Medicare and Social Security Benefits While Employed
Question: I will be 65 in Oct. Am I able to collect any old age benefits, qualify for Medicare/Medicaid and still work? I will earn a BS in May, 2012 and plan to work till I can’t, thus contributing to my Social Security.
Answer: Medicaid is a Federal program for people and families of any age with very low incomes. Medicare is the Federal program that provides health insurance for people 65 and older. You may qualify for both but if you're working you probably won't. Anyone 65 and older may get Medicare. If you've worked and earned enough credits (which the majority of people have) or you are the spouse of someone who has, you do not pay a premium for Medicare Part A. There is a premium for Medicare Part B. Most people pay the base premium which is $115.40 this year but people with higher incomes pay more. If you will be working for a large company, 20 or more employees, you may want to postpone enrolling in Medicare Part B because your employer's health plan (if they offer one) will be primary to Medicare. You are allowed to do this without a penalty. Here is a video about Medicare and large group health insurance:
Here is a link to a question on my blog about using Medicare or Group Health Insurance: http://blog.medicareanswersfromconnie.com/2010/05/choosing-medicare-or-group-health.html
You may begin collecting Social Security retirement benefits at age 62; however the benefits will be reduced. Here is a link to Social Security that provides details: http://www.socialsecurity.gov/retire2/agereduction.htm
You may work while collecting Social Security Benefits prior to retirement age (66 for you) but may only earn $14,160 per year or your benefits will be reduced. The limit and reduction changes as you near retirement age. Here is another link to Social Security that provides details on allowable earnings prior to and after retirement age: http://www.ssa.gov/pubs/10003.html
Waiting to draw Social Security until age 70 gives you the greatest benefit. Should you choose to begin collecting Social Security prior to retirement age, you may repay what you have received at age 70, interest free right now, and essentially start over at the higher percentage pay out.