Hello! ER and HealthCare Issues

[giannaluna]

Hello,

I'm Gianna, in my early 50s and hoping to retire before age 60. Thanks for this forum!

I'm currently a civil servant, but don't have a long history in the service.
In about 5 years, I will be eligible for health care benefits in retirement.
My future in this position is shakey (I am not a good fit for the job) and I am interested in looking for positions in the private sector.

I am trying to gauge how much I would be giving up if I move to another job, for the next few years until retirement (will retire with a collection of income streams).

I understand health care benefits in retirement are valuable, but we pay a price for everything and with the new ACA, I am considering other options.

If someone here can point me in the direction of a thread or subforum here for discussing the healthcare issue, would greatly appreciate it!

Gianna

 

[W2R]

Hi Gianna, and welcome to the Early Retirement Forum.

Are you a federal employee? I was, and worked for two years after I was financially independent, in order to qualify for health insurance in retirement.

I am pretty glad that I did at that time. I guess now the Affordable Care Act (Obamacare, ACA) health insurance is available but it wasn't then; and to be honest I am glad I didn't have to deal with its website problems and other startup problems at that time that may or may not still be an issue.

Now that I am on Medicare, the ACA is sort of irrelevant for me. I know this seems like a long time in the future for you, though. Unfortunately the cost of federal health insurance (FEHB) does not go down when Medicare is started, even though Medicare is primary and FEHB is secondary. Still, the combination of FEHB and Medicare has been very nice. Other than the cost of Medicare Part B and FEHB, the only medical expense I have had in the nine months since I started Medicare, is for my share of the prescription cost.

 

[pb4uski]

The period of concern for you would be from when you ER at 60 to when you become eligible for Medicare at age 65.

You could get an idea of what you would be giving up based on today's health insurance premiums, co-pays and deductibles for a 60 year old compared to what they would be as a retired civil servant.

However, what it is today could change depending on what happens with future health insurance premiums under Obamacare, which is a big unknown.

 

[ERhoosier]

Agree 100% with W2R that sticking it out as a civil servant until you qualify for retiree health benefits is often a wise move. Private sector generally has been cutting retiree benefits so it would likely have to be a BIG pay increase to compensate. You might look up ACA health plan prices for 60 yo in your area to get an idea what monthly premiums (+ deductibles/OOP max) are, but don't forget to add in some inflation from now to age 60 (planned retirement age).
Affordable Care Act (Obamacare) Health Insurance Exchanges

 

[Options]

Hello,

I'm Gianna, in my early 50s and hoping to retire before age 60. Thanks for this forum!

I'm currently a civil servant, but don't have a long history in the service.
In about 5 years, I will be eligible for health care benefits in retirement.
My future in this position is shakey (I am not a good fit for the job) and I am interested in looking for positions in the private sector.

I am trying to gauge how much I would be giving up if I move to another job, for the next few years until retirement (will retire with a collection of income streams).

I understand health care benefits in retirement are valuable, but we pay a price for everything and with the new ACA, I am considering other options.

If someone here can point me in the direction of a thread or subforum here for discussing the healthcare issue, would greatly appreciate it!

Gianna

Hello Gianna. It's a bit more complicated than simply changing jobs and wondering about health care. Most important is job security. Once you get into your 50s, things get tricky. Statistics show people who lose their jobs after age 50 are unemployed longer, and once they are reemployed, only 1/3 make the same or greater salary than before. Additionally, the reason 62% of the workforce are looking for another job is because, like you, they are dissatisfied with their current job. Some things to consider before making the leap, if you choose to do so:

1) What do you do, and how long have you been doing it? Will you be able to compete in the job market, particularly given that there are 7 "qualified" applicants for every job paying over $15/hr (not to mention the literally 100s of other applicants who are unqualifed)?
2) Do you have a "stable" work history, as in working with more than one employer at least 5 years? If you work in a job that makes over $13.50 an hour, you'll have lots of competition. Over 70% of the jobs created after 2009 make less than $13.50/hr.
3) Did you work in the private sector before working as a civil servant? Getting a job in the private sector may be hard with no previous experience, even harder depending on your field.
4) Even if you do get another job, do you have plan B in case you land somewhere even worse than you are now (it happens)?
5) Is it possible to transfer to another position as a civil servant and thereby keep the possibility of health care benefits in retirement?

Just some rather sobering thoughts when considering a job change of any kind. Good news is you are close to ER, so not much longer to go!

 

[ERhoosier]

Agree with Options.
Logical & upfront presentation of some important issues to consider.

 

[giannaluna]

Thanks all for the feedback, much appreciated.

I would go back to work in the private sector now (much more marketable now that I have been on both sides) if not for the healthcare benefit in retirement.

I hear the concerns about re-employment, but I am not too concerned. Not to be arrogant, but my skill set is very solid in the job market I work in where there are now severe shortages - so age will be a factor, but I am in a field (unlike IT) where experience counts for more. If for some reason, I could not find employment, I am happy to try working for myself - my nest egg could support that.

I am beginning to think my best bet is to find try to take a downgrade - stay in the system and contribute in all ways, but with less stress. I need to look into ways of doing this. thanks again all

 

[giannaluna]

yes pb - it has dawned on me that by leaving, I doubt I could make up for in salary, what I would lose in the 5 years between 60 and 65 with respect to healthcare costs..not to mention that FEHB cover retirees abroad which for me, is a bonus.

GL