Would like opinions on the following short term plan for health insurance after I retire. Assumption is we can't get insurance on our own.
When I hopefully retire at 54, I will have 12 years (split evenly 6 yrs each for wife and I) of free retiree insurance available and this can be delayed for up to 5 years. Employer also allows retirees to remain on employer plan at full cost after retiree insurance benefits are over.
I was thinking that it would be financially beneficial to take the delay option, since the value (to me) of the insurance would be more if I took the retiree years from age 59-65, rather than right away from age 54-60. I would be student from 54-59 and take free retiree coverage from 59-65, rather than taking free retiree coverage from 54-60 and pay full cost of employer insurance from 60-65.
So then we would have to find insurance duing those first 5 years. Without having to work at a part-time job enough to get insurance that way, I have found that a local state university offers student insurance for those taking just 3 credits/semester. Though requirement to pass, I would as that's one of my goals is to go back to school. Anyway, while this insurance is somewhat limited ($100,000/year benefits), it is just for the 5 years and with the cost of 4 classes/year (if wife and I each take 2/year to each qualify on our own), other fees, and insurance itself, it's only about $7,500/year - compared to close to about $25,000 for employer's if we paid for that beginning at 60.
Anyway, this 5 year student plan saves us a fair chunk of money to say the least. I know the down side is that insurance coverage is not the greatest but chances are probably wouldn't need in mid 50s and if there was an emergency that better coverage was needed, have option to begin employer's free retiree coverage at any time during those 5 years, regardless of health status.
I say it's worth a chance. What say you?
When I hopefully retire at 54, I will have 12 years (split evenly 6 yrs each for wife and I) of free retiree insurance available and this can be delayed for up to 5 years. Employer also allows retirees to remain on employer plan at full cost after retiree insurance benefits are over.
I was thinking that it would be financially beneficial to take the delay option, since the value (to me) of the insurance would be more if I took the retiree years from age 59-65, rather than right away from age 54-60. I would be student from 54-59 and take free retiree coverage from 59-65, rather than taking free retiree coverage from 54-60 and pay full cost of employer insurance from 60-65.
So then we would have to find insurance duing those first 5 years. Without having to work at a part-time job enough to get insurance that way, I have found that a local state university offers student insurance for those taking just 3 credits/semester. Though requirement to pass, I would as that's one of my goals is to go back to school. Anyway, while this insurance is somewhat limited ($100,000/year benefits), it is just for the 5 years and with the cost of 4 classes/year (if wife and I each take 2/year to each qualify on our own), other fees, and insurance itself, it's only about $7,500/year - compared to close to about $25,000 for employer's if we paid for that beginning at 60.
Anyway, this 5 year student plan saves us a fair chunk of money to say the least. I know the down side is that insurance coverage is not the greatest but chances are probably wouldn't need in mid 50s and if there was an emergency that better coverage was needed, have option to begin employer's free retiree coverage at any time during those 5 years, regardless of health status.
I say it's worth a chance. What say you?