Worried About Medicare Costs in Retirement? 3 Ways to Shrink Them.

Once you retire, a good number of your expenses are likely to decrease. You might spend less on housing if your mortgage is paid off. And if you're not commuting to work every day, your transportation costs should shrink.

But if there's one expense you're likely to pay more for in retirement than during your working years, it's healthcare. And one myth you don't want to believe is that your healthcare expenses won't be so high under Medicare.

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In reality, Medicare can be more expensive than you bargained for. So if you're worried about your Medicare costs, here are a few key moves you can make to spend less on healthcare later in life.

1. Sign up during your initial enrollment window

Your initial Medicare enrollment window spans seven months. It begins three months before the month you turn 65 and ends three months after that month.

If you don't sign up for Medicare during that seven-month window, you may get stuck paying extra for coverage -- for life. Medicare will tack a surcharge onto Part B for each 12-month period you were eligible to enroll but didn't.

Waiting too long to sign up for Medicare Part D drug coverage could also result in penalties. So that's something to be mindful of, too. Your Part D enrollment window is the same as Part B.

2. Stay in-network if you're on Medicare Advantage

Some seniors choose to get coverage through a Medicare Advantage plan instead of sticking with original Medicare. These plans commonly offer benefits beyond what original Medicare covers. Plus, with Medicare Advantage, you may find that you're spending less on health coverage overall -- that is, if you follow your plan's rules.

One thing you should know about Medicare Advantage is that these plans generally limit you to a specific provider network. Going out of network could result in higher costs for you. It's important to check your providers' status every year, since it's possible for a given doctor to be in-network with your Medicare Advantage plan one year but out of network the following year.

3. Get supplemental insurance as soon as you're eligible

If you're enrolling in Medicare Advantage, you can't sign up for supplement insurance known as Medigap. But if you're sticking with original Medicare, it pays to buy a Medigap plan during your initial sign-up window.

That window is not the same as your initial enrollment window for Parts B and D. Rather, it's the six-month period that starts after you're at least 65 years old and enrolled in Part B.

If you wait too long to enroll in a Medigap plan, you risk being denied coverage. You also risk having to pay more for coverage if you sign up outside that initial window.

Medigap could pick up the tab for deductibles, coinsurance, and other costs you incur as a Medicare enrollee. It pays to explore your plan choices and see which makes the most sense, as benefits can vary from one plan to the next.

Some Medigap plans, for example, pay your Part B deductible, but others don't. And if you plan to travel a lot in retirement, pay attention to foreign coverage, as that can vary from plan to plan, too.

It's natural to be concerned with healthcare expenses at a time in life when they might rise. But if you're strategic with Medicare, you might succeed in reducing your costs and easing your financial stress in the process.

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