource we use frequently – again only for Texas residences, those living in other states may want to check for a similar organization.
What property qualifies as a “homestead?”
A “homestead” is a house or other residential structure that you own, together with up to 20 acres where the structure sits if the land is used for residential purposes. A manufactured home on a rented lot qualifies as long as you own the home. Manufactured homes must meet additional requirements for a “Statement of Ownership and Location,” but if you did not receive the paperwork from the prior owner and cannot locate the seller after making a good faith effort, you can submit the affidavit in Form 114-A.
Estate Planning Tops Our Minds
It was literally a race for the greatest increase over normal years, for folks moving to a new residence (per above) or reviewing and updating their Estate Plans.
Has Anything Changed Since My Documents Were Written?
Just because five, seven or even ten years have transpired does not mean that you automatically need to update your documents. If everything looks right, and things have not changed then those documents are likely just fine.
On the other side of the equation if things have changed in the past twelve months (or even less) that would make your documents incorrect, you likely need to do an update so your directives are appropriate.
Q 1 2021 J.K. Financial, Inc. Newsletter Second Lead Financial Planning Article
If we are not in possession of a copy, please send to us or upload to your Vault as we keep things safe and most importantly FOREVER!
Q 4 2020 ES Reminder – The Safe Harbor
Mid-month, January 15, 2022 to be exact is the final due date for Quarterly Tax Payments ( Q 4 2020 ES Tax Payments.) With a pushed out ordinary filing date due, it seems like to many we just filed last year’s taxes (2019), and here we are already rushed to complete 2020. Hence the reminder.
Lastly, if you are in a situation where you tax bill may be dramatically different from the prior year, in this case 2019, consider trueing up your 2020 taxes to at least 110% of year 2019 total Federal tax withholding. To help avert any penalties or interest.
Retirement Contribution Levels and Medicare IRMA Amounts
While we have posted these levels earlier here, and we know the formatting was a bit wonky, we wanted to review them again directly from the Newsletter.
Here are last years most common levels along with whats up for 2021 – mostly unchanged
IRMA – Income Related Monthly Adjustment Amount – Medicare Part B Surcharge
“ If your modified adjusted gross income is above a certain amount, you may pay an Income Related Monthly Adjustment Amount (IRMAA). Medicare uses the modified adjusted gross income reported on your IRS tax return from 2 years ago. This is the most recent tax return information provided to Social Security by the IRS. “
Here are the 2021 limits and adjustments:
We hope you enjoy … talk to you Next Quarter – Happy 2021 !!!
Over the next two weeks, with staggered schedules, our office, which our building manager is still continuing to ask us not to have guests, will be open sporadically. We will collectively be working remotely or out of the office on various family holiday getaways.
Donald “The Brain” is happily in a warmer climate near water, loosely connected to the office for some much needed and much earned R&R this week after a full spring, summer, and fall, of lock downs.
My time actually occurs next week after Christmas and through New Year’s.
Jen will be in and out remotely connected with a few official bookend days for holidays and long weekends throughout the next two weeks.
One big positive of the events of this year is the ease of pivot to remote for all of us!
A Gentleman‘s Agreement on Wall Street!
While in recent years we’ve seen this agreement violated, look no further than some of the sharp drop offs during this time just a year ago, generally there is an unwritten gentleman‘s agreement to “do no harm” during this time of the year. Meaning capital markets usually do not trade upward or downward in dramatic fashion throughout the remainder of the year.
Under normal circumstances the next two weeks, partial trading weeks …with closures on each Friday and half a day before the holiday trading would be BORING and very low volume….trying not to jinx ourselves here!
Newsletter Update
With a newsletter chocked full of great Financial Planning, Income Tax, and Personal reminders, and being non-market related, the Newsletter is complete and we hope to have it to you during the holidays for some possible fun reading that you may have during down time.
We think it came out fantastic, and tribute the great bulk of subject matter to you guys for the experiences, reminders, and techniques that we did this year.
Our posts here at Street-Cents will likely not be as regular and much lighter over the next two weeks as well!
Remember, as mentioned here in this urgent reminder post, Financial Institutions in every area of service are greatly overloaded for some reason this year, and as such MONEY IS MOVING SLOW…. do not wait until the last minute for a Financial Transaction, especially if it is personal!
Happy Holidays, Be Well, Be Safe, and Happy New Years!
This marks the last Part and as they say … last but not least … Mr. Clark discusses the three options for Medicare Supplemental/Gap Policy. Let it be noted, you most certainly need these, but the good news is this is finally pretty straight forward.
Direct Audio Here on our site for your viewing/listening pleasures as well as links to every full post:
Once again, neatly there is a gold nugget of information in the audio, and a trick on where to find an easy phone number to call to get a referral for help – listen up and enjoy –
Medicare Supplement Explained Three Options
Employer Offered Supplemental Private Insurance – this less often- likely best option if available – best coverage
Traditional Medicare – no network must buy a Medigap Policy A through F – Full comprehensive coverage- similar to full health coverage, but at the Medicare Level
Medicare Advantage – Like Medicare HMO – Network of People that must go through
26 Medicare Advantage plans in DFW area-
Part D may or may not be available for Medicare Advantage
Do not try to do this all by yourself- see next
Local Non-Profit Agency – Dallas County would likely be the Dallas County Agency on Aging, Fort Worth would be the Tarrant County Agency on Aging
Dial – 211 – Phone Number for Social Service Referrals – NO kidding – Texas a state that this number works completely, may not be available in all states
Welcome to our Video and Audio Podcast Review of our Q 4 2019 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.
Click Here for direct link to an electronic version (an early peek-good ole fashion paper versions are on their way to you shortly) and here for our Newsletter page
With Mortgage rates moving lower, we discuss the major items to think of when refinancing your Mortgage.
Our most clever point is we like to have an 18 month payback for the costs when refinancing… this serves as a good barometer on when to refinance, irrespective of the size of your Mortgage.
Tariff Talk
It’s been going on for a long time
Trade Wars AKA Tariff talks have been around for a long time. This is not our first rodeo… notice how trade has been more efficient over time!
End of Year Tax Reminders
While there are a lot of reach back tax items i.e. Things we can do next year for this years taxes… there are many that have a firm year end deadline-
RMD – Required Minimum Distributions
Company Related Retirement plans i.e. 401k
Charitable Donations
529 and other education programs
We hope you enjoy … talk to you in ….. 2020 WOOOW !!!
The most complex part of Medicare decisions comes from folks that work past age 65. The most important point of this entire second half of Mr. Clark’s presentation is that to get the most exact details for your situation you should check with your health insurance carrier. Frequently employers’ HR departments are outsourced and a recurring theme is the HR department is not in sync with the health insurance carrier.
Bottom line your health insurance carrier is your go to point of contact if you continue to work past age 65 as you will most certainly need to find out how they want you to handle your Medicare decisions.
Direct Audio Here on our site for your viewing/listening pleasures as well as links to every full post:
Much like our Social Security Benefits discussions, there are certain parts of Medicare Benefits that have more decisions and techniques to choose – Medicare Part B is by far the most detailed, confusing and has the most options to choose – The audio is terrific and gives more details than the bullets below – take a listen!
Medicare Part B Creation, Cost, IRMA, Benefits Options
Medicare Part B:
Doctor Bills coverage and outpatient coverage
Part B has a cost of $135/Month –
You can turn Part B down, but not a good decision unless you have current health insurance coverage “Not taking could be the worst financial decision you make” According to Clark
The $135/Month is about 1/4th of the actual premium – Government Supplements the 3/4 – see next
Income over $85k Individual or $175k Couple, you will pay more as the Government supplement goes away – IRMA – Income Related Monthly Adjusted Amount – click link for recent detailed analysis and solutions
IRMA – Everything but Roth counts towards income, including tax free, interest and anything
Started in 2005 to pay Medicare Part D, Drugs and prescription-
Can refute IRMA as administration has three year old data
The most complex part of Medicare decisions comes from folks that work past age 65. The most important point of this entire second half of Mr. Clark’s presentation is that to get the most exact details for your situation you should check with your health insurance carrier. Frequently employers’ HR departments are outsourced and a recurring theme is the HR department is not in sync with the health insurance carrier.
Bottom line your health insurance carrier is your go to point of contact if you continue to work past age 65 as you will most certainly need to find out how they want you to handle your Medicare decisions.
Direct Audio Here on our site for your viewing/listening pleasures as well as links to every full post:
Medicare Part A Explained
During the meeting, there was a lot of jumping between Medicare Part A and B, with a ton of information on Part B coming in the next Part. Early in the audio, the most important item to note is re-iteration as above, for those many of us working beyond age 65, check with your Health Insurance Provider for the best source of accurate actions needed on your part – ok, here are the bullets from the Audio for Part A Medicare:
Medicare Part A only for Hospital care
Medicare Part A is funded via the 1.45% FICA Tax from your payroll during your working lifetime, as such no cost upon retirement/enrollment
Medicare Part A (B) starts at age 65 (Not age adjusted as Social Security)
Consult your Health Provider, not HR for best post 65 age Medicare Part A decisions and elections
Once on Medicare, cannot fund your HSA – a reason you may want to defer Part A if you have full other coverage options
If still employed and you do not take Medicare, you can still fund your HSA –
By deferring Medicare A you will have a small penalty on Medicare Part D – Drugs
Social Security . Gov website to start Medicare and can choose Part A and/or Part B
Careful when you file for Medicare Part A, normal look back of six months which may void your HSA – must sync this
If you are over 65 and drawing full retirement age, you automatically have Medicare Part A
This audio is a bit longer, but full of great examples for the bullets above …coming up the more complicated decisions of Medicare Part B –
What follows will be a multiple part series as we will attempt to explain the various parts of Medicare. In this first post, a high-level explanation of just Part A and B.
The most complex part of Medicare decisions comes from folks that work past age 65. The most important point of this entire second half of Mr. Clark’s presentation is that to get the most exact details for your situation you should check with your health insurance carrier. Frequently employers’ HR departments are outsourced and a recurring theme is the HR department is not in sync with the health insurance carrier.
Bottom line your health insurance carrier is your go to point of contact if you continue to work past age 65 as you will most certainly need to find out how they want you to handle your Medicare decisions.
Direct Audio Here on our site for your viewing/listening pleasures as well as links to every full post:
Medicare Statistics, Background and Part A and B Explained
OK here we go an introduction to stats and statistics and a high-level view of Medicare Part A and B:
Medicare is far more important than Social Security benefits as the government offset of Medical Costs are likely much greater than Social Security Benefits
Bet you didn’t know Medicare was started in 1965!
Medicare’s purpose is to provide substantial benefits at very reasonable costs for retired folks at age 65
Unlike Social Security Age 65 remains the age Medicare Benefits begin for retired people
Social Security Disability receivers are automatically enrolled into Medicare after two years of disability benefits
Part A is Hospital Insurance Benefits – Prepaid
1.45% of FICA taxes used during work to prepay Part A
Part B Covers Doctor bills and out patient treatment
Part B has a cost- monthly starting premium of $135 month – there are means test that increase this cost
This cost is usually withheld from Social Security Benefit
If not taking Social Security, you will be billed directly
Welcome to our Video and Audio Podcast Review of our Q 3 2019 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.
Click Here for direct link to an electronic version (an early peek-good ole fashion paper versions are on their way to you shortly) and here for our Newsletter page
We had planned on leaving this out due to repeated appearances here in our blog and in the Newsletter – but in true “Break In” like format, as this post is completed and the video – hopefully the local wifi is strong enough for uploading … the time is spent in Austin Texas at this moment in another rain delay- the same exact place the original article was written!
Tax Talk/Review
Change Likely the New Normal
After two decades of only minor changes in the Tax Law… it was overhauled and many changes were made that were reflected in our 2018 tax returns.
This neat chart is a nice reminder of the current brackets and can be helpful in income distribution tax bracket management.
Inverted Yield Curve Update
This chart featured in our Newsletter is a slightly different term comparison of the 2 year (we like the 90 day) versus the 10 year, but a wonderful historical view of inversions and recessions. We have fully inverted for over a month now and if we use this historic guide as our yardstick a recession would be in the cards mid year 2020!
Social Security Update
We have begun a detailed review of the late spring event and it is going great. Weekly we dissect a section of Social Security Expert, Tom Clark’s presentation and give handy links to greater details and explain in bullet fashion the main points. Here is a link to the Audio on a special page here at our blog and you can also click here for a link that will pull up each complete post!
There are tons of nuances regarding Social Security, Disability, Death Benefit and Medicare decisions…we look forward to discussing many more with you as the summer weeks occur!
We hope you enjoy … talk to you near the end of Summer!
GREAT Social Security Questions for our Event this weekend
Without further ado … here is the final list.. WOW!
Last time we spoke you were VERY certain Social Security would be there for all of us upon retirement – With all of the changes, do you still feel this way?
Can you explain the divorced verses divorced and remarried benefits?
Have you ever heard of someone being offered a lump sum of retroactive Social Security benefits?
November of 2015 ushered in new laws and changes, are there any neat techniques that survived?
Can you explain non US citizen spousal benefits?
We have been told many of the benefit statements are not always accurate, understating the actual eventual benefit, has this been your experience?
How much can I earn and not receive penalties if I retire before my full retirement age?
The Full Retirement Age keeps being pushed out, will this continue? Is there a schedule?
How long do I have to report my Social Security earnings if they were not reported by an employer?
For many years I did not draw on an ex-spouses earnings by accident – using only my earnings benefit, can I request some sort of look back to get my full benefits?
If want to change my Social Security election decision after I made it and have been drawing benefits, Can I do that?
Do I have to take Social Security Benefits ? What if I do not want to?
Is it better to sign up in person or use the website, or does it matter?
My wife is not a US citizen, does that affect her spousal benefits?
Will Social Security always be there in your opinion?
What percent of people take benefits early, at full retirement age and as late as possible?
I am 65 and working with a good healthcare plan. I wasn’t going to sign up for Medicare until after I retire. However I am told a Medicare Part F; a supplemental plan eliminating deductibles, will not be available after 2019; Should I enroll and sign up for Part F?
I was married for more than 10 years to a high income earner, if I get remarried to my new spouse who is not a high income earner, will I give up benefits?
Have you seen any of the on-line Social Security Optimization Programs? If so, any you like better than others? (From JK)
What are your thoughts about an income based phase out of Social Security in the future? Much like the penalty for W-2 income and having started early Social Benefits ? (From JK)
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investments may be appropriate for you, please consult your financial advisor prior to investing!
Background
The is the vocal portion of J.K. Financial, Inc. a Dallas Texas Based Fee Only Total Wealth Financial Planning Firm. Founded by John Kvale, a Dallas Texas Fee only Financial Planner and Total Wealth Manager.
Q 4 2019 Newsletter Video Audio Podcast Review By John Kvale
Welcome to our Video and Audio Podcast Review of our Q 4 2019 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.
Click Here for direct link to an electronic version (an early peek-good ole fashion paper versions are on their way to you shortly) and here for our Newsletter page
Let’s get going!
Q 4 2019 Newsletter
Click for PDF/printable version of Newsletter
And here is your review!
Is it Time to Refinance?
With Mortgage rates moving lower, we discuss the major items to think of when refinancing your Mortgage.
Our most clever point is we like to have an 18 month payback for the costs when refinancing… this serves as a good barometer on when to refinance, irrespective of the size of your Mortgage.
Tariff Talk
It’s been going on for a long time
Trade Wars AKA Tariff talks have been around for a long time. This is not our first rodeo… notice how trade has been more efficient over time!
End of Year Tax Reminders
While there are a lot of reach back tax items i.e. Things we can do next year for this years taxes… there are many that have a firm year end deadline-
We hope you enjoy … talk to you in ….. 2020 WOOOW !!!
John A. Kvale CFA, CFP
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com
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Posted in Audio, FOMC, General Financial Planning, Interest Rates, Investing/Financial Planning, Market Comments, Medicare, Newsletters, Podcast, Political, Tax Related, Vault, Video
Tagged End of Year Tax, Home Mortgage, Interest Rates, Mortgage Refinance, Perot, Property Tax, Social Security, Tax Reminders, Tom Clark