[quote=bearishgurl]
Everyone has a choice on which side of the “balance sheet” they want to be on, here. You read UCGal’s post where she stated that posters on earlyretirement.org are trying to figure out how to become eligible for tax credits by retiring earlier than planned or manipulating the types of retirement accts they are contributing to. They can also take a demotion NOW, work less hours or take LWOP or FML for part or all of the balance of 2013 in order to be eligible for tax credits in 2015. There are more than nine ways to skin a cat.
The “rules” have changed now so if you’re completely a W-2 worker who wants to insure yourself or a family member though a state exchange, you have to figure out a way to “work the system” if you want to be eligible for a tax credit or a higher tax credit. For many high earners, it isn’t worth it to do this, especially if all their family members are currently covered through employer(s) and they are happy with that coverage.
If you are a high earner and like it that way but need to get yourself or a family member health coverage through a state exchange, then suck it up and pay the premium they ask for whatever level of coverage you desire.
None of us really know how the nuts and bolts of the HCRA are going to play out until a year or two passes.[/quote]
Ummmm. I don’t think I said that.
Folks on E-R.org are discussing that they are now FREE to retire without worrying about pre-existing conditions.
They are discussing how it can pay off if you can manage your retirement budget to be under the ACA subsidy levels… But not from a still working perspective, but from a retired (early) perspective. And that crowd how ALWAYS focused on the spending side of retiring early. (Need a smaller nest egg if you live on the cheap.)
One of the tools previously used – pre ACA – was doing ROTH conversions – up to the top of your current tax bracket… for a tax payoff in the future. That has been discussed as being weighed against losing the subsidy if you convert too much and end up outside the subsidy.
Retirement contributions (for those still working) DO count as income (not tax defered from an ACA tax subsidy point of view… just as it’s not tax deferred from a SS contribition point of view.). Hence the MAGI vs AGI.
BUT – they are not talking about retiring earlier than planned. This group is heavily focused on saving/investing so that they can retire early… So there’s no lack of planning… the goal of most is to become financially independent and retire early. But many held back because of healthcare concerns. They had the money – but were worrying about not being able to get affordable insurance. Staying in jobs they They are talking about having the FREEDOM to retire because pre-existing conditions are off the table, and health care is possibly more affordable than they expected (with subsidies.)
