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Old 11-11-2018, 08:11 AM
2,810 posts, read 1,002,852 times
Reputation: 3256


Originally Posted by townshend View Post
Retiring at 62 is a luxury, not a necessity.

Though I had a well-paying full-time job, and had saved significantly for retirement, I didn't even think about retiring at 62, and the problem of healthcare cost was a major consideration.

As already pointed out, COBRA is limited in duration and not cheap. My (ex-)wife quit her job, and both of us were on COBRA for eighteen months. It was about $1,800 per month. Yes, that adds up to around 32,000 out of our savings.

There are two initial periods that can make or break your retirement: the five years before you retire, and the first five years after you retire. You may live till your mid-80s, or even longer. Your 401K is not over funded. Do you or your wife have a pension?

I encourage you to reconsider your plans. One of the best decisions one can make is to work longer. You can do it, but you will need to adjust your thinking. Once potential retirees get "retirement" in their thinking, it's hard to postpone it. I know; the same thing happened to me. I held on to one month before I turned 65.

Go into your retirement financially strong . . . you will never regret that decision. Postpone taking SS until at least full retirement age . . . and even longer if you can afford it (+8% per year for each year postponed, up to 70 for most of us).

Relief from the high cost of U.S. healthcare is not even on the table by either of the two political parties that dominate electoral politics, and members of both parties take money from healthcare insurance companies, hospitals, and Big Pharma. (I am all for free universal healthcare for all U.S. citizens, funded by the MIC budget, or call it Medicare for All, but so are two dozen others in the U.S. who opinions and votes don't count). One healthcare crisis, even one unanticipated by your careful and prudent planning and lifestyle, could torpedo your entire retirement. Murphy's law is called a law, for a reason.

For the meantime, hope for the best, but expect and prepare for the worst -- expensive U.S. healthcare.
I agree with most of what you stated but for some because of health reasons it may not be luxury. I agree that one needs to plan on it and save as much as you can, but not all are able to live past their 80s.
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Old 11-11-2018, 08:20 AM
1,289 posts, read 292,701 times
Reputation: 1536
Originally Posted by StealthRabbit View Post
Lots of discussion on this here.

non conventional solutions not yet in this thread:
1) Healthcare cost sharing networks - legal option to ACA / Private carrier ~ $300 / month / couple (the risk is NO insurance!, just trusting others to help (which they do))
2) Join 15m in medical tourism https://patientsbeyondborders.com/
3) Travel fulltime (travel insurance is CHEAP, but not desired as 'primary') BTDT
4) Move overseas to countries that are affordable or accept USA medical refugees.
5) Self insure (short time frame)
6) Get a PT job with benefits (Costco / Starbucks / ~ 10 others)
7) Private pay
8) Reduce MAGI and qualify for a ACA subsidy.
9) Don't worry... be happy (That does not always work out)
Good post that presents much to consider. Cheers!
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Old 11-11-2018, 08:55 AM
Location: AZ
672 posts, read 395,387 times
Reputation: 2776
Whatever you get, don’t assume your preferred doctor will accept it. Medicare folks find out a lot that they cannot get into a doctors practice with Medicare. Good luck in the insurance maze.
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Old 11-11-2018, 08:58 AM
Location: Sierra Nevada Land, CA
8,401 posts, read 9,148,021 times
Reputation: 13037
Originally Posted by Petunia 100 View Post
Did your state expand Medicaid? If yes, that may be your answer. Keep your eyes on the bouncing ACA ball between now and age 62.
With $200k in the bank the OP is not eligible for Medicaid
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Old 11-11-2018, 09:25 AM
12,014 posts, read 5,130,833 times
Reputation: 18779
Originally Posted by Bygeorge View Post
Whatever you get, donít assume your preferred doctor will accept it. Medicare folks find out a lot that they cannot get into a doctors practice with Medicare. Good luck in the insurance maze.
Having a preferred doctor is the least of many people's worries. It's all they can do not to go bankrupt if a major medical episode happens with a very high deductible and insurance companies that will only pay for a percentage of a hospital stay which will result in owing tens of thousands even with insurance. Sure, if you can afford an insurance that pays for everything with a modest deductible then you are very well off. Most people can't afford medical insurance payments that are as high or higher than their rent or mortgage payment nor should they have to.
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Old 11-11-2018, 10:11 AM
Location: Paranoid State
13,047 posts, read 10,445,912 times
Reputation: 15683
One of the "gotchas" of retiring early and buying an individual health insurance plan is interstate living. I was surprised.

I live in one state for about 5 months of the year, and another state for the rest of the year. I'm a resident of the latter for income tax purposes, and that is where I buy insurance.

When I'm in the former state (the 5 month state), my insurance will cover ER visits, but it does not cover any non-ER medical services. I was surprised. There quite literally is no plan available for purchase by an individual that covers out-of-state medical services. One insurance broker told me to buy two policies: one in each state. I looked into that, but it turns out that is against the rules. I was surprised.
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Old 11-11-2018, 10:29 AM
6,625 posts, read 3,752,330 times
Reputation: 13703
Originally Posted by murph1982 View Post
I am currently 55 years old and have 200k in my 401k. I contribute 20% of my take home pay for my 401k. I would like to retire with no debt when I am 62 but I have one big concern.
Can you please give options for health insurance if I do decide to retire at 62 with my wife?
I am confident we can live off of the 401k and social security. Our big concern is the health insurance.
Any help would be appreciated!
I did that. I'll tell you that you cannot underestimate the importance of health benefits, both as security in case you need it, and as cost.

Right now, there is the ACA, where a person can get a subsidy, if he qualifies. There is no way to know what will be available in seven years.

Just hope that you still have a choice at that age, and are not forced into retirement by a layoff. If that happens, you may not be able to get another job at that age, and almost certainly will not get the same pay and benefits you had...especially insurance.

Lastly, you may not realize it, but because of your age alone, the cost of individual health insurance for you will be quite high. Even if you're in excellent health. Insurance companies are currently allowed to charge triple premiums to older Americans. That is the only group they are allowed to discriminate against. And the state you live in matters, as well. If you move, be sure to check the cost of health insurance there. If it's an industrial area or one where there is a high morbid obesity rate, odds are the health insurance will be high cost. When that is the case, you also have fewer ins. cos. willing to sell there, and less competition also means higher rates.

When it gets closer to the time, you can see what's available and the cost. You can go to contract work or part time work to defray the cost of health insurance, and semi-retire. Or work out another plan. (Part time work will probably not provide benefits. In fact, even a new full time job at that age might not provide insurance for you, because it would cost the company a lot.)

I recommend you hang in there until age 65, so you can buy Medicare. You could even retire 6 months before, so you'd have to pay high rates for just a few months. It's not really much longer, and the financial benefit to you will be pretty good.

One final thought: Individual health ins. isn't like employer-provided insurance. Unless yu can afford the highest level policies, it won't be as good (high deductible, high co-insurance, narrow provider and drug lists). And if they deny a claim, you are powerless, since you are just one person (not a company behind you). I had the ACA for years and was able to use it for an exam only once because I couldn't find a doctor near me who would take it. I also had to give up my hormones, since they weren't covered. And that "free" exam? I was charged over $100 for it. Why? I don't know. Blue Cross said it was because "something" was in the medical records. I called the provider, who said there was nothing unusual in the records. Not worth fighting over. So much for that.

My deductible was at various time $4,500 to $6,500, at a cost over several years ranging from $560 to $1000/mo., for low level HMOs. That is really catastrophic coverage, but it's not priced like catastrophic coverage, which should be low cost. And there were few companies to choose from.

But odds are that the health care system will be different in 7 years, when you reach 62.

Last edited by bpollen; 11-11-2018 at 10:38 AM..
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Old 11-11-2018, 11:06 AM
Location: Columbia SC
8,979 posts, read 7,749,631 times
Reputation: 12182
Originally Posted by JOinGA View Post
I just turned 62 and retired a few months ago. It would not have been possible if I was not able to continue my medical coverage through my former employer at the employee rate until I turn 65. I lost the dental and vision insurance, but that coverage was not all that great anyway and those expenses will just be out of pocket going forward.
Same happened to my wife. She retired from the State of MA. She was in management and was 62 with 18 years. They offered an early retirement package to management (non-union). They would add 5 years so on paper she became 65 with 20 years. They kept her health insurance going until age 65 then they became her supplemental. I was 2 years younger and they did the same for me as I was a dependent on her plan. When she died (at age 76), they allowed me to keep the supplemental going for $45 per month.

She had an additional spiff. They hired her back at her pre-retirement income, 3 days a week, and paid her on a 1099. That was a good year.....LOL
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Old 11-11-2018, 11:14 AM
1,837 posts, read 789,202 times
Reputation: 3385
Originally Posted by Bygeorge View Post
Whatever you get, donít assume your preferred doctor will accept it. Medicare folks find out a lot that they cannot get into a doctors practice with Medicare. Good luck in the insurance maze.
Actually according to doctors we talked with medicare has become the gold plan. We thought like this as well until we talked with a doctor who lives in the neighborhood and our doctors. Both stated that no longer is medicare hated by doctors.
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Old 11-11-2018, 12:01 PM
Location: Central IL
15,245 posts, read 8,538,301 times
Reputation: 35677
Originally Posted by Unicorn hunter View Post
Sounds like you are 7 years away from this possibility....impossible to say what the situation for health insurance may be by then. We may have medicare for all, or no insurance for anyone below the age of 70! Right now, I am 63.5 and retired at 62. Got an ACA plan for $125 a month....so not too bad....but really, I don't see how anyone without a crystal ball can tell you what the future holds.
Wow - $125 not bad?! I pay triple that and I'm employed...with "good" benefits!
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