There are some retired folks (probably not Mainers) who can afford to buy in to one of those splendid retirement communities in Maine where it “only” costs $200,000 to “buy in,” plus your monthly payment of several thousand dollars (including maintenance).
In reality, there are more of us who never worked for a company with a pension plan, or for the government (military, municipal, state or federal) and whose primary source of income as we age, is Social Security.
Should we all rejoice with thanks for the cost of living increase in Social Security? One of my younger friends was visiting recently. Unaware of the reality of retirement, she asked me what I’ll be doing with this annual bonanza, or as she referred to it, “your raise.”
By the time this increase reaches my bank account, part of it will already have been deducted for the increase in Medicare Part B that goes up to $88 a month in January. That’s not the prescription drug benefit, it’s the part of Medicare which covers doctors’ bills and associated lab fees. So, right from the start, a percentage of my big raise will be gone.
I told my young friend I had thought of taking the balance – about $30 after Medicare deduction – and going out to eat, but first I had to open the mail and see if the budget would handle this extravagant use of money. We sat at the table and had some coffee while I went through the small stack of envelopes. She was particularly interested in my hesitation to make a spending commitment, since she is planning her own retirement and is looking forward to getting that Social Security check each month – and the raise that you don’t even have to ask for, according to her understanding.
In the mail, a notice from the cable television company announced a price increase of “only” a couple of dollars a month. There were several mailings from insurance companies competing for my monthly Medicare Part D prescription drug premium. That premium would “eat up” the balance of the $30 a month reaped by the Social Security increase.
Quite a lot of the mail was thrown into the wastebasket. The three insurance company mailings, along with the applications for credit cards, but one envelope remained.
A letter from the state’s Department of Human Services announced that since my income had gone up (thanks to the Social Security increase) my big $10 per month in food stamps would be discontinued. I was never sure how I ever qualified for food stamps, even $10, but I think it was at the time when I applied for, and received, fuel assistance. That was four or five years ago and every month since then, I’ve received, signed and returned a qualification update form for the food stamps. Just thinking about the cost to generate all those forms boggles my mind.
My friend refilled her coffee cup and said she had set up an appointment at the Social Security office and also with her employer’s human resources department to go over her company pension plan, in preparation for retiring. I agreed that this was a good start and to take a look at the pension plan options, since so many companies are discontinuing these pensions.
We talked about a potential trip in the spring, but she recalled that the gas prices almost prohibited a long trip. That reminded me about the latest increase in oil costs and the half-empty tank in my cellar. Turning the electric stove oven on for a little while to take the chill off won’t be an option, given that the cost of electricity will also be going up.
As she got ready to leave, I told my friend to remember to pick up some two-cent stamps – postage would be going up in January and she’d need these stamps to put with her 37-cent ones.
We didn’t discuss again how the Social Security “raise” would be spent and her parting comments were about rethinking retirement. A good idea for anyone contemplating early retirement – rethink it.
Send questions/comments to the editors.
