Retireby45ish
Recycles dryer sheets
- Joined
- Dec 8, 2018
- Messages
- 209
Hi all,
Had a question I wanted to run by everyone.
I will be selling my home and buying a new one. But I am also planning to retire in the next 2 years or so (at 44ish). A big part of that is keeping health insurance costs low by using ACA. For that I want to stay under the 400% threshold. This means I need to keep my dividend and other passive income low enough.
at first I figured I would just buy the new house outright ($700k or so) and that way I wouldn’t have to sell assets which counted towards the ACA income calculation. I was just going to treat the paid off house as kind of bond. And I could live that way to minimize MAGI. But now I’m torn. What am I missing? Here are my thoughts…
Cash benefit route:
Get about 7k of premium benefits per year plus a much lower out of pocket max. (Not sure about second part). Will this change much over time?
Invest and sell cap gains or dividends benefit:
Rate of return above mortgage (long run estimate = 2%). On 700k is 14k per year. After taxes = 10k
It seems like it might be worth it to not pay cash for the house?!
Also, on ACA…the wife is sicklier than I am (needs Dr visits and such often) and I wonder if there are cost savings to getting a better coverage for her than me. Can a married couple get different coverages?!
Had a question I wanted to run by everyone.
I will be selling my home and buying a new one. But I am also planning to retire in the next 2 years or so (at 44ish). A big part of that is keeping health insurance costs low by using ACA. For that I want to stay under the 400% threshold. This means I need to keep my dividend and other passive income low enough.
at first I figured I would just buy the new house outright ($700k or so) and that way I wouldn’t have to sell assets which counted towards the ACA income calculation. I was just going to treat the paid off house as kind of bond. And I could live that way to minimize MAGI. But now I’m torn. What am I missing? Here are my thoughts…
Cash benefit route:
Get about 7k of premium benefits per year plus a much lower out of pocket max. (Not sure about second part). Will this change much over time?
Invest and sell cap gains or dividends benefit:
Rate of return above mortgage (long run estimate = 2%). On 700k is 14k per year. After taxes = 10k
It seems like it might be worth it to not pay cash for the house?!
Also, on ACA…the wife is sicklier than I am (needs Dr visits and such often) and I wonder if there are cost savings to getting a better coverage for her than me. Can a married couple get different coverages?!