Know the Truth

Bren Sheriff
Bren Sheriff


Know the Truth

How many times have you heard,“What you don’t know can’t hurt you”? I’ve heard it more times than I can count. They say that if a statement is repeated often enough, people begin to accept it as truth. Well, I’m here to set the record straight. No matter how many times something is said, it does not make it so. And when it comes to retirement, what you don’t know can hurt you— especially financially.

A case in point is that many myths are treated as facts about Social Security and Medicare. My intent is to address some of these misconceptions to help retirees—and those nearing retirement—make decisions based on facts, not myths. Why? Because these two programs are the cornerstones of retirement security, yet they remain widely misunderstood. These myths don’t just cause confusion; they can lead to lost income, unnecessary penalties, and inadequate health-care planning.

Ten retirement myths you’ve probably heard—but shouldn’t believe.

Myth #1: Working while receiving Social Security means you permanently lose benefits.
If you collect Social Security before full retirement age and earn above the annual limit, some benefits may be temporarily withheld—but they are not lost. Once you reach full retirement age, your benefit is recalculated upward. Financial takeaway: you can work and receive your benefits after full retirement age without penalty.  Your earnings will not reduce benefits, allowing employment or consulting income to strengthen cash flow without penalty.

Myth #2: Medicare pays for long-term nursing home care.
Medicare is health insurance—once known as hospitalization insurance—not long-term care insurance. It covers hospitalization and short-term skilled care under strict conditions. Extended nursing home stays, assisted living, and custodial home care are not covered. These costs require personal funds, long-term care insurance, or Medicaid. That’s why health-care planning is critical.

Myth #3: Social Security is going broke, so planning around it is pointless.
Social Security has faced funding challenges, but payroll taxes continue to support benefits, and Congress has historically made adjustments rather than allowing collapse. One major change was raising the full retirement age from 65 to 67. Discussions about raising the full retirement age even further reflect the intent of Congress to strengthen the system—not abandon it.  Pray that “47” stays hands off.

Myth #4: You should claim Social Security as soon as you’re eligible.
Not necessarily. Delaying benefits up to age 70 can significantly increase lifetime income, especially for those with longevity or spousal considerations. Some say applying for early benefits at age 62 “evens out” over time. Do the math for your situation and decide accordingly.

Myth #5: Medicare covers everything once you turn 65.
Medicare premiums, deductibles, co-pays, and uncovered services add up quickly. Dental, vision, hearing aids, and long-term care are excluded. Without supplemental coverage, retirees often underestimate health-care costs—one of the largest retirement budget items, especially when health declines and care needs increase.

Myth #6: You are automatically enrolled in Medicare at age 65.
Automatic enrollment applies only if you are already receiving Social Security. Otherwise, you must actively enroll. Missing enrollment windows can result in lifelong premium surcharges—bureaucratic language for penalties. With Medicare eligibility at 65 and Social Security full retirement age 67, confusion—and penalties—are almost guaranteed to occur.

Myth #7: Medicare and Medicaid are basically the same.
They are not. Medicare is a federal, age-based insurance program. Medicaid is needs-based, with strict income and asset limits, administered by most states—it’s certainly true in Illinois. Confusing the two has caused many families to lose assets unnecessarily due to a lack of asset-protection planning.

Myth #8: Only married couples benefit from Social Security spousal or survivor rules.
Divorced individuals may qualify for spousal or survivor benefits if the marriage lasted at least 10 years and other conditions are met. Ignoring this can mean leaving money on the table.

Myth #9: If you’re still working, you should skip Medicare Part B.
This depends on whether your employer coverage is considered “creditable.” Skipping Part B without confirmation can trigger permanent penalties and coverage gaps. Employer benefits must be coordinated—not assumed.

Myth #10: Once you choose Medicare coverage, you can’t change it.
Medicare offers annual open enrollment from October 15 through December 7, along with special enrollment periods triggered by life events. Coverage choices are not permanent—but deadlines matter.

The Planning Bottom Line
Social Security and Medicare are not just government programs; they are financial tools. When understood and coordinated properly, they can increase lifetime income, reduce unnecessary costs, and protect independence. In retirement, myths are expensive. Good information is priceless. Never believe that what you don’t know can’t hurt you - know the truth…

My best to you and yours, 

Bren Sheriff, CSA

THIS WEEK’S QUIZ: What is the difference between “mandatory insurance” and “forced insurance,” and who requires each?

Answer to last week’s quiz: The most common reason family-owned businesses fail is the absence of a clear succession plan—both preparing the next generation to manage the business and putting legal documents in place to transfer ownership.

For Questions or Help: 773-817-0601 or basheriff1@gmail.com

Disclaimer: The illustrations presented in this column are not, nor are they intended to be, legal, financial, or any other licensed professional advice, you should contact the licensed professional of your choice for advice on your individual situation.



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