T minus 6 months and counting ....

[CardsFan]

Close to pulling the trigger, and I have several questions for this group.
First: Healthcare
I have been through too many Megacorps and private equity firms to keep track. But current retiree medical will be just under $1000 per month (for two). ACA plans are in this ballpark, excluding subsidies. Do not really want to micromanage income, and the company plan has lower deductibles and is BCBS, so available pretty much everywhere.

We will both be 60 at retirement, so we are looking at 5 years. Am I missing something? Seems like the company plan makes the most sense.

Other questions to follow!

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[rodi]

Assuming you are close to the subsidy cliff I can see not wanting to risk losing a subsidy. Also don't discount the value of a low deductible. In the end only you can decide which is right for you.

 

[pb4uski]

One angle to check into if you are in good health and the lowest cost bronze plan exceeds 8% of your income you can buy catastrophic coverage even though you are over 30. In our state, catastrophic coverage is about 40% less than a bronze plan (in part because insurance is not age rated in our state) so it might be different for you but is something to check into. Also, the cat policy is less than half of what my COBRA would have been.

Also, if you go ACA, be careful whether deductibles are stacked or aggregate. If they are aggregate, then you are better off to get separate policies for you and your spouse.

 

[Another Reader]

I don't think you are eligible for subsidies if you have a retiree medical plan available from your company. I'm close to your age and I took the retiree plan and never looked back. Much better coverage for a similar price.


The potential problem is the attractiveness to employers of dropping pre-Medicare retiree insurance. Shifting the pre-Medicare retirees into an exchange that offers plans similar to ACA is on the table at my former employer.

 

[CardsFan]

Thanks for the comments. The retiree plan is a one shot deal. Take it now, or lose it for good, so I think it makes sense to try it first. Can always change to ACA later. I think the lower deductibles will offset the subsidy savings, and I will have more flexibility for Roth conversions.

Next issue: How and when to give notice.

Per the employment contract, 30 days notice is required, so that is the minimum. Having been there 27 years, and having had very good relations with my current supervisor, I am tempted to give more, or even hint soon that a package would be welcome (though "package season" appears to be over).

There is the chance I will be asked to stay longer, or be offered a phased retirement working 3 days a week for while. Not yet sure how I will respond to these.

I have read many of the past threads on this topic, so I know the members here have ranged from 2 weeks to more than 6 months. Would anyone do it differently?

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[W2R]

Thanks for the comments. The retiree plan is a one shot deal. Take it now, or lose it for good, so I think it makes sense to try it first. Can always change to ACA later.

Yep. Sounds like the way to go, from what you are saying. In comparing with ACA coverage, if (as you say) costs are the same, and coverage is as good or better, then it sounds pretty good. In five years you'll be on Medicare and the ACA will be irrelevant for you anyway.

Next issue: How and when to give notice.

Per the employment contract, 30 days notice is required, so that is the minimum. Having been there 27 years, and having had very good relations with my current supervisor, I am tempted to give more, or even hint soon that a package would be welcome (though "package season" appears to be over).

There is the chance I will be asked to stay longer, or be offered a phased retirement working 3 days a week for while. Not yet sure how I will respond to these.

I have read many of the past threads on this topic, so I know the members here have ranged from 2 weeks to more than 6 months. Would anyone do it differently?

I gave 6 months' notice, but I was a federal employee with a lot of job security. I'd have been more cautious had I been working elsewhere.

 

[TimSF]

I was a law firm partner and gave 30 days notice to the firm, after checking privately with another partner to make sure he was able to take over some of my ongoing work. A relatively short notice period worked well for me. It would have been uncomfortable for me, and others, if I were to have lingered for several months after my partners knew I was exiting. Pulling the band-aid off quickly was the right approach for me.

 

[pb4uski]

I don't really recall how much notice I gave but it was probably a couple months since we got our bonuses in mid-September and my last day of work was just before Christmas and I'm sure it would hae been after my bonus check was deposited.

It was a good confluence of contracting to sell our house and not having any big long-term projects on my schedule. I'm not sure if I ever really gave them a formal resignation letter, I just agreed on a date with HR and informed the boss who was fine with anything HR and I agreed to. Initially, there were just a small group of 2-3 partners who knew and then it later started to dribble out to a wider audience.

 

[jim584672]

Something else to consider, King vs Burwell. You don't want to reject retiree medical and then find out your state has no subsidies since they didn't set up their own exchange. We will know in June.

 

[CardsFan]

I don't really recall how much notice I gave but it was probably a couple months since we got our bonuses in mid-September and my last day of work was just before Christmas and I'm sure it would hae been after my bonus check was deposited.

Bonus payout is kind of driving my timing as well. Annual payout end of February (this is the main driver), but we have a smaller retention bonus, paid out over several years, and that is paid in June. Finally, the retention bonus fully vests and is fully payable if you retire after 60. Hence, retiring right after I turn 60.
Frankly, none of these really impact our ability to retire, but I'll be darned if I am going to leave tens of thousands on the table for megacorp to pocket.

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[Mulligan]

One angle to check into if you are in good health and the lowest cost bronze plan exceeds 8% of your income you can buy catastrophic coverage even though you are over 30. In our state, catastrophic coverage is about 40% less than a bronze plan (in part because insurance is not age rated in our state) so it might be different for you but is something to check into. Also, the cat policy is less than half of what my COBRA would have been.

Also, if you go ACA, be careful whether deductibles are stacked or aggregate. If they are aggregate, then you are better off to get separate policies for you and your spouse.

I would have lost my HSA deduction if I went that route, losing 31 cents on the dollar. So I THINK going that route may not have helped me. The reason why I said think is because when I was having to make my decision there was no info or quotes available to me to compare a catastrophic plan, and the teles were saying that was for under 30. To have gotten a quote I think I would have had to show the legal document and threaten physical violence. Wasn't worth going to jail over, but I do hear they get good free healthcare there.


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[pb4uski]

That is certainly one downside of a cat policy, not being able to make HSA contributions anymore. I was close to deciding on a bronze policy only for that reason, but the 40% premium difference is a nice bene and my HSA balances are healthy enough now.