Markola
Thinks s/he gets paid by the post
Not true anymore after 2005.
Sorry, but you are incorrect. https://www.investopedia.com/articles/investing/092215/how-protect-your-retirement-lawsuits.asp
Not true anymore after 2005.
When I go to the doctor you see the rack rate and the negotiated rate because you have health insurance. It might be $250 full price, but the plan pays $80. This is one big reason to have it. They will rake you over the coals with everything full price without health insurance.
My outlook so far on that having paid (from my calculations) about $90-100K over the last 35 years into health insurance and having used a grand total of $0 of any benefit thereof.
Having self insured there for a bit when I first retired I can say it does add to one’s stress levels. But there is insurance and there is insurance. Doctor visits are cheap where I live, most prescriptions in the US are available over the counter and for equal or less than I paid as a co-pay In the US. But GoodRX is getting me equivalent prices on many items.Hi! thanks for the comments! I didn't expect a deluge!
@many
I kind of expected the thought of 'self insuring' for general healthcare would raise some comments. Was looking for see if there were any reasoned arguments or studies that could be pointed to for relative risks. My outlook so far on that having paid (from my calculations) about $90-100K over the last 35 years into health insurance and having used a grand total of $0 of any benefit thereof. If I had instead put that into the market would have accrued much more to be able to afford any major issue. I have had a couple close fiends die of cancer so have some idea on the toll that it would take. That being said, (in my opinion only) I would be hard pressed to continue such treatments; more of a quality of life than a length of life debate. In the past, I've had fractures, cuts, and other 'minor' items which I just took care of myself. So the thought process was mainly to see about handling the range of issues between 'small' like above; and 'extreme'. It's something that I know is a contrarian point of view so am welcoming your comments here to perhaps level out or modify my perspective.
@many:
As for paying the 10% penalty. I have done some basic calculations comparing the differences and found that my own calculations seem to align with what was written by the madfientist here. The differences between paying the penalty, sepp/72t, and roth (assuming tax brackets) are small. I've looked into sepp/72t and it is /very/ unforgiving for what appears to be a very little delta of just paying the penalty and doing what I want. Roth conversions I have also looked at but currently (while working) would be more expensive than just paying the penalties due to my current income. Does anyone here have any direct experience?
@latexman,target2019,Winemaker. yes, the handle is related to the roman stoic philosopher and statesman. As for the state; Winemaker has it correct that it's Illinois (older reference).
@Dtail- Thanks for that catch. I must have been thinking about RMD age. As for bonds/equity mix, that is something that I have been thinking about. With the potential longer horizon and looking at the study at EarlyRetirementNow here. I was trying to keep close to a 3% WR, but have enough in bonds to last 7-10 years. That looks like a range between 20 and 30% I was leaning it more towards the lower figure (20%) only really due to the current bond returns being really bad and likely to stay that way for several years (at least that's my current belief).
@USGrant1962: Yes the $28K bump was to handle any needed 'lumpy' costs that are expected such as HVAC; Roof; Car; major appliances; etc. And the rest would go into an after-tax S&P500 index fund. The point there is that the after-tax account would step up in basis at my death so would be more valuable for heirs than the pre-tax. I didn't think of the house as a source of funds for LTC, but I guess that can make some sense. It really I guess comes down to the disposition of the house if I want to bequeath it to someone or do something like a reverse mortgage. But that's an interesting thought!
Thanks for all the comments thus far. It's a major change of thought from accumulating for the last 3 decades+ and then turning around and seeing the steep downward drop-off of decumulation ahead. It is kind of dizzying coming to grips with everything.
Exactly. Here's our example:Exactly this. Perfect example: I currently have a torn meniscus - a simple shower slip, didn't even fall, but the act of "catching" myself involved twisting my leg in the perfect combo of saving me and sacrificing the meniscus.
Anyway. A doc visit, xray, and cortizone shot was billed to my insurance at $900 - the retail rate. That's what I'd pay with no insurance. Since I haven't met deductible yet, I'm on the hook and the BCBS doesn't actually pay anything, but it gets reduced to the insurance-agreed amount which is reduced to $200.
I'll be the lone dissenter. You're single, relatively young, and have a good health track record. Presuming you can't get under the 400%FPL without cramping your style in a severe way, AND you're willing to travel to another country for major medical treatment, then your plan to self insure might pay off. Other posters brought up huge cancer treatment costs. But say you banked 50K over the next few years that would have otherwise would have gone to premiums. Now you're sick and the doc says you have cancer. You fly to somewhere, get treated like a king (unlike in the US) and pay out of pocket. AND, you continue that for an average of 6 months, because after that, you'd have gone through a November, and had a chance to buy a HI policy here in the US. If I were single, I'm not sure I'd be struggling to stay under 400%FPL, and instead, self insure. Like you, I've spent a whole hell of a lot of money on health insurance and have used as close to zero services as one can get. While I like that I didn't pay the "rack rate", it's an awfully expensive way to get a discount. Especially when better service and better prices than those negotiated rates are available if you cross out of the US.Keep your income under 4X poverty and get a subsidized ACA plan, self-insure is crazy talk.
I'll be the lone dissenter. You're single, relatively young, and have a good health track record. Presuming you can't get under the 400%FPL without cramping your style in a severe way, AND you're willing to travel to another country for major medical treatment, then your plan to self insure might pay off. Other posters brought up huge cancer treatment costs. But say you banked 50K over the next few years that would have otherwise would have gone to premiums. Now you're sick and the doc says you have cancer. You fly to somewhere, get treated like a king (unlike in the US) and pay out of pocket. AND, you continue that for an average of 6 months, because after that, you'd have gone through a November, and had a chance to buy a HI policy here in the US. If I were single, I'm not sure I'd be struggling to stay under 400%FPL, and instead, self insure. Like you, I've spent a whole hell of a lot of money on health insurance and have used as close to zero services as one can get. While I like that I didn't pay the "rack rate", it's an awfully expensive way to get a discount. Especially when better service and better prices than those negotiated rates are available if you cross out of the US.
The sudden onset, very expensive medical scenario is a problem, but two counterpoints. First, I figured the auto accident would be covered by automobile medical coverage. You might need to add an umbrella, but that's cheap. Second, we're dealing with a stochastic thing here; what are the chances you have a medical issue that arises so quickly as to prevent travel? I'd say before Covid-19, it was very low. Nowadays, you can't just up and go to another country for treatment, so I guess I'll relent and agree... just stay under the 400% FPL.
As the social media types are prone to saying...I’m just gonna leave this here:-
https://www.seattletimes.com/seattl...omes-with-a-1-1-million-dollar-hospital-bill/
so I guess I'll relent and agree... just stay under the 400% FPL.
Illinois is regarded as the sucker state.
Healthcare and health insurance is an emotional and political issue, so I don't think there is a lot of room for reasoned debate. You could sign up for an ACA plan, one of the non-compliant services, or take your chances. If you take your chances you could sign up for ACA later.Hi! thanks for the comments! I didn't expect a deluge!
@many
I kind of expected the thought of 'self insuring' for general healthcare would raise some comments. Was looking for see if there were any reasoned arguments or studies that could be pointed to for relative risks. My outlook so far on that having paid (from my calculations) about $90-100K over the last 35 years into health insurance and having used a grand total of $0 of any benefit thereof. If I had instead put that into the market would have accrued much more to be able to afford any major issue. I have had a couple close fiends die of cancer so have some idea on the toll that it would take. That being said, (in my opinion only) I would be hard pressed to continue such treatments; more of a quality of life than a length of life debate. In the past, I've had fractures, cuts, and other 'minor' items which I just took care of myself. So the thought process was mainly to see about handling the range of issues between 'small' like above; and 'extreme'. It's something that I know is a contrarian point of view so am welcoming your comments here to perhaps level out or modify my perspective.
Perfect example of someone who gets hit with something unexpected , in this case Covid 19, and there’s no way to fly to another country for treatment. $1.1 million medical bill. Fortunately, this patient is smart. He has insurance.
... My outlook so far on that having paid (from my calculations) about $90-100K over the last 35 years into health insurance and having used a grand total of $0 of any benefit thereof. If I had instead put that into the market would have accrued much more to be able to afford any major issue. ...
Healthcare and health insurance is an emotional and political issue, so I don't think there is a lot of room for reasoned debate. You could sign up for an ACA plan, one of the non-compliant services, or take your chances. If you take your chances you could sign up for ACA later.
It would be easier to self-insure if there was any transparent pricing of procedures available, but the tiered pricing system of in-plan VS out-of-plan coupled with after-the-fact charging make it very difficult to plan or predict anything. If your income if variable, ACA cost premium planning is difficult.
Every year that famous Eastwood movie line comes to my mind....."You've got to ask yourself one question. Do I feel lucky? Well, do ya, punk?"