Důchod, renta a FIRE
Health and Social Insurance When Living Off Investments
Key takeaways
- Health insurance is mandatory for everyone — without an employer you pay the full amount yourself.
- The amount depends on your status (self-employed, no income, employee) and current regulations.
- The minimum health insurance contribution is a legal baseline — actual costs during illness are different.
- Social insurance contributions depend on whether you carry out self-employed activity.
- Include this item in your target portfolio calculation — otherwise you are missing thousands per month.
When living off investments — without an employer covering part of the contributions — you must pay health and possibly social insurance yourself in full. This item is one of the most commonly underestimated expenses in FIRE and early retirement plans.
Health Insurance: A Non-Negotiable Obligation
Health insurance is mandatory for every resident of the Czech Republic. If you are an employee, your employer pays two-thirds of the contribution. Without an employer you pay everything yourself — whether you are self-employed or have "no income." The minimum contribution is set by statute (verify the current amount — it changes), and actual premiums depend on your status and assessment base.
If income comes from selling securities or dividends, it does not form the basis for health insurance contributions in the same way as self-employment income. The exact mechanism depends on your status and current legislation — verify with an accountant or advisor.
Social Insurance: It Depends on Your Status
Social insurance (pension + sickness) is paid as a self-employed person if you carry out self-employed activity. If you live off passive income (selling securities, dividends) and are not self-employed, the situation is different. Again, the precise status matters — consultation with a specialist is essential.
- Self-employed persons pay monthly advance contributions toward social and health insurance
- Minimum advances are set by law — actual amounts can be higher
- With low or no income from business activity the situation differs from employment
How to Incorporate This Into Your Income Plan
Add insurance as a fixed monthly line item to your expenses calculation. If you are targeting CZK 40,000 per month but forget insurance (potentially CZK 3,000–5,000+ per month), your real need is higher. This in turn increases the required target portfolio — see calculating your path to retirement income. For tax treatment of investment income, see ETF taxes in the Czech Republic.
FAQ
How much health insurance do I pay without an employer?
It depends on your status and the current statutory minimum. The minimum advance for self-employed persons is set by law and changes over time. Verify the current amount on the VZP website or in the statute. As a rough estimate, budget for thousands of Czech crowns per month.
Do I have to pay social insurance if I live off investments?
It depends on whether you are self-employed and whether you carry out self-employed activity. Passive income from securities does not create a social insurance obligation in the same way as business income. Consult a specialist for your specific situation.
When is it better to be self-employed versus having no income under FIRE?
Each status has different obligations and advantages. Self-employed persons pay advances but can deduct expenses. The "no income" status has minimum health contributions covered by the state under certain conditions. The choice is also affected by whether you run a business or invest only. Verify with a specialist.
Why is insurance so often overlooked in FIRE plans?
Most FIRE calculators come from the US, where the system is completely different. In the Czech Republic, health insurance is mandatory and the employer used to cover part of it. Under FIRE, that employer share disappears and you pay the full amount yourself — that is a real expense that must be in the plan.