What options for health insurance do you have if you choose to retire before age 65? Although they are not required to, you may be able to get COBRA-like coverage from your employer.

As an added retirement benefit, your employer may allow you to pick up the premium on your policy; although paying 100% of your premium may initially appear to be an expensive option, purchasing an individual policy apart from a group may be even more costly and not provide you with the level of coverage you previously had.

Some companies are offering basic high-deductible insurance reasonably in the hopes that they will be able to enroll you in Medicare Part C (supplemental insurance) when you retire.

Another option is to budget and save money to cover your anticipated medical costs for the time period between retirement and age 65. If you are in very good health, this may be a viable alternative for you.

Planning for retirement is an important issue; the earlier you start planning, the better. Realizing the Medicare does not pay all of your medical expenses, you should budget money for medical expenses even after retirement.

Medicare was signed into legislation in 1965 as an amendment to the Social Security program and is administered by the Center for Medicare and Medicaid Services (CMS) under the Department of Human Services.

Medicare provides medical insurance coverage for over 43 million Americans, many of whom would have no medical insurance. While not perfect, the Medicare program offers these millions of people relatively low cost basic insurance, but not much in the way of preventative care. For instance, Medicare does not pay for an annual physical, vision care or dental care.

Medicare is paid for through payroll tax deductions (FICA) equal to 2.9% of wages; the employee pays half and the employer pays half.

There are four “parts” to Medicare: Part A is hospital coverage, Part B is medical insurance, Part C is supplemental coverage and Part D is prescription insurance. Parts C and D are at an added cost and are not required. Neither Part A nor B pays 100% of medical costs; there is usually a premium, co-pay and a deductible. Some low-income people quality for Medicaid, which assists in paying part of or all of the out-of-pocket costs.

Because more people are retiring and become eligible for Medicare at a faster rate than people are paying into the system, it has been predicted that the system will run out of money by 2018. Health care costs have risen dramatically, which adds to the financial woes of Medicare and the system has bee plagued by fraud over the years.

No one seems to have a viable solution to save this system that saves many people throughout the country.

Short term disability pays a portion of your wages should you be out of work due to injury for up to one year. Some employers pay for this benefit for their employees, some offer it for employees to purchase.

If you have a pre-existing medical condition, the time to enroll is during the initial enrollment period when a medical exam is not required.

Replacement of wages is only partial; insurance underwriters, as well as your employer, want you back at work as soon as possible. Usually there is a waiting period of 14 days in which you will not receive payment.

Long term disability policies are purchased to replace what your potential earnings would be from the time you become disabled until age 65 when Medicare would be available.

For instance, if you are 55 and make $40,000 per year, you should purchase a policy for $400,000.

You cannot get a long term disability policy if

(1) you are or are soon to be pregnant,

(2) make less than $18,000 per year,

(3) are unemployed, or

(4) you are required to carry a weapon for your job.

Typically, the waiting period for long-term insurance to kick is at least 60 days and as much as a year.

Disability insurance is an important aspect of your overall insurance coverage plan, and if your employer offers it as a benefit you should definitely consider it as a wise investment.