Planning to retire before age 65? You’re not alone. Many West Michigan residents are aiming for early retirement—but the big question becomes: how do you stay covered until Medicare kicks in?
Here’s what you need to know to protect your health and your wallet.
Why 65 Is the Magic Number
Most people qualify for Medicare at 65. Retiring before that means you’ll need to find alternate coverage—sometimes for several years. Gaps in insurance can be risky and expensive, especially with rising healthcare costs in Michigan.
Health Insurance Options for Early Retirees
There are a few main options to consider depending on your income, budget, and needs:
1. ACA Marketplace Plans (Obamacare)
This is often the best option. You can get coverage through the Affordable Care Act marketplace, and many early retirees qualify for significant subsidies based on household income—even in places like Sparta, Grand Rapids, and Muskegon. These plans can cover everything from doctor visits to prescriptions and preventive care.
2. COBRA Coverage from Your Employer
If you're leaving a job with health benefits, COBRA allows you to continue that coverage temporarily—usually up to 18 months. But it’s often expensive because you’ll be paying the full premium without employer contributions.
3. Short-Term Health Insurance
This is a limited option that can fill gaps for a few months, but it doesn't offer comprehensive protection. Pre-existing conditions often aren’t covered, and benefits are limited. It's rarely the best fit for someone truly retiring.
4. Spouse’s Health Plan
If your spouse is still working and has group coverage, you may be able to join their plan. Check with their employer to see what’s allowed.
Costs & Planning Considerations
- ACA plans can be affordable if you structure income wisely during retirement
- You may need to estimate income for the year to qualify for subsidies
- Budget for premium, deductible, and out-of-pocket costs in your retirement plan
Key Tip: If you plan to retire at 63½, remember that COBRA might cover you until Medicare starts. But if you're retiring at 60 or earlier, you’ll likely need a longer-term ACA strategy.
What About Life Insurance?
Retiring early often means losing your employer-provided life insurance. This is a good time to review whether a private policy is needed to protect your family or income stream. We can help with that too.
Here’s a Quick Checklist for Early Retirees:
- Review ACA plan options and subsidies for your ZIP code
- Ask your employer about COBRA continuation
- Consider your spouse’s coverage if available
- Rework your budget to include healthcare costs
- Talk to an advisor before retiring to avoid gaps
Need Help Finding Health Insurance Before Medicare?
At Quality Choice Insurance, we help early retirees in West Michigan explore ACA plans, COBRA options, and long-term strategies for healthcare. We’ll show you the real numbers and help you stay covered until Medicare begins.