COBRA vs Marketplace FAQ
Is COBRA or a Marketplace plan cheaper for early retirees?
A Marketplace plan is usually cheaper for early retirees with low or medium income. With COBRA you pay the full plan price your employer used to help with, plus a small fee. A Marketplace plan can cap what you pay based on your income. COBRA can cost less in a year when you make too much to get any help.
How long does COBRA coverage last?
COBRA usually lasts up to 18 months after you leave your job. That is why CobraCalc only shows COBRA for the first year and a half. After that, you use a Marketplace plan or other coverage until Medicare starts at 65.
What income counts toward MAGI for Marketplace subsidies?
Most of the money you make counts: pay from a job, money you take out of an IRA or 401(k), profit from selling investments, dividends, interest, and all of your Social Security (even the part that isn't taxed). Add it all up. Tax pros call this number your MAGI. CobraCalc uses it to figure out your help.
What is the Marketplace subsidy income cliff in 2026?
In 2026, if you make more than 4 times the federal poverty line, you get no help paying for a plan. For a single person that line is about $62,600. The extra help from past years ended in 2025. So one more dollar of income can cost you thousands. CobraCalc warns you when a year is close to (🟡) or over (🔴) this line. Read the full 2026 cliff guide →
Is COBRA worth it for early retirees?
Usually only in a year when your income is too high to get any Marketplace subsidy, or when you want to keep your exact doctors and plan for a short bridge to Medicare. COBRA makes you pay the full plan price plus up to a 2% fee, while a subsidized Marketplace plan caps your premium at a share of your income. For most low- and middle-income early retirees, a Marketplace plan is cheaper. See when COBRA is worth it →
Is COBRA the same as Obamacare?
No. COBRA continues your old job's exact health plan for up to 18 months, and you pay the full price. Obamacare (the ACA Marketplace) is a separate set of plans you buy on your own, and you may get income-based help paying for them. Early retirees can use COBRA first, then an Obamacare/Marketplace plan, until Medicare starts at 65. Compare COBRA vs Obamacare →
How much is health insurance if you retire at 55, 60, or 62?
It depends on your state, age, household size, and income. ACA premiums rise with age (an older person can be charged up to 3 times a young adult's rate), and retiring younger means more years to cover before Medicare at 65 — about 10 years at 55, 5 years at 60, and 3 years at 62. A subsidy can lower the price a lot. See the early-retirement cost guide →
When can early retirees stop using COBRA or the Marketplace?
Most people can use Medicare at age 65. So the COBRA-versus-Marketplace choice only matters from the year you retire until age 64. CobraCalc shows every year up to 65, then marks where Medicare takes over.
Can I lower my income to qualify for a bigger Marketplace subsidy?
Yes. Your help is based on your income for the year. You can plan when to take money from an IRA or 401(k), or when to sell investments, to stay under the cut-off and get more help. Early retirees often have more control over this than workers do. Check with a tax pro first.
Does CobraCalc store the numbers I enter?
No. CobraCalc runs on your own device. The math happens in your browser. Nothing you type is sent or saved on any server.