Many people dream of retiring early. And while the current life expectancy of 76.4 years can be a real motivator, the big question is whether they have enough money to make that retirement dream a reality. And that means factoring in the cost of health care.
According to Fidelity Investments, a healthy 65-year old couple can expect to incur about $315,000 in healthcare costs through retirement. That’s a significant sum that can quickly eat into any savings — and potentially ruin the golden years that were meant to be spent enjoying your accomplishments, hobbies and family.
But if you have a plan to retire early, don’t let the fear of medical expenses derail your dreams. There are several options available to help you get a jump Go to the page start on your golden years while maintaining affordable health insurance coverage.
First, explore your employer’s option for a phased retirement program. Roughly 1 in 10 employers offer this option, which allows employees to transition out of full-time work while continuing to receive some benefits – including their employer-sponsored health insurance.
If you don’t have access to a phased retirement program, consider taking on a part-time job with a flexible schedule that fits your lifestyle. Ideally, this job would pay a decent wage and include affordable health insurance for the portion of time you work.
Another option is to find a Medicare Advantage plan. These plans are a type of Medicare supplement that pays for the things that Original Medicare doesn’t cover, like copays, deductibles and coinsurance. The best Medicare Advantage plans come from top-rated insurers such as Aetna and Cigna. These companies consistently rank high in the Centers for Medicare & Medicaid Services (CMS) star ratings and offer competitive benefits that won’t expire at the end of your term.
Lastly, you can also purchase short-term health insurance to cover you between jobs or until you’re eligible for Medicare. These plans are available to anyone and typically have no preexisting condition exclusions. UnitedHealthcare offers a product called TriTerm Medical, underwritten by Golden Rule Insurance Company, that is available in select states and provides up to 36 months of affordable coverage before you must transition to a permanent plan or face Medicare enrollment penalties.
In addition, some life insurance policies can be converted to long-term care coverage in the event of an accident or illness. This may allow you to tap into the value of your death benefit to help cover those expensive long-term care costs that aren’t covered by healthcare insurance or Medicare. For some, this may be the only way to affordably cover these potential expenses.