The 2016 review of Social Security and Medicare released by the Social Security Board of Trustees announced there would be no COLA for 2016 due to lack of inflation. According to an article on Bankrate.com, “Social Security doesn't expect to pay any cost-of-living adjustment, or COLA, to beneficiaries in 2016 because inflation hasn't been high enough to justify it. In 2015, Social Security recipients got a measly 1.7 percent raise...But next year is almost certainly going to be worse -- zero percent -- because the Consumer Price Index for Urban Wage Earners and Clerical Workers, CPI-W, as calculated by the Department of Labor, has gone down since January.”
On the Medicare front, those enrolled in Medicare Part B will face a 52% increase in their premiums in 2016. According to StreetInsider.com, Part B enrollees may also see an identical increase in their deductible. This means about 1 in 70 Medicare enrollees will be affected by the price hike.
Medicare Part B pays for physician visits and outpatient services. The spike in Medicare B premiums is largely attributed to the fact that physician costs are rising faster than the prices of any other market in the economy. Additionally, Medicare expenses in 2014 ($613.3 billion) exceeded Medicare income ($599.3 billion). In order to keep premiums down, Medicare needs to incur a higher income than its expenses to help combat the rising costs of physician care.
For those not enrolled in Medicare Part B, a “hold harmless” provision in the federal law says that enrollee’s Medicare premiums cannot increase by more than the increase of their Social Security benefits in any given year. Because there is no COLA increase in 2016, these Medicare enrollees are safe from premium increases.
Changes in government assistance programs can effect how you plan for your retirement. Investing your IRA funds in alternative asset markets can provide you with tax-advantaged income that remains autonomous from the volatility of the stock market, or the sway of bureaucratic shifts in medical assistance programs. Investing your Health Savings Account, or HSA, can allow you to grow your savings so you have extra funding for all current and future qualified medical expenses. Learn more about investing your HSA
Almost anything you can invest in outside of an IRA or HSA can be invested in with your account funds. Real estate, private lending, private equity, precious metals, solar energy, and land are all examples of potential retirement investment options. Most IRA providers only have the infrastructure to support stocks and bonds in their clients’ accounts. Trusted self-directed IRA account providers like New Direction IRA allow clients the freedom and control to invest in any IRS-sanctioned asset they choose to maximize their health and retirement savings.
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