Unlocking Retirement Wealth: How to Beat IRMAA & Maximize Social Security Benefits
Retirement should be a season of life to enjoy the wealth you’ve worked hard to accumulate. Yet, hidden rules—like IRMAA and Social Security timing—can quietly erode your expected income if you don’t plan ahead. Learn how to keep your wealth working for you using proven, compliant strategies.
What Is IRMAA, and Why Should Professionals Care?
For retirees with higher lifetime earnings or large account balances, IRMAA (“Income Related Monthly Adjustment Amount”) acts as a stealth tax, raising your Medicare Part B and D premiums. This can erode even the best-planned retirement, especially for physicians, business owners, and high-earning couples.
How IRMAA Works:
IRMAA surcharges are based on your MAGI from two years prior—often before you even retire. If you make a large Roth conversion, sell a business, or cash out stock in one year, you may pay higher Medicare costs for up to two years.
The Good News: With the right advance planning, IRMAA can be predicted—and legally minimized.
Social Security Timing: A Six-Figure Decision
Deciding when to claim Social Security might be your biggest retirement “raise.” Claim early (62) and your check drops permanently. Wait until 70 and you receive 8% more each year past FRA, for life. For couples, coordinating claims and understanding survivor benefits can add up to $100k or more in combined lifetime income.
4 Proven Strategies to Slash IRMAA and Boost SS Benefits
- Perform Roth Conversions Gradually Pre-Retirement
Start in your lower-income years, or after you retire and before you claim Social Security or start RMDs. This minimizes both taxes and IRMAA risk. - Use Tax-Free Withdrawals (TFRA, Life Insurance, HSA)
Since IRMAA is based on MAGI, withdrawals from TFRAs or HSAs don’t count—these sources create true tax-free retirement income. - Optimize Spousal Claiming
Higher earner delays—lower earner claims early: this combo lets couples receive some benefits earlier while maximizing the survivor benefit. - Leverage Qualified Charitable Distributions
Taking RMDs? Send part directly to charity—reduces income, supports your favorite causes, and may drop you below IRMAA brackets.
Case Example: The Physician Couple’s Wi
Dr. Kate (age 63) and her husband wanted to retire in two years. With $1.8M in IRAs and planned consulting, they risked paying the IRMAA surcharge until age 70+. We created a staged Roth conversion plan and coordinated their Social Security claims. Their IRMAA costs dropped by over $4,000 per year, and they gained $56,000 in additional, tax-advantaged Social Security.
Conclusion
Optimal retirement isn’t about guessing—it’s about strategizing. Beat IRMAA, maximize Social Security, and get the long-term income you deserve.
Get your personalized IRMAA & Social Security review today
Niche Client Story: “Beating IRMAA: The Medical Couple’s Winning Retirement Strategy”
Jessica, a 64-year-old pediatrician, and her husband Mike, a 66-year-old business consultant, were preparing to slow down and travel. They were blindsided by a letter: their Medicare premiums were set to jump dramatically due to IRMAA.
Their Challenge:
- Jessica had large IRA balances after years of maxing out retirement plans.
- Mike’s part-time consulting bumped their MAGI over $250,000 two years running.
- They wanted to begin Social Security, but worried about losing out on benefits and paying high Medicare premiums indefinitely.
How Rigel Blue Star Financial Helped:
- Created a two-year Roth conversion plan, spreading out tax and income.
- Recommended Mike claim Social Security at FRA (Full Retirement Age) for early income, while Jessica waited until 68, maximizing the couple's total benefit.
- Used a portion of after-tax savings to fund a Tax-Free Retirement Account, creating income that didn’t tally towards their IRMAA.
- Coordinated several large charitable gifts with Required Minimum Distributions (RMDs), further reducing taxable income.
End Result:
Jessica and Mike cut projected IRMAA surcharges by $3,000/year, added $45,000 in lifetime projected Social Security benefits, and felt secure in their retirement travel plans, knowing their income streams and Medicare premiums were predictable.
Compliance Note:
All projections and recommendations presented are for illustration purposes only. Results will vary on a case-by-case basis. Plan should be coordinated with your CPA, and tailored for your real tax and legal scenario.