Early Retirement and Medical Insurance

There is No Medicare Supplemental Insurance Under Age 65

Medical care is going to be expensive no matter when you retire, but the picture is more serious for employees who retire early, by choice or otherwise.

Because of the high cost of medical coverage before Medicare eligibility, a typical worker retiring at age 62 who does not have any subsidized retiree-medical benefits -- a retiree health plan -- would replace only 59 percent of his or her pre-retirement income, according to Hewitt Associates, a management-consulting firm.

Because Medicare isn't available until age 65, a couple retiring today at age 60 needs in excess of $200,000 to cover medical expenses in retirement -- verses $160,000 if they retired at 65.