Social Security and Medicare:

What Gen X Needs to Know

Track #6 of the Rock-n-Roll Financial Literacy Series for Gen X
Featured Song: “Taxman” – The Beatles

Two Big Pillars of Retirement – Social Security and Medicare

Social Security and Medicare are like the rhythm section of your retirement band—steady, essential, and often misunderstood. Gen Xers are approaching the age where these programs matter, but many of us still feel like we are guessing.

Let’s clear the fog. This post is your backstage pass to understanding how Social Security and Medicare work—and how to make them work for you.

First, a Reality Check

You have probably heard the rumors:

• “Social Security will not be there for us.”
• “Medicare does not cover anything.”
• “We are on our own.”

Here is the truth: Social Security is not going away. Medicare is not useless. But neither is perfect. Gen X needs to understand the rules, the risks, and the strategies to make the most of both.

Social Security Basics for Gen X

What is Social Security?

Social Security is a government program that provides monthly income in retirement based on your work history and earnings. Social Security is a U.S. federal program that provides financial protection through retirement income, and others, funded by payroll taxes paid by workers and employers. Administered by the Social Security Administration, it offers payments to eligible individuals, including those who are retired, disabled, or have lost a family member. 

How it Works

Payroll taxes – While working, you and your employer each pay a percentage of your earnings into the Social Security system. 

Credits – You earn credits for this work, and you need a minimum number of credits to qualify for benefits. 

Funding future benefits – Your contributions, along with those of other workers, fund the benefits being paid to current recipients. 

Types of Benefits

Retirement Benefits – Monthly payments for workers who have reached a certain age and earned enough credits. 

Disability Benefits (SSDI) – Financial support for individuals who cannot work due to a severe disability. 

Survivor Benefits – Payments to surviving family members, such as spouses and children, of a deceased worker who paid into the system. 

Supplemental Security Income (SSI) – Provides financial assistance to low-income individuals who are 65 or older, or disabled, regardless of work history. 

You can access your information, estimate future benefits, and manage your account online at ssa.gov.

When You Can Claim

• Age 62: Earliest you can claim—but with reduced benefits
• Age 67: Full retirement age for anyone born in 1960 or later
• Age 70: Maximum benefit—about 24% more than at full retirement age

How It is Calculated

Your benefit is based on your highest 35 years of earnings. If you have gaps or low-income years, they can lower your average.

Strategy Tips

• Delay claiming if you can—your monthly check gets bigger
• Coordinate with your spouse (if applicable) for timing and survivor benefits
• Use catch-up contributions to boost your retirement savings so you can delay claiming

Can I Count on Social Security?

You can count on Social Security to be available. You CANNOT count on Social Security to fund your entire retirement. Social Security is designed only to replace 40% of your pre-retirement income. Even then, up to 85% of your benefits can be subject to income taxes.

Medicare Basics for Gen X

Wait – what does Social Security have to do with Medicare?

You begin receiving Medicare automatically at age 65 UNLESS you wait to start claiming Social Security until after you turn 65. If you do wait to get Social Security until after 65, your Medicare will not begin automatically. You have to sign up for it in this case.

What is Medicare?

Medicare is federal health insurance for people 65 and older. It is broken into parts:

ORIGINAL MEDICARE	MEDICARE ADVANTAGE
Includes hospital coverage (Part A) + medical coverage (Part B)	Combines hospital coverage (Part A) + medical coverage (Part B), + additional health benefits under one plan
Does not provide prescription drug coverage	Often includes prescription drug coverage
Does not provide additional health benefits	Can include additional health benefits – dental, vision, hearing, fitness
Provided by the federal government	Provided by private insurance companies with varying benefits, costs and coverage options based on location and provider

When You Enroll

• Initial Enrollment: Starts 3 months before you turn 65
• Late Enrollment Penalties: If you miss the window, you may pay more forever
• Medigap: Optional supplemental insurance to cover what Medicare does not

Strategy Tips

• Know what is covered—and what is not (dental, vision, long-term care = not covered)
• Compare Medicare Advantage vs. Original Medicare + Medigap
• Budget for premiums, deductibles, and out-of-pocket costs

Common Myths (and the Truth)

Myth: Social Security will be gone by the time I retire

Truth: It is not going bankrupt. Even if the trust fund runs low, payroll taxes will still fund 75–80% of benefits.

Myth: Medicare is free

Truth: Part A is usually free, but Parts B, C, and D have premiums, deductibles, and copays.

Myth: I should claim Social Security as soon as I am eligible

Truth: Waiting can significantly increase your monthly benefit.

Tools That Do Not Suck

• SSA.gov – Estimate your Social Security benefits
• Medicare.gov – Compare plans and costs
• SmartAsset Retirement Calculator – See how Social Security fits into your plan
• The Gen X Money Checkup – Full Edition – a fast, friction-free way to get clarity on your finances without the shame or jargon. It is built for Gen X, if you want to take the mic back from your money and live louder.

Quick Wins to Get Ahead

• Create a mySocialSecurity account and review your earnings history
• Estimate your monthly benefit at different claiming ages
• Learn your Medicare enrollment timeline and options
• Budget for healthcare costs in retirement
• Talk to a financial advisor about coordinating Social Security with other income

Let’s Talk About It

Drop me a line and tell me:

• What is your biggest question about Social Security or Medicare?
• What is one myth you believed for way too long?
• What is your plan for healthcare in retirement?

Let’s swap stories, bust myths, and build something better—together.

Final Encore: Do not Let Confusion Cost You

Gen X does not need another lecture. We need clarity and strategy. We need to understand how Social Security and Medicare fit into our retirement remix.

GRAB YOUR CHECKUP. Learn the rules. And start building a retirement that feels like freedom—not fear.

Because retirement is not an age—it is an era.
And Gen X? We are ready to make it slap.

Bonus Track: Money Moves Playlist

This week’s vibe:
“Taxman” – The Beatles
Because understanding the system is the first step to playing it like a pro.

Until next time,

You say you want a revolution? Well, you know… we all want to change the world.

Tia

**Usually, I ask you to leave a comment for me after a post. Due to, probably, my technological illiteracy, I have been unable to access the comments you post. If I have not responded to one of your comments, this is why and I apologize. Until I resolve this issue, please email your comments to me at retirementrockstars66@gmail.com. I REALLY would love to hear from you. And I will respond.