Author Topic: FIRE:Roth conversion to meet minimum Obamacare requirements with max subsidies?  (Read 546 times)


  • 5 O'Clock Shadow
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im age 47, single, no kids.
house paid off.

ira/Roth = $550k (Target 2035 fund)
after tax $ = $250k ($125k Bank acct, 125k heathcare fund)

expenses = $20k/yr
$250k/20k = 12.5yrs

so I have enough after tax $ to last me to age 59 1/2 where I can withdraw from my ira without penalty.
from age 48 to 58, convert $xxx IRA to roth.

$xxx = minimum amount income needed to get on Obamacare silver plan with max subsidies.
as I understand it, income under that amount forces me into Medicaid, which I don't want.
im assuming Obamacare is superior to Medicaid?



  • Handlebar Stache
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Since the healthcare fund is 50% of your savings to get you to 59 1/2, are you able to spend that on your regular budget items, or is it restricted to healthcare expenses?

You want to aim for 139% of FPL.  Qualifying for or avoiding Medicaid is either 133% of FPL or 138% of FPL.  I've never really needed to understand the reason for the two different numbers.

For 2018 for a family size of 1 living in the contiguous 48 states that works out to $12,060 * 1.39 = $16,763.40.

To get the maximum subsidies on a Obamacare silver plan you must stay under 150% of FPL, or $18,090.

Remember you may have other sources of income (interest, dividends, side gigs), so you'll have to subtract those from your conversion amount so that you end up at the targeted AGI.

Note that with the current federal government situation, a bronze or gold plan may be a better option than a silver plan.  This is because the price of silver plans went up quite a bit this year because the federal government is currently not paying insurance companies for the CSR subsidies, which is part of what made silver plans a good deal in the past.

Also, there may be options for either short term plans or association health plans which may also make more sense.  You'd have to investigate those.

Hope that helps; good luck!