Yes, an interesting list for sure. Colorado would be near the top of my list. But they list Washington state near the bottom? I think not, and like you say, the area of the state matters a lot. And certainly personal preferences matter greatly. For example, Florida, Texas, and the southern states would be low on my list, as things like hurricanes, tornadoes, violent weather, heat and politics would rule those out for me. I’ll stick with my moderate weather, lack of natural disasters, no state income tax on my pension or 401K withdrawals, great health care, water and mountains to look at every day, those factors are important to me.
I think a huge factor is if people have already purchased property in high cost of living areas. I wouldn’t want to need to purchase right now in many places.
To me it makes sense to have funds available outside of IRA/401k - some we have in our checking account, and some we have in a personal stock account (invested in indexed funds). We look at what major purchases/spending we have in this year and the next.
You can also decide to perhaps move money from IRA/401K to Roth IRA.
That does make sense. My goal is to stay in the 24% tax bracket, so I’m thinking it would be wise to withdraw the max from our 401Ks to optimize our tax rate for that reason. Then again, the more we withdraw, the more it affects the health care costs that we can deduct. I haven’t found a good tax calculator that accounts for the new tax law changes, so anything we do right now would just be a guess.
How I’m reading it is your standard deduction goes up.
Effective for 2025 through 2028, individuals who are age 65 and older may claim an additional deduction of $6,000. This new deduction is in addition to the current additional standard deduction for seniors under existing law.
The $6,000 senior deduction is per eligible individual (i.e., $12,000 total for a married couple where both spouses qualify).
Deduction phases out for taxpayers with modified adjusted gross income over $75,000 ($150,000 for joint filers).
Qualifying taxpayers: To qualify for the additional deduction, a taxpayer must attain age 65 on or before the last day of the taxable year.
Taxpayer eligibility: Deduction is available for both itemizing and non-itemizing taxpayers.
Taxpayers must:
include the Social Security Number of the qualifying individual(s) on the return, and
Medicare Advantage models and other insurance changes – some/most of it is being pushed by insurance companies that want to get you on their plan and then they make changes with their plan that may limit your healthcare options. I know some that do fine with their Medicare Advantage – but it is not something that can generally be talked about; region specific/plan specific/person specific – short and long term.
Most things with insurance, you find out how good your plan is when you really need it.
Some actually try to make the ‘sell’ to state insurance commission - which allow various products that meet regulatory guidelines. Recently, a one- page add spoke about what one insurance company was proposing to our state regulators, and what the weaknesses were for customers.
Laws change.
It is frustrating that Medicare has to test out limiting certain services to prior authorization to stop fraud and abuse. To me, if a MD or service provider has out of norm types of services, those providers either need more documentation and pre-authorization, and an investigation should ensue.
Correct, I am looking forward to the higher deduction, which I will be eligible for. However, I was hoping to take out some IRA funds with some tax advantage prior to my RMD years. But that won’t work out.
IMO, we should have more pre-certs as just part of the deal.
btw: Medicare Advantage plans cost the federal government more than Original Medicare, so of course insurance companies want to enroll more folks into their Advantage plans – as they make a higher profit margin.
Many people on Medicare Advantage plans are sick, poor, and elderly - and they will cost person to person more than traditional Medicare with Part B Supplement.
Medicare Advantage want to enroll healthier people on their plan to make more money. However for consumers who can afford and want to use traditional Medicare and part B supplemental coverage, that is a choice I make and want to keep it.
The MDs and other providers that are pocketing lucrative discounts from sellers – services not needed/necessary for many – they are abusing the system. From time-to-time, this has come to light with abusers. The penalty to these physicians is very harsh – but they have defrauded Millions.
Those abusing the system are hurting the MDs that are carefully following Medicare for their patients – PCPs are going to ‘go away’ if Medicare continues to make it so PCPs can’t service their patients on Medicare reimbursements (cost of service, overhead). We will be seeing NPs and PAs. Some of that is going on now - our PCP is pretty much limited to our scheduled 6 month appointments. Any other more immediate needs we go to urgent care (owned and run by area hospital) and see a NP.
As an Administrator and CFO of a specialty medical practice, for many years (1990 and before) PCPs had to balance having only a certain % of their patients be on Medicare to cover their practice costs due to the Medicare reimbursements.
The thing I am looking forward to most with Medicare is that for now my state is not implementing pre authorizations!
The hoops we have to go through! For stuff that was authorized and then denied.
And then there is the special place Walgreens speciality pharmacy holds. We will still have to go through pre authorization for my husband’s tier 5 medication but I’m hoping the new pharmacy is better!
Some may get ‘sold’ on Medicare Advantage having vision and dental. Those are relatively small costs in comparison to what a Medicare Advantage plan can limit on medical – limits on options and care; getting pre-certification for some services, etc.
I understand. Someone on Medicare Advantage may not ‘feel’ the medical limitations while they are relatively healthy, and they are on a tight budget, or only want to allocate certain funds to monthly/yearly health insurance costs.
We pay our dentist for coverage with various things (self-insure a ‘dental plan’ directly with him) an annual fee, and get a discount on other services (DH is getting a crown, and a discount on that). We pay a small monthly amount for Vision Service Plan (VSP) for DH - and get vision services discounted with that plan.
I am talking about much older individuals being a lot sicker – and comorbidity diagnoses. Being between the Slow-Go and No-Go in activity level.
We all know one does not qualify for Medicare until age 65.
Some people (like DH and me) had employer health insurance until we got on Medicare. When DH retired at 64 1/2, he went on my employer health insurance, and I retired months after DH turned 65, when I turned 65.
DH’s aunt and uncle, through uncle’s union, built up money, probably in a health savings account, so they had health insurance paid for and health insurance until they qualified for Medicare.
Some on this thread are contemplating retiring before 65/Medicare, and planning how to do so.
Our Medicare supplement includes a debit card to use for fitness centers - and we take advantage of that.
Traditional Medicare doesn’t cover everything - just medically necessary stuff. I just had a minor procedure done that wasn’t covered by Medicare until recently … Medicare was convinced by data that allowing it was more cost effective in the long run. If they start pre-certs for what they cover, it will increase costs … someone has to look at every request and make a determination based on the facts of that particular request … or they can just use AI and let folks languish in hoop-jumping land as they wait for important care. Instead, they should be using AI to find doctors or hospitals that seem to be prescribing outside of norms & look into what is going on (it could be justified, of course, based on the patients they serve). In my case, had I not been able to get the procedure, my condition could have advanced to something more serious and therefore more costly for Medicare.
FYI - This link will supposedly capture new tax laws, enables modeling of simplistic estimates for estimated taxes etc
I came upon it when trying to find a way to compare Married filing jointly vs Separate. It seems like Joint is usually recommended for lowest taxes. I ran a few scenarios where it seemed like not a big difference. (Of course in our case, we are lazy and like having just one tax return. Was curious for friends’ situation).