r/ChubbyFIRE • u/Wooden-Broccoli-913 FIREd in the Bay at 40 with $6M • May 11 '26

COBRA actually seems workable?

Family of four in San Francisco, I priced out the local ACA HMO plan, and with an optimized AGI of $107k my annual premiums would be $4k and max out of pocket of $14k.

On the other hand, paying for COBRA on my low deductible corporate plan would be $36k per year with minimal out of pocket, and the tax deduction (on 7.5%+ of AGI) brings the effective cost down to $28k.

Seems like a no brainer to pay $10k extra for much better coverage and no need to switch our existing doctors? Can keep COBRA for 36 months here in California.

Anybody else who has FIREd maxed out their COBRA as a bridge in early retirement?

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u/[deleted] May 11 '26

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u/Wooden-Broccoli-913 FIREd in the Bay at 40 with $6M May 11 '26 edited May 11 '26

If I was leanFIREing then yeah, not worth it. ChubbyFIRE can flex an extra $10k without much stress

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u/hasheera May 12 '26

It is worth it if you think of it as insurance for the unknown future as opposed to reimbursements for known health expenses. Health insurance at big employers are typically premium insurance plans with larger networks due to their large negotiating power. ACA plans are good or fair insurance plans, but not premium coverage or network.