Health coverage between leaving work and turning 65
This gap is the most expensive planning mistake I see. Someone retires at 62, assumes coverage will cost a fortune, and either delays retirement or takes a plan that doesn't fit — usually without ever finding out what the alternatives actually cost.
Here's the full set of options.
1. Keep your employer plan for a while (COBRA)
When you leave a job, you can usually stay on that employer's health plan for a limited period. This is called COBRA.
The coverage is identical to what you had — same network, same doctors, same deductible you've already partly met. What changes is the price: you now pay the whole premium, including the part your employer used to cover. That's often a shock, because most people never saw that number.
COBRA makes most sense when you're partway through a deductible, mid-treatment, or only need to bridge a few months.
2. Join a spouse's or partner's plan
If your spouse still works and has coverage, their plan losing-a-job event usually lets you join outside the normal signup period. This is frequently the cheapest option available and it's routinely overlooked.
Worth checking early — the window to join is limited and starts when your old coverage ends.
3. Buy your own through the marketplace
This is the individual market created by the Affordable Care Act. You buy directly rather than through an employer, and you can't be turned down or charged more for a pre-existing condition.
Plans are grouped into tiers that trade monthly premium against what you pay when you use care. There's an annual open enrollment period, plus special enrollment when you lose other coverage.
4. Short-term and other non-marketplace plans
There are plans sold outside the marketplace that look cheaper. Some are genuinely useful for a short, specific gap. Others can decline you for health history, exclude pre-existing conditions, or cap what they'll pay.
They aren't automatically a bad idea, but they are the option where the details matter most and where the price difference usually has a reason behind it. Read what's excluded before the price.
What about dental and vision?
Usually separate, and usually smaller decisions. The main thing to know is that dental plans often have an annual maximum they'll pay — which is a very different shape from health coverage, where the protection is against the large costs rather than the routine ones.
What to do next
Two numbers make this whole decision tractable: when your current coverage ends, and what your household income will realistically be in the year after you stop working. With those, the options sort themselves quickly.