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Guide · Retiring before 65Health insurance when you retire before 65.
The years between your employer plan and Medicare are the most expensive coverage most people ever buy. In Florida, how you draw your retirement income can decide whether you pay a few hundred dollars a month or a few thousand.
Retiring at 58 or 62 is a great plan until the first health insurance quote arrives. Insurers can charge a 64-year-old three times what they charge a 21-year-old, and from 2026 the extra subsidies that softened that are gone. The good news: early retirees control their own income more than almost anyone, and that is exactly what subsidies are based on.
What it costs in Florida
Using Florida's 2026 average benchmark Silver premium and the federal age curve, approximate full prices before any subsidy are:
- Age 55: about $1,190 a month
- Age 60: about $1,450 a month
- Age 64: about $1,600 a month
- Couple aged 62 and 60: about $2,990 a month, or roughly $35,800 a year
Your county and plan choice move these numbers, but the shape is the same everywhere: the closer you are to 65, the more it costs.
The 400% cliff is back
The enhanced subsidies that ran from 2021 to 2025 expired on January 1, 2026. Now there is a hard cutoff: a household above 400% of the federal poverty level gets no premium tax credit at all. For 2027 coverage that is $63,840 for one person and $86,560 for a couple.
Here is what that means for the couple above. With income of $86,560, they would pay about 10.22% of income toward the benchmark plan, around $740 a month, and a subsidy of roughly $2,250 a month would cover the rest. With income of $86,600, they pay the full $2,990. Forty dollars of extra income costs them about $27,000 in subsidy over the year.
How retirees stay under the line
- Choose which account you draw from. Traditional IRA and 401(k) withdrawals count as income. Roth contributions, qualified Roth withdrawals and cash savings generally do not.
- Time Roth conversions. Converting in a year you are already over the cliff, or before you need subsidized coverage, can be cheaper than converting while on a Marketplace plan.
- Watch one-off income. Selling a rental, a large capital gain or taking Social Security early can push you over for the whole year.
- Plan for 65. Medicare starts the first of the month you turn 65. Line up the end of your plan with it so there is no gap and no overlap.
We are not tax advisors, and this is worth a conversation with your CPA. Our job is to show you what each income level means for your premium, so the two decisions are made together.
If your income is above the cliff
If you will be well over 400% anyway, compare private plans outside the Marketplace with full-price Marketplace plans and COBRA. At that point price, network and the doctors you want to keep decide it, not subsidies.
Next step
The ACA subsidy calculator shows where your planned income falls against the cliff. If you are leaving a job, the COBRA vs private insurance calculator compares the two directly. Or get a free quote and a licensed advisor will model your options within 24 hours. More on this: retirement and pre-Medicare coverage.
Common questions
How much does health insurance cost at 60 in Florida?
Before any subsidy, the average Florida benchmark Silver plan for a 60-year-old is roughly $1,450 a month, based on 2026 state averages and the federal age curve. A 64-year-old pays about three times what a 21-year-old pays for the same plan. A subsidy can bring that down dramatically if your income is under the cliff.
What is the subsidy cliff for retirees?
Premium tax credits stop completely above 400% of the federal poverty level. For a household of two that is $86,560 in modified adjusted gross income for 2027 coverage. One dollar over loses the entire credit.
Do retirement account withdrawals count as income for subsidies?
Withdrawals from a traditional IRA or 401(k) count. Roth IRA withdrawals of contributions and qualified distributions generally do not. Cash from savings does not count. The mix you draw from is the main lever retirees have.
Should I use COBRA until Medicare?
COBRA usually lasts 18 months, so it only reaches Medicare if you retire after about 63 and a half. Earlier than that, you will need another plan anyway, and a Marketplace plan with a subsidy is often far cheaper.
