How to Get ACA Insurance if You Have 457(b) ROTH Investments

If you’re planning to retire early, you may be wondering how you’ll get health insurance. If you’re a state government employee with access to a 457(b) plan, you may be able to use your retirement savings to help pay for health insurance premiums.

What is a 457(b) plan?

A 457(b) plan is a retirement savings plan that is offered by state and local governments and some non-profit organizations. Contributions to a 457(b) plan are made on a pre-tax basis, which means that they are deducted from your paycheck before taxes are calculated. This can save you money on taxes now.

How can I use my 457(b) plan to help pay for health insurance premiums?

If you leave your job before you reach the age of 59½, you can withdraw money from your 457(b) plan to pay for health insurance premiums without paying a penalty. This can be a helpful way to bridge the gap between when you leave your job and when you become eligible for Medicare.

How do I know if I qualify for ACA insurance?

To qualify for ACA insurance, you must have an income that is below a certain level. The income limit for ACA insurance is based on your MAGI, which is your modified adjusted gross income. MAGI is calculated by taking your adjusted gross income (AGI) and adding back certain deductions and exclusions.

How can I lower my MAGI?

There are a few ways to lower your MAGI. One way is to contribute to a traditional IRA or 401(k) plan. Contributions to these plans are deducted from your AGI, which reduces your taxable income. Another way to lower your MAGI is to claim certain deductions and exclusions, such as the student loan interest deduction or the deduction for health savings account (HSA) contributions.

What if I don’t qualify for ACA insurance?

If you don’t qualify for ACA insurance, you may still be able to get health insurance through your employer or through a private insurer. However, you may have to pay higher premiums for private health insurance.

If you’re a state government employee with access to a 457(b) plan, you may be able to use your retirement savings to help pay for health insurance premiums. This can be a helpful way to bridge the gap between when you leave your job and when you become eligible for Medicare.