Gap in Insurance Coverage Delays Early Retirement for Many.

As the "first wave" of baby boomers is reaching retirement age, many have thought about taking early retirement before the age of 65 when they would qualify for Medicare benefits. But according to insurance and retirement planners the thought of not having access to affordable health insurance when they might leave their jobs between the ages of 55 and 63, is holding many potential early retirees back. However there are affordable health insurance options for seniors and early retirees that can help bridge the gap until Medicare benefits kick in. However, like with many things health insurance related it just requires a little education, and some proper planning.

Experts suggest using COBRA - the federal law that guarantees that if you were covered by Health Insurance from an employer, you are entitled to continue those benefits on your own if you leave - only as a last resort. COBRA benefits are expensive, and temporary. You can usually find an affordable individual health insurance plan that offers the same or similar benefits to a COBRA policy for less. More importantly since COBRA benefits have a limited term, usually to a maximum of 18 months, should you become ill while under COBRA and then need to seek out affordable private health insurance you may be denied coverage. This is why experts agree that it is best if you purchase an individual health insurance policy while you are still healthy, and it is imperative that you make sure your affordable individual health plan is renewable. This way unlike with COBRA should you develop a condition, the policy must be renewed. In fact it is for this reason that financial planners suggest that those who are working and covered under company benefits but are approaching retirement age, or thinking about early retirement, shop around for an affordable individual health plan while still at work and healthy. This way you will have coverage down the line when your are older and may have developed a condition that could deny you coverage. Also many companies will offer to help pay for or offer other types of compensation to employees who opt out of their health insurance plans.

If you have not already opened a Health Savings Account, (HSA) and are thinking about early retirement, now is the time to do so. High deductibles are the surest way to obtain an affordable health insurance policy, and the higher deductible has the added advantage of qualifying you to open a tax deferred HSA. The amount you can contribute to an HSA increases for those over 55.

Short-term health insurance polices are a very good affordable health insurance options for those with less than a year to retirement. A non-renewable, short-term policy can be as much as 25% less than a long-term individual health insurance policy of similar coverage. While there are several options for affordable medical coverage for the early retiree, going without any insurance and hoping that you stay well until age 65 is not one of them. Last year more than half of the personal bankruptcies in the country where due to medical bills, and recent changes to the bankruptcy laws will make it even more difficult to eliminate medical debt. Do not look forward to retirement by being short sighted when it comes to medical insurance. Planning ahead by looking into an affordable individual health insurance policy now can help make the latter years a little more Golden.