The Senior Scene

In the 21st century, more women work, pay Social Security taxes, and earn credit toward monthly retirement income than at any other time. Yet, on average, women face greater economic challenges than men in retirement.

Nearly 55 percent of the people receiving Social Security benefits are women. Women generally live longer than men while often having lower lifetime earnings. And women usually reach retirement with smaller pensions and other assets compared to men. These are three key reasons why Social Security is important to women.

A woman who has worked and paid taxes into the Social Security system for at least 10 years and have earned a minimum of 40 work credits may be eligible for benefits.

Once you reach age 62, you may be eligible for your own Social Security benefit whether you’re married or not and whether your spouse collects Social Security or not. If you’re eligible and apply for benefits on more than one work record, you generally receive the higher benefit amount.

The sooner you start planning for retirement, the better off you’ll be. Women-specific information is at www.socialsecurity.gov/people/women.

Source: Social Security Administration

Social Security cares about accuracy, and we want you to get the exact benefit amount you deserve. Changes in the law affect how we calculate monthly Medicare Part B (medical insurance) and Medicare prescription drug coverage premiums.

Medicare Part B provides coverage for physician services, outpatient hospital services, certain home health services, durable medical equipment, and other items. Most beneficiaries will pay a standard premium for Part B coverage. Some beneficiaries may also pay a late enrollment surcharge. A small number of beneficiaries with higher incomes will pay a higher Part B premium based on their income.

Medicare prescription drug coverage helps pay for prescription drugs. Plan costs vary depending on the plan, and on whether you get extra help with your portion of the Medicare prescription drug costs. A small number of beneficiaries with higher incomes will pay a higher prescription drug premium based on their income.

If you’re a Medicare beneficiary who must pay more for your Medicare Part B or Medicare prescription drug coverage premium because of your income, and you disagree with the decision, you may request an appeal. The fastest and easiest way to file an appeal is at www.socialsecurity.gov/disability/appeal. You can also read more at www.socialsecurity.gov/pubs/EN-05-10125.pdf.

If your income has gone down due to certain specific circumstances, or if you filed an amended tax return, you can ask for a new decision without having to file an appeal. See our fact sheet, “Medicare Premiums: Rules for Higher-Income Beneficiaries” (SSA Publication No. 05-10536), at www.socialsecurity.gov/pubs/EN-05-10536.pdf.

Source: Social Security public affairs office.

Senior Resource Group (SRG) has introduced a service aimed at reducing readmission rates to hospitals for residents of the senior living communities it operates, including one in Pierce County.

Officials said the program focuses on helping residents receive supportive care when they transition back to a community after a hospital stay and lessening the potential of returning to the hospital. SRG encourages collaboration with healthcare providers to reduce readmission rates and obtain the best outcomes for patients, said Isaac Hagerman, a vice president of the company.    

SRG’s 32 communities include Narrows Glen in Tacoma, the only one in Washington.

As an entrepreneur, odds are you’re spending more time thinking about stepping into your business than stepping out of it and entering retirement. Though it might be difficult to focus right now on when you or your employees are going to retire, spending a bit of time to set up a small business retirement plan can have huge advantages in the future.

We all want to live well in our senior years, and the best way to do that is to ensure you have enough money to retire and live on. Most people know that the longer your money is invested in a retirement plan, the more chance it has to grow. This means the sooner you set up a small-business retirement plan, the better it will be for you and the other plan participants.

Small-business retirement plans are designed to provide maximum benefits to you as an employer and to your employees. Some of these benefits include:

• Providing income after retirement.
• Simple to set up and administer.
• Generous contribution limits for employers and employees.
• Employer contributions are tax-deductible.
• Employee contributions are not taxed until money is withdrawn from the plan (except Roth plans).
• Money invested in the plan grows tax-free.
• Employees over the age of 50 can take advantage of special rules to contribute more.
• Tax credits can cover part of the cost of setting up a retirement plan.
• “Savers” tax credit for employees on low incomes who make retirement plan contributions.
• Roth plans can be added to 401(k) retirement plans to allow after-tax income to be invested in retirement.

As you can see, there are substantial benefits to starting a small-business retirement plan. Your employees will also appreciate being able to save for retirement, which can help you attract and retain high-quality, engaged workers.

The main benefit to businesses’ bottom line is the tax advantage: There is no tax on employer contributions, and if you contribute to a traditional plan as an employee, you won’t be taxed until you take the money out.

You can start a small business retirement plan as an LLC, S-Corporation, C-Corporation or sole proprietorship.

Small-business retirement plans generally fall into one of the following three broad categories: IRA-based, defined contribution, and defined benefit. Each of these contains several specific retirement plan options:.

• The IRA is one of the most common types of small-business retirement plans. Individuals can set up this plan on their own, but sometimes an employer will offer assistance. The individual and employer can make contributions, and the amount available at retirement is based on the total contributed and the investment growth of these funds over time.
• Defined contribution plans are set up by an employer and include the commonly used 401(k). These plans don’t promise a specific amount at retirement; instead, an employee commits to funneling a certain amount of their salary into the plan on a regular basis. Employers can also contribute. When an employee retires, they receive the contributions they have made, adjusted for any investment gains or losses.
• Defined benefit plans promise to pay a certain amount when the employee retires, as a monthly stipend or large lump sum. The benefit amount is typically calculated as a percentage of the employee’s salary multiplied by how long they and the employer have been contributing to the plan. Pensions are a common example of a defined benefit plan.

In almost all cases, employer contributions to employee retirement plans are tax-deductible. However, the way employees are taxed on retirement plans does differ.

With a standard retirement plan, employees are not taxed on any income they contribute to the plan — that income is effectively tax-deferred. However, they are taxed when they withdraw money from the plan, hence the tax is deferred until later.

With a Roth plan, an employee contributes income that has already been taxed. This means there is no additional tax deducted when the retiree withdraws money from the plan later.

Employees should speak with a financial adviser to understand the likely impact of investing in standard versus Roth plans. Sometimes a combination of the two can be the best choice.

When it comes to setting up your retirement plan, it’s best to speak with your accountant and/or financial adviser to learn which plan would be best for you, your business and your employees. These professionals can also help you complete all the necessary paperwork so you can offer a retirement plan that works for everyone and keeps employees happy.

Paul Maplesden, who wrote this article, is a freelance writer and a small-business owner. This article was originally published on the Incfile blog.