If you’re planning to retire early, you might be wondering what you’ll do for health insurance coverage. Medicare won’t kick in until you turn 65, and the rising cost of healthcare each year could translate to unknown monthly premiums and out of pocket costs. This leaves you in a precarious situation if you don’t have another form of benefits.
Fortunately, the Affordable Care Act includes several rules designed to limit your costs. For example, insurance companies may charge a 64 year old premiums of no more than three times those of a 21 year old. The ACA also outlaws rejecting applications or charging more for preexisting conditions, and limits out of pocket costs to $6700 per year.
I’m not taking a stance on Obamacare here, but if you’re looking to retire early the road to health coverage is easier now than it was a few years back. But despite the improvements, a major illness or injury could still take a big chunk out of your retirement savings. And as you probably know, the worst possible time to deplete your nest egg is immediately after you stop working.