Ginger Chapman and her husband, Doug, are sitting on the health care cliff.
The cheapest insurance plan they can find through the new federal marketplace in New Hampshire will cost their family of four about $1,000 a month, 12 percent of their annual income of around $100,000 and more than they have ever paid before.
Twelve percent of their gross income sounds high, but not impossible.
But that $12,000 a year they are paying is net outlay, and to really understand what a humongous figure it is, it needs to be weighed against net income, which is what it will be paid from.
According to the latest figures, their federal income tax outlay should be around $25,000.
Social security will hoover up an additional 7.65%, or $7,650.
They luck out because New Hampshire doesn’t have a state income tax, although it has a property, education, and other property-based taxes in the neighborhood of $25/1000. If the Chapmans own a median-priced home ($200K), they pony up another $5000.
So their after-tax income is likely to be around $63,000, and their new insurance payments will represent about 20 percent of their after-tax income. Insurance may now be their single biggest expense.
This is the sort of debacle millions of Americans are faced with now, and will continue to find themselves facing over the next couple of years.