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so I have a question about something stated up thread about the medical insurance. I get the part about keeping my fedearl health plan (FEHB) and also Medicare. But i am not understanding how my benefits would change to be "Medicare style" and increase my out of pocket because Medicare pays less ? If i still have both plans, even if one is primary and one is secondary, then aren't both plans still available to use? I work in health care and i know for a time when we were pulling insurance information, we followed up on questions people had about when they had more than one health plan, which was primary which was secondary.
But surely both are still available? Please can someone talk further on that. Thank you. I feel like i am missing something or not understanding.
My current health plan i picked because it has no copay whatsoever. I hate co pays. I've had it for years and it is great in my view. They give you a "pot of money" to spend and if we don't spend it, it carries over to the next year so the pot grows. There also is a reasonable "cap" for catastrophic out of pocket expense. THe one year that happened when my salary was at its lowest, I had just taken a pay cut so I could begin working for the federal service, and the cost was not bad for the emergency services needed, including ambulance and hospitalization and follow up care needed. (That was when i found out how expensive three amublance trips cost.) Also i like it because ALL preventative care is free entirely it does not come out of our "pot of money" because they recognize that preventative care keeps their costs down.
thank you again for everyone sharing their expertise, it is very helpful and i appreciate it.
I can say how FEHB and Medicare work for us. We pay FEHB and Medicare but the FEHB plan rebates back the medicare premium (and IRMAA charges) up to $250/mo. The FEHB plan is already in place to cover my DW (she is not 65 yet) and a son - the Medicare coverage is slightly different than the standard coverage with lower copays.
If you have both, your out of pocket should be next to nothing. I believe that zero copay is not allowed for Medigap policies anymore but may be available with FEHB.
where are the tables to look this up? as this is useful for retirement financial planning.
thank you.
i looked on the TSP site and could find general information on RMDs, but not the specific numbers or formula or tables to do my own calculations.
The RMD numbers come from an IRS instruction and tables - link to instruction - the tables are at the end, most probably would use table 3 on page 65. The table gives the distribution period for an age so the % is one over the number. For example the table gives 27.4 at age 72 so the % is 1 / 27.4 = 0.03649 or 3.65%.
the irs tables are based on living to a certain age .
so it is only natural that the less years left , the higher the draw since it is not based on some starting value but each years value .
it is like a safe withdrawal rate is 4% initially but as we add each years inflation adjustment our draw is no longer 4% but much higher based on the original value
I agree with this. When my brother approached me about this subject (wanted to buy an annuity with some of his cash) I convinced him to instead delay Social Security for the best annuity that is available. He was initially confused because he was done working at 66 and thought I meant he should keep working. I told him, no, you don't need to work, just delay collecting. He was able to live out of his checking account for three years and collected at 69. He said it was a great method because he also really got his spending back under control (he hated work for a long time and kept his lifestyle pretty affordable).
Plus, the fact MJ that, the annuity is never going to pay $18k per year for 20-30 years. The annuity is going to offer $500 a month or something (which will help OP decide not to do it).
An annuity that I bought in my mid-50s for $100k (and which has a survivor benefit, ie, the unused part of the premium would be returned to the survivor if I die) will pay me $1,100 per month starting at 70, for the rest of life. So, that is $13,200 per year, or $132,000 for 10 years, or $264,000 for 20 years, or $396,000 for 30 years.
The annuity that I bought for $170k when I was 52 will start paying $6k per month at 80, which is $72k per year, or $720k for 10 years, or over $1.4 million for 20 years if I attain about 6 months more than my grandfather's age of death.
But I agree that soc security is the best annuity - at least the way it is set up now. Which should not prevent a person from having additional annuities if they want more secure monthly income than soc security.
An annuity that I bought in my mid-50s for $100k (and which has a survivor benefit, ie, the unused part of the premium would be returned to the survivor if I die) will pay me $1,100 per month starting at 70, for the rest of life. So, that is $13,200 per year, or $132,000 for 10 years, or $264,000 for 20 years, or $396,000 for 30 years.
The annuity that I bought for $170k when I was 52 will start paying $6k per month at 80, which is $72k per year, or $720k for 10 years, or over $1.4 million for 20 years if I attain about 6 months more than my grandfather's age of death.
But I agree that soc security is the best annuity - at least the way it is set up now. Which should not prevent a person from having additional annuities if they want more secure monthly income than soc security.
Those annuities are not static over time. You would have to shop the same ones now and look at the pricing now. I doubt they are the same deal they were at the time you purchased even when inflation is taken into account. The other issue is taking money from deferred retirement accounts (in my brother's case) to buy an annuity one has to pay taxes on that.
I like the plan you had/have. You created a pension for yourself. Nothing wrong with that.
Those annuities are not static over time. You would have to shop the same ones now and look at the pricing now. I doubt they are the same deal they were at the time you purchased even when inflation is taken into account. The other issue is taking money from deferred retirement accounts (in my brother's case) to buy an annuity one has to pay taxes on that.
I like the plan you had/have. You created a pension for yourself. Nothing wrong with that.
You do not have to pay the taxes upfront to buy the annuity. If you (or your brother) buy an annuity in your deferred 401K/IRA retirement account, you pay tax on the entire distribution each year. If you treat it as a withdrawal and then buy the annuity out of taxed money, you pay tax on the withdrawal and the gain portion
of the distributions.
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