So you’re ready to sock away half your income, earn more through side hustles and aggressively invest so you can become financially independent and retire before age 50.
But a big obstacle threatens to keep you from joining the financial independence/retire early movement, popularly known as FIRE: the high costs of health care and health insurance.
Without a job and too young for Medicare, what health care insurance options remain for early retirees and their family?
A handful, it turns out.
“There are already tens of millions that provide their own health insurance whether they’re retired, freelancers or independent contractors,” says Leif Dahleen, 43, author of the blog Physician on FIRE and an anesthesiologist by trade. “It’s not any different. You just put it in your budget.”
Dahleen is a member of the FIRE movement. He and other adhereents laid out the following health coverage options if you’re planning to retire early.
Private market
You don’t need an employer to buy health coverage straight from an insurer. In some cases, if you have a side gig that you incorporate, you may be able to write off some of health care insurance costs as a business expense, says Sam Dogen, founder of the blog Financial Samurai who has been financially independent since 2012.
Considerations: It’s costly. Dogen, 41, pays $1,760 a month, or $21,120 a year, out of pocket for a platinum plan for his family of three. They could have saved $100 to $200 a month by opting for a bronze or silver plan, but the cost would still total more than $1,500 a month.
“It’s an absurd amount of money,” Dogen says. “Either way you cut it, paying for unsubsidized healthcare is extremely expensive in America.”
Bare-bones plans
New rules created under the Trump administration allow insurers to sell short-term policies – up to 364 days – that exclude the minimum benefits that the Affordable Care Act plans must provide, such as prescription drugs, maternity and mental health care.
