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Turning 65 in the U.S. means finally being able to rely on Medicare covering most of your health expenses. But before you join the 67 million Americans enrolled in this program, it’s important to understand what’s covered and what’s not.
If you have already been receiving Social Security benefits for at least four months when you turn 65, you’ll automatically be enrolled for Medicare Part A — but you will need to sign up for Part B and other coverage for yourself.
Navigating the rules around Medicare can feel overwhelming — especially when mistakes can end up costing you dearly. You could easily overlook important deadlines and end up with gaps in your coverage, higher out-of-pocket costs, or even miss out on advantageous tax breaks.
And when you’re living on a fixed income, the last thing you want to do is leave money on the table. Here are three costly Medicare mistakes and how to avoid them.
Choosing coverage without research
Medicare and Medicare Advantage plans have a number of differences. Not understanding these means you could be overpaying for a plan that’s filled with features you don’t need.
Medicare plans are offered by the government and designed for those aged 65 or older or qualifying individuals with certain disabilities. Private health insurance companies offer Medicare Advantage plans for those age 65 and up.
If you are on the cusp of retirement and are wondering about your healthcare expenses or your ability to meet your out-of-coverage needs, getting ancillary health insurance can ease your worry.
With U65 Health Insurance, Americans under the age of 65 can compare health insurance offers from leading insurance providers.
Simply enter some basic information about yourself and your finances, and U65 Health Insurance will compile and display offers from leading insurance providers like United Health, Anthem, Kaiser, etc., in less than five minutes.
Before signing up for any plan, ask to see the plan’s current formulary, which is a list of the medications a plan covers. And be sure to confirm if your doctor and providers are covered under a potential plan.
Not looking over whether your current doctor and preferred providers are covered under the plan you choose could end up costing you thousands of dollars in out-of-pocket costs.
Not budgeting for out-of-pocket expenses
Taking care of yourself during old age can be difficult for many, especially if you have a disability or chronic illness. According to the Administration for Community Living, Americans turning 65 today have a roughly 70% chance of needing long-term care services in some capacity during their golden years. However, Medicare typically doesn’t cover long-term care in a nursing home.
With costs skyrocketing, making other arrangements like getting long-term care insurance can ease the burden on your finances, making sure your nest egg doesn’t take a direct hit.
As of 2023, the cost of a private room in a nursing home averages around $9,733, while the median cost of a semi-private room is $8,669.
You can get long-term care insurance through GoldenCare, a leading privately held long-term care insurance brokerage.
GoldenCare offers different options based on your needs, including hybrid life or annuity with long-term care benefits, short-term care, extended care, home health care, assisted living, and traditional long-term care insurance.
Get a free quote from GoldenCare within minutes. Simply enter some basic information about yourself, and a licensed insurance agent will contact you to discuss your needs, with no obligation to enroll.
You can also get term life insurance to ensure your loved ones are taken care of after your passing.
Ethos Insurance offers fast and affordable term life insurance with flexible coverage options within just five minutes.
You can get a policy with up to $2 million in coverage starting at just $2 per day. The best part? You don’t need any medical exams or blood tests to get qualified.
Eligible policies with Ethos can also get a free legal will.
Not having an emergency fund
If you want a low-risk option to invest your discretionary funds, consider investing in a certificate of deposit (CD). The rates offered on CDs are typically higher than standard rates offered on saving accounts, but the money remains locked in during the term of the deposit.
You can compare rates on CDs offered by different banks and credit unions nationwide through SavingsAccounts.com.
Their online comparison tool provides up-to-date information on rates, terms, and features offered by different institutions, making it easy to find the best option for you.
If you want your funds to remain accessible, open a high-yield cash account with Public and get up to 4.35% APY. In comparison, the national average interest rate on savings accounts is 0.42%, according to the Federal Deposit Insurance Corporation (FDIC).
Public’s high-yield cash account charges no fees and offers unlimited transfers and withdrawals. Plus, you can get 20x the standard FDIC insurance coverage.
Looking for more options? Check out the Moneywise best high-yield savings accounts of 2025 that can earn you more than the national average of 0.42% APY.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
