Episode Transcript
[00:00:00] Speaker A: Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment and is not a solicitation or recommendation of any investment strategy.
Welcome to Reyna Retirement. Reyna Reyes has dedicated her career to helping people make smarter financial decisions. Reyna Retirement is all about breaking down complex financial concepts into language you can actually understand.
Now here's the co founder of American Federal Benefits Consultants, Reyna Reyes.
[00:00:39] Speaker B: One of everyone's favorite songs, I think, was sung by Louis Armstrong and I think to myself, what a wonderful world and it's a wonderful world he sings about. But it's a big beautiful bill that I'm talking about today. And we all know what we're talking about with the big beautiful bill. It was talked about all through the year of 2025. We're what was going to be in it, who was cool with it, who was opposing it and what part of it were they opposing and what part of it were they cool with and blah blah, blah. But the part I want to tell you about today is specific to taxes and how it relates to Social Security. So remember the big beautiful bill? They were saying no tax on tips and no tax on Social Security. Well, it turns out they couldn't just wipe tax away for all the Social Security recipients or beneficiaries rather, but they made some provisions. So what's the magical age of 65 respective to health insurance? What do you get? Medicare. So if you're a federal employee and you're age 65 or older, you automatically are going to have Medicare A at least. Remember, it's no cost for Part A. Now many of y', all, while you're working, you're going to delay Part B, so you're not going to have the cost of Medicare Part B. You're also most commonly going to delay Social Security while you're working.
But fast forward and you retire at some point and you decide, hey, I'm going to flip the switch, turn on my Social Security. When you do, remember you're going to start receiving money.
When you do that also they're going to ask you, hey, are you going to turn on Medicare Part B? Well, the first part of that, you want to reach out to me and my team. We are Medicare specialists, especially as it pertains to the federal government and what it means with your FEHB or your PSHB and what you may want to do, what you may want to avoid what your options are. What are they going to cost you in terms of premium and then on the back end in terms of co pays, coinsurance and prescription meds. But once you do turn on that Social Security because you're already in this example over age 65 and your spouse might be also, you will have the magical big beautiful bill $6,000 tax deduction, and that is per person if you're married. So if you're married, that is $12,000 deducted off of your taxes because of this bill. So who can have this? First of all, you got to be over 65 years old. Who could not have this. If you're making way too much money, you're not going to have you're not going to get the benefit of that tax deduction. Raina, what is too much money? If you're single, that is going to be phased out at $175,000. That is gone at 175, but it's phased between 75,001 75. So pretend you're making a hundred thousand dollars a year and you're going to have access to almost the $6,000 deduction. It'll be a lower deduction because you make a little more money so you don't need it as badly. And so you'll have a deduction, but maybe not the full six grand. So hope that makes sense. Now, if you're married, it's going to be a hundred percent gone when you and your honey bunches together make $250,000 a year. Now phased between 1:50. So if you make 175,000 or 200 between the two of you, betwixt the two of you, they will. It'll reduce that $12,000 tax deduction between the two of you, but it won't be gone. You'll get some. You just ain't going to get all of it. So under 150 you get it all. Above 150, you're going to start getting less. After 250 you ain't getting none of it. But it's only set to last for a couple of years. Now it might continue, which would be cool, but it's not set to last after 2028 as it currently stands. So if you're planning to retire in 2029, ear muffs don't even listen to this because it doesn't pertain to you unless things change. Remember we had the Trump tax cuts that were set to sunset in 2025 and then the bill got passed to just maintain that so many people were taking action to, you know, get some taxes out of the way and Roth conversions in anticipation of those tax benefits going away and then they ended up staying. So who knows, maybe this will stay also. That could be pretty great and you might have that benefit as well. So somebody like me in, you know, us in our 40s, we in our 40s, we have zero plans for this right now. But you never know. Things can get extended, changed and continued on. So if you are about to retire or just retired and you're over 65, I would encourage you to reach out to us and let's just have a chit chat, see what's going on, what options you have, especially with Medicare and how you might save money on some of the Medicare scenarios in your area in addition to your FEHB or Postal Service health benefit plan or in lieu of there's a lot of different versions of this. So that's a talk for another day. Specific to the health insurance. But understand we know what your options are. We can help you and and our goal is to put them into the right perspective in order so you a understand them b understand what the costs are and potential pitfalls or ramifications and then see what may be best for you and yours. Reach out. We can help you with any of that. We'll talk to you soon.
[00:05:53] Speaker A: Thanks for listening to Reyna Retirement With a strong commitment to ethical standards, Raina works hard to find the right solutions solution for each individual or family who reaches out for advice. To contact rena directly, call 850-450-6500. That's 850-450-6500. Or to reach the team at American Federal Benefits Consultants, call 1-800-872-8857. That's 1-800-872- 8857. You can also go online to americanfederal.org not affiliated with the United States Government. Opinions expressed are subject to change without notice. These opinions are not intended as investment advice nor do they predict future performance of any product. All information provided is believed to be from reliable sources. However, we make no representation or warranty as to the accuracy of any statement. The information is intended to be educational in nature and does not provide a guarantee or specific result. All copyrights and trademarks are the property of their respective owners. American Federal Benefits Consultants is an independent organization, not a government agency or affiliated with the Federal Government or any state State government. The terms CSRS, FERS, FEGLI and FEHB are all registered trademarks of the U.S. office of Personnel Management, American Federal benefits consultants, agents consultants, or any independent contractors do not provide tax, legal or investment advice and do not engage in the solicitation or sale of securities. Consult with your tax advisor or attorney regarding specific situations.
