My plan is working...

[Curmudgeon]

I'm going to look into the idea that I might be able to qualify for Obama Care by not "having any income" - which I won't, except for withdrawing from my savings and maybe from my 403b in order to make it the 1 1/2 years until Medicare. I'm wondering if the 403b counts as "income" for the purposes of Obama Care?

Unless it was a Roth 403b, then yes your withdrawals count as income. Any realized gains in your taxable accounts (savings, brokerage accounts, etc.) will also count as income.

 

[Scuba]

Love your post!!!!



Happy Thanksgiving lady.



I just got off my conference call with my Fidelity advisory service person. I will be 63 in March and plan to retire in 2 years from then at 65. Told her about the extreme pressure of my job and she says.......”You do realize you can quit today don’t you?” I moaned about paying horrible pricing for my own health insurance for 2 years and after years of saving and saving, the thought of withdrawing that money for two years without any income mentally bothers me.



She mentioned which would be worse....working for 2 more years, numerous reports, field rides with management, pressure, etc. or not working, playing tennis, being stress free by withdrawing money that was for this very purpose. She explained I can get Obama care cheaply by just withdrawing from our savings account, which is not considered income and not draw on SS and my annuity as planned until 65. This will show me as a low income to qualify for lower healthcare pricing. Out total annual expenses are about $60k and I have $300k just sitting in our checking account. At 65 our SS and annuity will cover all of our annual expenses.



I think I can deal with the withdrawals in this light.

Sounds like a very helpful FA. Congratulations!

 

[Curmudgeon]

I know I will get skewered for this but I will say again that getting health care subsidized by drawing on savings while having substantial assets goes against my grain. It's just another way Americans game the system as others pay their costs. I'm not against single payer but there should be financial means testing if we're going to keep this system. Sorry but this is just my opinion.

I hope this isn't interpreted as a skewer, but just a counterpoint:

I hate systems that penalize people who manage to save money. Take Alice and Bob, who both have the same job and make the same money, pay the same taxes, etc. Alice manages to save a substantial portion of her pay by LBYM, while Bob spends every dime he has on large screen TVs, expensive cars, vacations, etc. and ends up with zero savings. At retirement time, why does Bob deserve more benefits than Alice, simply because he chose to spend rather than save? Why is Alice suddenly considered a fatcat?

The OP's withdrawal from 403b will count as income - as it should, because this is money that was not taxed originally. But why penalize her for having savings to use as well? She's already paid taxes on those.

 

[CindyBlue]

I know I will get skewered for this but I will say again that getting health care subsidized by drawing on savings while having substantial assets goes against my grain. It's just another way Americans game the system as others pay their costs. I'm not against single payer but there should be financial means testing if we're going to keep this system. Sorry but this is just my opinion.

I'm fairly sure that if I were means tested, I wouldn't have "substantial assets" (grin!)
And I'm afraid I agree with Curmudgeon:
"I hate systems that penalize people who manage to save money. Take Alice and Bob, who both have the same job and make the same money, pay the same taxes, etc. Alice manages to save a substantial portion of her pay by LBYM, while Bob spends every dime he has on large screen TVs, expensive cars, vacations, etc. and ends up with zero savings. At retirement time, why does Bob deserve more benefits than Alice, simply because he chose to spend rather than save? Why is Alice suddenly considered a fact?"
My brother was that way...he didn't work much and spent everything he had - he was a "system gamer,", so he got free medical and lots of free services that I had to pay for through my taxes because I'm a worker and a saver. I've always known that I will have take care of my older sister in her old age, too...she is a hard worker but doesn't save anything. (I warned my hubby about both of them and my feelings of responsibility when we were first talking about getting married - thank goodness he still took me on! )
So while I see your point, I think it all evens out in the end, at least on my end, in my family, anyway (wry smile!)

 

[Bir48die]

I'm fairly sure that if I were means tested, I wouldn't have "substantial assets" (grin!)

And I'm afraid I agree with Curmudgeon:

"I hate systems that penalize people who manage to save money. Take Alice and Bob, who both have the same job and make the same money, pay the same taxes, etc. Alice manages to save a substantial portion of her pay by LBYM, while Bob spends every dime he has on large screen TVs, expensive cars, vacations, etc. and ends up with zero savings. At retirement time, why does Bob deserve more benefits than Alice, simply because he chose to spend rather than save? Why is Alice suddenly considered a fact?"

My brother was that way...he didn't work much and spent everything he had - he was a "system gamer,", so he got free medical and lots of free services that I had to pay for through my taxes because I'm a worker and a saver. I've always known that I will have take care of my older sister in her old age, too...she is a hard worker but doesn't save anything. (I warned my hubby about both of them and my feelings of responsibility when we were first talking about getting married - thank goodness he still took me on! )

So while I see your point, I think it all evens out in the end, at least on my end, in my family, anyway (wry smile!)

I saved money. Spent less than I could have. Retired early. Pay stupid amount for my insurance. I put in deferred comp. my wife has a pension. All counts in income where some of you it doesn't. So, let's say I pay $1,000/month for me where you pay $250 but same assets. <mod edit>

 

[CindyBlue]

I see your point, and respect your right to have your position and opinion.

 

[Floridatennisplayer]

I saved money. Spent less than I could have. Retired early. Pay stupid amount for my insurance. I put in deferred comp. my wife has a pension. All counts in income where some of you it doesn't. So, let's say I pay $1,000/month for me where you pay $250 but same assets. <mod edit>.

<mod edit> I’ve worked hard, payed a ton of taxes over 40 years, <mod edit>. And you want to penalize me for using my own money and not drawing SS that I also overpaid for my return!!!! <mod edit>.

 

[Ronstar]

Thanks for the healthy discussion. Unfortunately, the discussion has meandered into posts on the fairness of government policies, talk of social/economic classes, the morality of one's financial decisions, and mention of partisan politics. Therefor, the moderator team has closed the thread.