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Old 07-28-2013, 12:34 AM   #101
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Have you gotten quotes?

I've received quotes for continuing my current coverage - family of 4, husband in his 60's (so expensive)... It's less than $1200/month. But this is an HMO... not a cadilac plan.
My HI numbers use projected ACA premiums, deductibles, and assume we hit the OOP max every 3 years. For post age 65 I'm using the Fidelity study. I hope I will spend less than these amounts, but for FIRE purposes I feel I need to be conservative. I can always redeploy the unspent funds towards travel if it turns out my estimates were too high
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Old 07-28-2013, 10:34 AM   #102
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Aren't Health Care cost going to go down when ACA kicks in? All things being equal that is. Plan x now and Plan X after 2014. Not including high deductible cheaper premium plans. I think those who are against it try to convince themselves and others that it will do the reverse.

In our case, we have about 60% of our retirement nest egg in Post Tax Money and the other 40% in qualified IRA or 457b vehicles. I am 60 and DW is 55. We plan on earning the minimum to qualify for subsidies (Unless Florida gives in and expands Medicaid). What I mean here is we can control how much our after tax (AGI) income is, and if we manage it correctly we can get the max subsidy for the Silver plan, although I will probably eat a little ad go with the Gold or Platinum in reality.

All this being said, home paid for, 30k coming from Post Tax and 20k coming from Pre-Tax funds, We can live pretty well. Home is paid for of course.

My only weakness is a new car every couple or 3 years, that again being said, I lease and pay the whole lease payment in one go this saving quite a bot and not having car payments for the duration. I am currently evaluating diesel cars and find this a good way to test drive them. My current car an E350 Bluetech diesel, I would NEVER have bought for ~$70k but only paid $10k up front for a 2 year test drive. I would have lost far more than that in depreciation if I bought it. Why I bring this up is my costs are increased by about $5k per year for the Lease, but we could still live well on $4k - $5k per month.

Translate this in to raw math. Let us say the average EARLY retiree who has planned well has $1.5m saved, assuming Zero return this would last for about 30 years. Add to that the return SS etc. and other returns $1m would probably do the same job.
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Old 07-28-2013, 02:33 PM   #103
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Aren't Health Care cost going to go down when ACA kicks in? All things being equal that is. Plan x now and Plan X after 2014. Not including high deductible cheaper premium plans. I think those who are against it try to convince themselves and others that it will do the reverse.

In our case, we have about 60% of our retirement nest egg in Post Tax Money and the other 40% in qualified IRA or 457b vehicles. I am 60 and DW is 55. We plan on earning the minimum to qualify for subsidies (Unless Florida gives in and expands Medicaid). What I mean here is we can control how much our after tax (AGI) income is, and if we manage it correctly we can get the max subsidy for the Silver plan, although I will probably eat a little ad go with the Gold or Platinum in reality.

All this being said, home paid for, 30k coming from Post Tax and 20k coming from Pre-Tax funds, We can live pretty well. Home is paid for of course.

My only weakness is a new car every couple or 3 years, that again being said, I lease and pay the whole lease payment in one go this saving quite a bot and not having car payments for the duration. I am currently evaluating diesel cars and find this a good way to test drive them. My current car an E350 Bluetech diesel, I would NEVER have bought for ~$70k but only paid $10k up front for a 2 year test drive. I would have lost far more than that in depreciation if I bought it. Why I bring this up is my costs are increased by about $5k per year for the Lease, but we could still live well on $4k - $5k per month.

Translate this in to raw math. Let us say the average EARLY retiree who has planned well has $1.5m saved, assuming Zero return this would last for about 30 years. Add to that the return SS etc. and other returns $1m would probably do the same job.
How do you lease a 70k car for 2 years for 10k. Like you said that's way more than the depreciation on the car. Who,offers such a deal?
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Old 07-28-2013, 02:56 PM   #104
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How do you lease a 70k car for 2 years for 10k. Like you said that's way more than the depreciation on the car. Who,offers such a deal?
I agree, but that is what I paid! I purchased the last one on the lot at the end of September 2012. I basically got the last one in my area. Black Black, diesel. I did pay it all in one lump sum and saved a payment or 2, but I do have a $595 return fee if I do not lease or buy another MB. It was a Zero % Interest deal I remember that. So I guess $11k would be closer if I rounded it up. In addition, I put the whole thing on my AMEX and got 2% back. AND what is even better is I was working last year in sales, and wrote the whole amount off as a 1 time payment. So it actually probably really cost me about ~8k.

It had ~450 miles when I got it so it could have been a demo. I have learnt over the years that buying at the end of the model year at the end of the month, gets the best deal.

I just looked at the window sticker and it say $67,435. (OK So I rounded it to $70k)
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Old 07-28-2013, 03:07 PM   #105
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We plan on earning the minimum to qualify for subsidies (Unless Florida gives in and expands Medicaid).
Has it been concluded by the lawmakers that if Florida does not expand Medicaid you can buy into the exchanges with a subsidy? There is information that if a state does not participate in Medicaid you can buy into an exchange but no subsidies will be offered. Not sure which is the case.
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Old 07-28-2013, 03:22 PM   #106
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Has it been concluded by the lawmakers that if Florida does not expand Medicaid you can buy into the exchanges with a subsidy? There is information that if a state does not participate in Medicaid you can buy into an exchange but no subsidies will be offered. Not sure which is the case.
The way I understand it, and I could be wrong, is that there will be subsidies up to the poverty level, when Medicaid kicks in. You can go to the guestimators and look.

I use $21,300 as an estimate for 2 non smoking adults 60 and 55, and total subsidy is $14,586, total premium for couple will be $705 (PA) which is 2% of income.

Here is the warning they posted:

If your state expands Medicaid

If your state chooses to expand Medicaid to everyone under 138% of the poverty level under the ACA, you will be eligible for coverage under the program. Medicaid coverage varies from state to state, but out-of-pocket costs are generally modest. Smoking status is not taken into account in Medicaid eligibility.

If you enter a number below the Poverty level (~$15,000) this is what it says:

If your state does not expand Medicaid

You will not be eligible for subsidies in the exchanges because your income is below 100% of the federal poverty level.
The information below is about unsubsidized exchange coverage. Note that depending on your state's eligibility requirements, you may still be eligible for coverage through Medicaid.


Again, we will see when the time comes as I am sure we all interpret differently.

Florida is umming and ahhhring at the moment as there is a lot of pressure to comply. Rick Scott is getting soft on the subject I think.

As far as repealing ACA, what person in their right mind would want to try to do that once, let alone 38 or so times? Unless of course they were getting campaign funds form insurance companies.
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Old 07-28-2013, 04:47 PM   #107
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Originally Posted by ShokWaveRider View Post

The way I understand it, and I could be wrong, is that there will be subsidies up to the poverty level, when Medicaid kicks in. You can go to the guestimators and look.

I use $21,300 as an estimate for 2 non smoking adults 60 and 55, and total subsidy is $14,586, total premium for couple will be $705 (PA) which is 2% of income.

Here is the warning they posted:

If your state expands Medicaid

If your state chooses to expand Medicaid to everyone under 138% of the poverty level under the ACA, you will be eligible for coverage under the program. Medicaid coverage varies from state to state, but out-of-pocket costs are generally modest. Smoking status is not taken into account in Medicaid eligibility.

If you enter a number below the Poverty level (~$15,000) this is what it says:

If your state does not expand Medicaid

You will not be eligible for subsidies in the exchanges because your income is below 100% of the federal poverty level.
The information below is about unsubsidized exchange coverage. Note that depending on your state's eligibility requirements, you may still be eligible for coverage through Medicaid.

Again, we will see when the time comes as I am sure we all interpret differently.

Florida is umming and ahhhring at the moment as there is a lot of pressure to comply. Rick Scott is getting soft on the subject I think.

As far as repealing ACA, what person in their right mind would want to try to do that once, let alone 38 or so times? Unless of course they were getting campaign funds form insurance companies.
Latest info I got was from a good source but it differs from the previous info I got from the same company.

Florida was in the Medicaid program earlier this year now they are out. Another meeting is supposed to take place later this year.

As of now if your 2012 income is below 138% you are eligible for Medicaid.

If Florida expands you have Medicaid and do not have any option to buy into an exchange.
Income below 100% poverty gets 100% subsidy.
Over 100% under 138% subsidy about 98%.

If Florida does not expand the under 138% Medicare eligible participants will get the option to buy into the exchanges since their
state is not offering the Medicaid.
They will not receive subsidies in these exchanges.

Politics

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Old 07-29-2013, 05:15 AM   #108
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I get no tax preferential treatment on the HSA as a retiree. It is not tax deductible.

Health insurance premium of an early retiree is not tax deductible...
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Originally Posted by Mulligan View Post
Interesting. I am retired and only draw a pension. Even though it is not considered "earned income", I still get the tax deduction from my HSA, as I have a self directed one...
I have another correction to make. I looked at my past tax return, and HSA contribution has always been tax deductible. The premium, on the other hand, is deductible only for the self-employed.

The above items are right on page 1 of the long form. My memory is getting worse, it scares me. Well, at least I still had a nagging doubt that perhaps I was wrong, so it's not Alzheimer, right?

There were some years when I did not get work as an independent (1099), but as a job shopper (W2). Those years, I did not get to deduct the premium because I was not classified as self-employed. It irked me about that tax law, but I remembered it wrong.
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Old 07-29-2013, 06:51 AM   #109
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Originally Posted by Refresher View Post
Latest info I got was from a good source but it differs from the previous info I got from the same company.

Florida was in the Medicaid program earlier this year now they are out. Another meeting is supposed to take place later this year.

As of now if your 2012 income is below 138% you are eligible for Medicaid.

If Florida expands you have Medicaid and do not have any option to buy into an exchange.
Income below 100% poverty gets 100% subsidy.
Over 100% under 138% subsidy about 98%.

If Florida does not expand the under 138% Medicare eligible participants will get the option to buy into the exchanges since their
state is not offering the Medicaid.
They will not receive subsidies in these exchanges.

Politics

I
D
Medicaid is available in Florida, but the state chose not to implement the expanded version. This was already decided and the Fl legislature is no longer in session, so there is no expectation that Medicaid eligibility will change this year. That means some adults will not qualify for any public healthcare program.
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Old 07-29-2013, 07:52 AM   #110
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I have another correction to make. I looked at my past tax return, and HSA contribution has always been tax deductible. The premium, on the other hand, is deductible only for the self-employed.

The above items are right on page 1 of the long form. My memory is getting worse, it scares me. Well, at least I still had a nagging doubt that perhaps I was wrong, so it's not Alzheimer, right?

There were some years when I did not get work as an independent (1099), but as a job shopper (W2). Those years, I did not get to deduct the premium because I was not classified as self-employed. It irked me about that tax law, but I remembered it wrong.
Well I guess you have yet another correction to make. Health insurance premiums are/have been deductible to the extent that they exceed 7.5% of AGI (it changes to 10% of AGI in 2013). If you're self employed, health insurance premiums are deductible from your self employment income subject to certain limitations.
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Old 07-29-2013, 08:18 AM   #111
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Originally Posted by NW-Bound View Post

I have another correction to make. I looked at my past tax return, and HSA contribution has always been tax deductible. The premium, on the other hand, is deductible only for the self-employed.

The above items are right on page 1 of the long form. My memory is getting worse, it scares me. Well, at least I still had a nagging doubt that perhaps I was wrong, so it's not Alzheimer, right?

There were some years when I did not get work as an independent (1099), but as a job shopper (W2). Those years, I did not get to deduct the premium because I was not classified as self-employed. It irked me about that tax law, but I remembered it wrong.
Well, it's ok to have forgotten since you did make the deduction and recovered credit for it. I wasn't wanting to push the issue, as I am not an expert, but I thought you had the standing to make the deduction, otherwise there really isn't a reason to fund an HSA without the initial tax break.
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Old 07-29-2013, 09:30 AM   #112
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Yes, I did claim the HSA, and also the premium the years I qualified as self-employed. Without self-employed earned income, the premium is practically not claimable due to the AGI limit, and then the standard deduction.

So, my pending Alzheimer aside, I do not see that I need to file any amended return, right?
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Old 07-29-2013, 11:51 AM   #113
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Sounds right to me. When I do my taxes I put in my premium and then TT calculates how much is deductible. Last year (my first full year retired and paying for my own health insurance) was the first year I got a deduction.
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Old 07-29-2013, 12:22 PM   #114
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Hi Brooks Saddle,
I just pulled our last six month budget. My DW and I could make it with a lot of room to spare. We can get by on a bit less than $3200 if I stop driving my 14 year old Land Cruiser (16 mpg) on long distance road trips. We live really well on this $3200.
We have spent the last ten years though, trying to downsize our life. We jokenly talk about how we now live exactly like we did when we were in grad school (slightly better beer now though). We also have our house paid off which removes a mortgage payment from our budget calculation. More and more seniors are entering retirement with a mortgage today than even ten years ago. I guess a lot of the monthly amount comes down to choices about how you want to live and how you want others to perceive your life.
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Old 07-30-2013, 08:45 AM   #115
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I was looking at our spending and it seems we're are averaging about $3500/month spending with a paid off townhome, that is for two of us with no kids.

Do most of you early retirees still keep two cars? I've always assumed we'd only need one and have planned to budget approx $200/month to replace it every six years.
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Old 07-30-2013, 08:48 AM   #116
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Do most of you early retirees still keep two cars? I've always assumed we'd only need one and have planned to budget approx $200/month to replace it every six years.
We got rid of the 2nd car the same month we ER'ed and have managed just fine with 1 car this last few years.
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Old 07-30-2013, 09:18 AM   #117
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I'll retire in 4 months and will have to live on $5700 (b4 taxes) as I only have my pension. But I have lifetime medical, thankfully and I am grateful for it. Still, the first year will be tough as I'm moving, setting up a new household and paying off some residual debt and adding to my emergency savings. I'm single and live a fairly simply life. Except for food, both in and dining out. I love to cook and plan on doing much, much more of that. In fact, I'll be taking some classes at a Cordon Bleu cooking school for fun.

If I can't live on that amount of money then something is wrong with me!
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Old 07-30-2013, 09:25 AM   #118
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Long term care insurance was expensive to purchase when I was smart enough to think about it as its based on age. I'll have my pension and what pittance of soc sec I may get and that will narrow my choices considerably. I may have to move to make it work. Then again, I'm "planning" on dying in the saddle...or at my writing desk...or in the throes of passion...
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Old 07-30-2013, 09:38 AM   #119
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Then again, I'm "planning" on dying in the saddle...or at my writing desk...or in the throes of passion...
Plan carefully and pull of the trifecta. Place saddle at writing desk, have passion, and die.
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Old 07-30-2013, 10:27 AM   #120
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Do most of you early retirees still keep two cars? I've always assumed we'd only need one and have planned to budget approx $200/month to replace it every six years.
We still keep two vehicles. But we live on a rural area. Most of DH's destinations are west; most of the time I go north. It would be very inconvenient for us to have only one vehicle. Doable, but inconvenient. I imagine we will have two vehicles until we are on our late70's or so.
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