When planning for retirement, most people account for housing, travel, daily living expenses and general healthcare costs. However, it's easy to overlook one retirement expense: the Income-Related Monthly Adjustment Amount, commonly known as IRMAA.
If you have a large pension, substantial tax-deferred retirement accounts, or other variables that may elevate your retirement income, IRMAA is a factor you may encounter starting in your mid-60s. While it is unlikely to derail a well-constructed financial plan, failing to understand IRMAA and how to plan ahead for it can lead to frustrating annual surprises.
In the United States, most adults become eligible for Medicare when they turn 65. Medicare is divided into several parts, but IRMAA specifically applies to two of them: Part B (which covers doctor visits, outpatient care and preventive services) and Part D (prescription drug coverage).
For the average retiree, Medicare Part B carries a standard monthly base premium ($202.90 per month in 2026). Part D coverage varies depending on the specific private plan selected, but carries a national average base premium of roughly $38.99 per month. Combined, a standard retiree pays roughly $242 per month for basic Part B and Part D coverage, per Medicare.
However, Medicare premiums are not one-size-fits-all. If your income exceeds specific threshold limits set by the federal government, you will be required to pay an additional surcharge on top of your base monthly premiums. That additional surcharge is IRMAA.
#income #base
If you have a large pension, substantial tax-deferred retirement accounts, or other variables that may elevate your retirement income, IRMAA is a factor you may encounter starting in your mid-60s. While it is unlikely to derail a well-constructed financial plan, failing to understand IRMAA and how to plan ahead for it can lead to frustrating annual surprises.
In the United States, most adults become eligible for Medicare when they turn 65. Medicare is divided into several parts, but IRMAA specifically applies to two of them: Part B (which covers doctor visits, outpatient care and preventive services) and Part D (prescription drug coverage).
For the average retiree, Medicare Part B carries a standard monthly base premium ($202.90 per month in 2026). Part D coverage varies depending on the specific private plan selected, but carries a national average base premium of roughly $38.99 per month. Combined, a standard retiree pays roughly $242 per month for basic Part B and Part D coverage, per Medicare.
However, Medicare premiums are not one-size-fits-all. If your income exceeds specific threshold limits set by the federal government, you will be required to pay an additional surcharge on top of your base monthly premiums. That additional surcharge is IRMAA.
#income #base
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