Retiring Early? Here Is How You Handle Health Insurance

September 25, 2026 - 06:19

Leaving the workforce before age 65 sounds appealing until you look at the price of health coverage. In the United States, most people under 65 get insurance through an employer. Once that job ends, the subsidy disappears and the full cost lands on you.

A recent case out of Pennsylvania shows how steep that bill can get. A worker who retired in his late fifties watched his monthly premium jump from a modest payroll deduction to more than a thousand dollars for a comparable plan. Over a year, that is real money, often more than a mortgage payment.

There are a few paths. COBRA lets you keep your old workplace plan for up to 18 months, but you pay the entire premium plus an administrative fee. Marketplace plans under the Affordable Care Act are another option, and subsidies may apply if your income is low enough. Some people delay retirement until 65, when Medicare kicks in. Others work part time at a job that offers benefits, or set aside money in a health savings account years in advance.

The lesson is simple. Before you hand in your notice, price out coverage first. A retirement budget that ignores insurance can fall apart fast.