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hardest part of "early retirement"

March 20th, 2016 at 09:01 pm

I think of this year as more of a sabbatical for us than early retirement. We certainly don't have enough to retire now based on where we want to live. We might if we moved somewhere else. We might if we were heavy into real estate investing. But honestly that was never the plan. The plan was always to move and change careers and have a fresh start. Early retirement is probably still in the cards, I'll know more in 12 more weeks, but the move did hurt us financially but at the same time I think it'll pay dividends in our lifestyle.

But the hardest part of the test? The health insurance. First time in our adult lives we've been on our own plan. We've always had employer provided coverage and it's been generous. We've always not worried about what was and wasn't covered. Perhaps it wasn't clear but we had a "general" idea and felt entitled to call and ask.

Now? Well now we buy our own insurance, for which I am eternally grateful that we can even buy it. If not for Obamacare my DH would be uninsured and my kids would have pre-exisiting conditions of asthma and allergies. I would likely be on the fence as to weather I'd be insurable and I'd have a maternity rider probably and be very expensive. As it is we are on a HDHP of $6500 per person and $13k per family deductible health insurance plan. This plan basically covers catastrophic incidents but everything else we self-insure. It still costs us $700/month just to cover ourselves. We don't have dental insurance or vision.

Fortunately for us we've been knock on wood extremely healthy so far during our tenure. My DK have seen the dr for a flu shot and annual exam. They've gone to the dentist once in November and we paid OOP for that and refused x-rays but it still cost us $200/per kid. And an office visit has been $150. We also had an ER visit for stitches (DK1 head hit a post and needed 4 stitches) but I'm unsure as of yet the cost, I assume $500, waiting for my bill in the mail.

I've been to the dentist for the cost of $300 for cleaning and x-rays they insisted. My DH got in under the gun in August and has decided he won't go until he gets a job since once a year according to his last dentist was more than enough. He's got perfect teeth with no cavities or problems. Both of us did annual exams over the summer before moving and now we're about to come due.

What I really need is more birth control. I hate the idea of paying and am considering actually planned parenthood. Truth is that I had filled all our prescriptions for multiple 3 month refills before we lost our prescription coverage for both birth control and asthma. If we had to cover it now the asthma inhalers it would be $200 a month. Fortunately before we lost prescription coverage it was $20/month.

So while our monthly spending is pretty curbed right now I think the biggest factor in "early retirement" is the difficulties not having health insurance as a group plan. Being covered by an employer makes the plans much more reasonable and better coverage than can be bought as an individual.

Right now it looks like DH will be done at the end of April. He'll take sometime to pick a job but will likely start we're thinking July 2016. Basically we'll have gone a 10 months without employer provided health insurance or a paycheck. This experience has definitely made it eye opening how much money we'd need to retire early. Of course the plan was always to be Financial Independent by age 50 and retire by 55. Now I'm not so sure if we would want to do that. I'm worried that at 55 we might have enough to "retire" but what happens if we're back on this crappy health insurance? And worried about more prescriptions or ailments that come with age?

This experience has definitely brought to the forefront the idea that its not easy to retire early. Mr Money Mustaches buys his own health insurance now for $237/month for a family of 3. I can't speak for why it's so cheap but I will say that we're a healthy family of four and it's costing us $700/month for a plan that has higher deductible levels. So there is a lot of variance in "needs" when budgeting for early retirement. Plus his annual medical spending appears to be much lower than ours.

10 Responses to “hardest part of "early retirement"”

  1. Carol Says:

    We paid about $1000 a month when we were insuring the two of us before Medicare a n d before ACA came into being. We also had the experience of some out of the blue health problems early in retirement. So yes,I agree, health insurance is a big factor in early retirement.

  2. jokeabee Says:

    Under the ACA, filling birth control prescriptions should be free (it may depend on the type of birth control you're using). You'd just need to get the prescription. I am a long time user of Planned Parenthood and, at least where I am, the exam for the prescription is about $100.

  3. VS_ozgirl Says:

    Mr Money Mustache is Canadian, could their healthcare / health insurance be different?

  4. PatientSaver Says:

    Dentists always try to insist in the importance of x-rays but that's becus they have purchased expensive x-ray machines that don't earn their keep unless they're used. Look up the American Dental Association guidelines for x-rays, which have been revised. You'll see that unless you have underlying problems, x-rays should NOT be "routine" on every visit. Then watch the surprised look on their face the next time you go in and ask them if they're familiar with ADA guidelines. I think they'll back off then.

    That being said, I consider cleanings every 6 mths to be cheap insurance against dental problems down the road, and I personally would not want to let it go for an entire year. There are surely other areas to save money.

    I agree that future healthcare costs is a big cost to consider. I, too, planned in my 30s to retire by 55, but that just wasn't possible after one too many layoffs and lateral job switches.

  5. Frank Facts Says:

    Opposition to Obamacare always bothers me, simply because it's so ideological. I'm not a very political person. The fact is, Obamacare isn't a huge burden on U.S. tax payers, but it financially helps REAL people in tangible ways. So unfortunate that the opposition is about irrelevant and purely theoretical concepts like "government takeover," "big government," etc.

  6. livingalmostlarge Says:

    Carol, I can agree it's hard to predict unexpected medical expenses.

    jokeabee it's more going to the dr and worried about the cost. I know BC is fere.

    VS Mr M lives in colorado. He is orginally from california.

    PS thanks I'll check out the ADA recommendations.

    Frank Obamacare is better than nothing.

  7. FrugalTexan75 Says:

    LAL - MMM is actually originally from Canada, but does live in CO now. Smile
    I wonder about healthcare costs too. My employer plan is pretty good, especially when I compare it against the plan Mr FT is on now (and was on last year.) Much lower out of pocket, and premium costs.

  8. LivingAlmostLarge Says:

    Yes Toronto. Oops autocorrect. His plan is $237 or something like that a month but it is HDHP. He does use the HSA but truthfully everything is OOP and he doesn't have any reoccurring expenses or medical conditions. For us it would be preexisiting conditions that would have done us in. DH would never have been insurable without obamacare and neither would my DK1 and potentially DK2

  9. snafu Says:

    I'm late to this discussion but surely you all know the rest of the developed world is astounded that the USA doesn't recognize universal health care as a right. Can it be that the major health insurance company lobbyists have done such an effective job that f-e-a-r replaced common sense? I never hear the same arguments about universal auto insurance which effectively competes for your business.

    If MMM still lived in TO, he'd not pay medical insurance premiums but he'd pay more per gallon for gas, a higher percentage of earned income for tax, a few cents to a long list of products VAT [value added tax] all to pay for all necessary medical treatment on the 'allowable' list decreed by College of Surgeons and Physicians for all citizens and eligible residents.

  10. LivingAlmostLarge Says:

    Snafu, nope the US a lot of people are afraid of taxes. But those who are in the "high" wage earner bracket pay as much taxes as many in Canada. Those who are super rich don't pay as much taxes as people who make a good living but still have to work. Like Warren Buffet said he pays less than his secretary % wise but not $ wise. He pays 15% of his annual income but it's millions. She'll pay 28% of her income but it's less $$$$. He challenged a room full of millionaires/billionaires to prove they pay more % than the VP working for them. No one won that bet.

    That being said I am for universal healthcare because I do believe it is a right. It is a big reason why I support Bernie. But many in the US don't until they hit 65 and medicare kicks in and then you can't "take" away medicare!!!!! the biggest proponent of socialized medicine!

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