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Health insurance gap calculator

Retire before 65 and you face a gap: years without employer coverage and before Medicare. This estimates what bridging that gap with an ACA marketplace plan could cost — after the subsidies your income may qualify you for.

Your numbers
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Early retirees often control taxable income by choosing which accounts to draw from. Lower income, bigger subsidy.
Estimated total cost of the gap (10 years)
$70,727
About $7,073/year on average, from age 55 to 65. Your income is roughly 294% of the federal poverty level.
Cost rises with age
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Premiums climb each year as you age, then stop at 65 when Medicare begins. Estimate only — actual premiums and subsidies vary by state, plan, and year. Not advice.
The income lever: save $0
Drawing taxable income down to $40,000 instead of $60,000 cuts your total gap-years cost from $70,727 to $70,727 — about $0 in extra subsidies over the bridge to Medicare. The catch: lower income years are also your best Roth-conversion years, so there's a real tradeoff to balance.
The income lever most people miss
Your ACA subsidy depends on taxable income you partly control in retirement. planbend models how your withdrawal choices affect both your subsidy and your taxes, year by year — free to start.

The gap nobody warns you about

Medicare eligibility starts at 65. Retire before then and you lose employer coverage with no government program to replace it — a gap of months or years you have to fund yourself. For someone retiring at 55, that's a full decade of buying your own health insurance, and it's one of the most underestimated costs in early retirement planning.

How ACA subsidies change the math

The sticker price of a marketplace plan for a couple in their early sixties can be alarming — often well over a thousand dollars a month. But ACA subsidies cap your premium at a percentage of income, and the lower your taxable income, the larger the subsidy. This is the crucial insight for early retirees: because you often control which accounts you draw from, you can shape your taxable income and the subsidy that follows.

The tension with Roth conversions

Here's where it gets interesting: the same low-income years that maximize your ACA subsidy are also the best years for Roth conversions. But a conversion raises your taxable income, which can shrink your subsidy. Balancing these two — cheap health insurance now versus lower taxes later — is one of the genuinely hard puzzles of early retirement, and it's exactly the kind of tradeoff worth modeling carefully rather than guessing.

planbend is a planning tool, not a financial advisor. This calculator uses simplified premium and subsidy estimates that vary widely by state, plan, and year, and ACA rules can change. For your situation, the Resources page can help you find a licensed professional.

Common questions

How do I get insurance if I retire before 65?
Most early retirees buy ACA marketplace coverage. Premiums depend on age and location, but income-based subsidies can cut the cost sharply for those who manage taxable income.
How much does ACA cost before Medicare?
Unsubsidized premiums for an older couple can run $1,000 to $2,000 a month, but subsidies cap your premium at a share of income, so net cost can be far lower.
How do subsidies work in early retirement?
They're based on income relative to the poverty level — lower income means bigger subsidies. Early retirees often control taxable income, letting them qualify for meaningful help.
What is the subsidy cliff?
Income above 400% of poverty once eliminated subsidies entirely. Current rules cap premiums at 8.5% of income above that line, softening the cliff, though rules can change.