Early retirement and Obamacare

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Buddy of mine retired early and his monthly premium is around $600.

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Just the wife and I and both in great health. $600 is a lot more tho than what Obamacare seems with the income I mentioned. Not worried about high deductibles as neither of us have ever gone to the doctor for anything other than annual checkups.

Claim you make $500,000/year and you’re sweating $600/month for health insurance? CLASSIC BabyTac.

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25000 is the sweet spot. Gotta keep your AGI excatly there. We pay 250/mo for both of us

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With interest and dividends as well as any capital gains, that seems like a pretty low threshold to be able to maintain.

Tax exempt muni’s are your (Obamacare customers) friend.

…although cannot escape IRMAA (MAGI) with them so keep that in mind when turn 63 (2 years prior to Medicare age), as I understand it.

Roth assets don't count towards MAGI. Some people use a strategy called a Roth Ladder, which is doing Roth Conversions at least five years ahead of when you retire, then realize enough taxable income to get the Obomacare subsidy you want, but use your Roth contributions and Conversions to supplement. I would only recommend this if you can comfortably get by on a MAGI that low.

I did it. From 2021 to 2025 then I returned to work. I didn't plan it, it just worked out that way. I lost my job during the Covid era and didn't want another one. I got free Obamacare in 2021 and 2022 because of Covid. I used 72T withdrawals from one of my rollover IRA's that put me at just the right spot MAGI wise. 2023 and 2024 was a bit more of a tightrope. I turned 59.5 in January of 2025 but I was facing the Obamacare $13K cliff in 2026, but I got a job in 2025 making nearly as much as I used to working from home, now with employer health insurance.

I think it’s silver yes I’ll have to check. I’ve deferred as much income as I can year to year (business sale proceeds) and we are living off cash at the moment. I can go another year at least and then we will have to figure something out. I wait until December to see where I’m at on realized gains then sell what I need to get to 25000. I also have a shitload of carryover capital losses from 3 years ago. I’m careful not to trade when I don’t have to

It’s a tightrope until I get to 65. If I have to bite the bullet for a year or two and pay market rates I’ll do what I have to do

Hear you on magi and ACA.

Meant that capital gains in magi won’t also be taxed at LTCG. There are a few hundred $ per month in no LTCG for OP, as well.

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CharlesUFarley
Roth assets don't count towards MAGI. Some people use a strategy called a Roth Ladder, which is doing Roth Conversions at least five years ahead of when you retire, then realize enough taxable income to get the Obomacare subsidy you want, but use your Roth contributions and Conversions to supplement. I would only recommend this if you can comfortably get by on a MAGI that low.

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Just did my first Roth conversion this year at 51. Couldn't do it during my last few years of working as my income level was way too high. I didn't realize it was MAGI, so I did a Roth conversion this year that after my itemized deductions wull have me hitting the top rate of 12%, but obviously that means I'm well over MAGI. Didn't end up mattering as we're in Europe for most of the year and I have a worldwide health plan excluding the USA for cheap. I gotta figure out how I'm gonna do this once we get back to the USA as I'll need to do at least another 8 years of conversions, likely more when considering taking some LTCG as well and keeping those at 0%. Will likely be here at least through 27 and maybe 28 so that buys me another couple of years of hitting Roth conversions as high as possible and just paying cheap Healthcare outside the US.

Obamacare is such a disaster with such high premiums and deductibles you might as well not even have insurance.