High deductible has a annual payment cap, generally much lower than 100000.
But say you did have to pay 300,000 or more. In those 15 years you likely did not spend the 40,000 a year and thus you saving will grow some.
When you pay off your medical bill, you may not have your 40,000 to spend each year so you cut back a little. Maybe take on a lower paying job if you are worried about it. Then eventually get back to FI.
The consider the alternative. You are working 75,000 a year and you spend it, you have some savings for retirement and you have a large medical expenses with insurance paying 80% you owe 200,000 of the 1,000,000 medical bill. Now you need continue work to pay the medical, living costs, and you are much worse off then the one who follows a FI plan.
You've misunderstood my issue with the FIRE movement, but your argument is still specious in that it assumes spending even less than what was a predetermined minimum. If one's goal is FIRE and can reliably live on less than that, then that person would simply have reached FI even earlier.
My issue is that healthcare costs are inevitable, unpredictable, and largely ignored by the movement. I'm not arguing against the concept of living as frugally as possible in your indentured servitude so as to end that servitude sooner. I'm arguing that true financial independence in a country that does not provide universal healthcare coverage requires far more in assets than what any FIRE plan I've read ever mentions. Because the likelihood of costly healthcare needs increases with age, they are most likely to occur when it is too late to "cut back a little...take on a lower paying job ... get back to FI." Again, my only argument is that many of the bars for FI I see (such as passive revenue from investments of 40k) make no allowance for this issue. If your annual expenditures in good health are $40k, plan for a lot more to avoid being surprised by a 2-week ICU stay, 4 week inpatient rehab stint, and 6 weeks of outpatient rehab or worse permanent need for assistance either through home health aids or nursing home placement.
I suppose you could be right. This article is the first I heard of FIRE so I haven't read any plans. That needing medical prevents cutting back other costs.
But I thought I still covered the medical because they are supposedly have high deductible insurance so the 300,000 seems unlikely to actually be the cost.
Couldn't find a laid out plan so I searched for the specific issue and it seems they have reasonable answers to things.
Yes my concern is somewhat exaggerated but the solutions posited in that article are:
My concern is only for folks planning to retire and stay in the USA. Healthcare is not something you might need, it is something you will need at some unpredictable point in some unpredictable amount.
You had me going at first, but after going back to the article I realized that isn't what they were suggesting.
"she took a job after he retired). Should they need to self-insure in the future, Mr. Jensen would likely use a health care cooperative like Liberty HealthShare, as other FIRE adherents have"
So never mind, I'm out.
Cool, I'm not sure how the health share plan that requires a commitment to a faith-based lifestyle and still costs 15% of the 40k/yr budget contradicts my point, but yeah we're done.
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