Can I Afford Health Insurance If I Retire before Taking Medicare?

Can I Afford Health Insurance If I Retire before Taking Medicare
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Health insurance is seen as a huge hurdle for early retirees, but the answer to finding affordable coverage could be simpler than you think.

Kiplinger’s recent article, “I Can’t Retire – I Need Health Insurance,” explains that you can begin collecting Social Security as young as 62 or as late as 70. But you can’t go on Medicare until you are 65. The gap between ages 62 and 65 makes many folks delay their retirement until they can go on Medicare to ensure adequate health insurance.

However, it doesn’t have to be the case.

In 2010, the Affordable Care Act (ACA) was passed and ensured all Americans had the right to health insurance. Now we have a much better understanding of the ACA and how it can benefit all of us, including those under 65.

People think that insurance coverage is terrible and expensive under the ACA. But that’s not true. The ACA has evolved to control how much coverage you want and need. Residents can learn about their options at or find information about their particular state’s program by visiting

But the cost of health insurance through the ACA does create confusion. This is another obstacle for retiring before 65 with no health care through your employer or your spouse’s employer. The monthly cost to you, the enrollee, is based on your expected household income for the year you need coverage. But here’s the good news: you may have little to no earned income when you retire.

For those who retire before 65, most of the money they live off first could be money in their checking/savings accounts or non-IRA money—their most liquid assets. If that’s the case, a low income could cause your premiums to be much lower than you anticipated when applying for health insurance.

Our health insurance through the ACA can be at a dramatically reduced cost – or maybe even free. In retirement, you can determine your sources of income. And this flexibility can help.

The enrollment process is simple. If you’re planning to retire, it’s considered a “life event,” qualifying you to apply and enroll at the time of retirement.

Reference: Kiplinger (Aug. 7, 2022) “I Can’t Retire – I Need Health Insurance”