Re-Tire-Ment! - SS, Medicare, Parts A,B,D, et alW-O-W!
Duchess and I are nearing the end of the process of retirement. Perhaps "process" is much too kind a word.....I believe I like "project" much better!
Duchess retired from our employer, a major hospital, at the end of April 2006. I stayed on (to gain one more year in retirement money) until the end of August 2006.
Yesterday we began the final act of this project as I officially applied for Social Security & Medicare....both to begin January 1, 2008. On that day I turn 65. My delay in seeking earlier Social Security relates to my continuation as a "contractor" for the hospital following my retirement.
Between her retirement date and yesterday we have each experienced many confusing, complex, and depressing moments. They involved things for which we felt prepared, but found we were not.
For the uninitiated, we had presumed that finalizing our retirement funds from our employer would be a fairly cut-and-dried process. NOPE.
You receive no word from the employer for 30 days AFTER YOUR LAST CHECK! That means the process does not begin until then. If you have vacation pay, etc. the process can drag on for 60 or more days. Also, your immediate superior has to submit paper work to the hospital to make your retirement official.
Once word has been sent, and pay has stopped, you will receive an application for retirement funds. This has to be completed and mailed back. Once another 30 days or so has expired, you will receive another letter from the retirement group. Now you have to choose among several options for your money. Take a monthly payment as long as you live; take a lessor amount each month with a survivor payment to your spouse if she/he outlives you; take your money in a cash payout (they will deduct 20% off-the-top for taxes); take your money as a rollover into an IRA investment fund.
We chose the last option as it is our feeling that we'd prefer to invest our own money, and upon our death have the funds left for children/grandchildren. We are fortunate enough to not have to use the money immediately, so we can plant it and let it grow!
Duchess finally got the rollover into our IRA investment at the end of September! FIVE full months after she retired. By the way, in Florida the employer has a full six months to get through this process....they use most all of it! Our thought was of those folks who might retire without a nest egg on which to live for those months. My money took about the same time, and I jumped through the same hoops as had she. Obviously the process is not impacted by longevity in the job as Duchess had 33 years while I ended with completion of my 14th year at the facility.
One of our surprises was the fact that the employer provides no real planning device for the completion of your retirement conversion. In fact, they either will not, or cannot provide for you the exact amount of money you will receive until you are nearing the end of the process. That leaves one also unsettled as to what you will actually have. Not a pleasant process to be sure.
I'll address that tomorrow!