Can I live on a 10 million retirement?

[K-Man]

Some investment advisors were making noises a few years ago about even $1M not being enough for retirement. They claimed you needed at least $2M–3M then.

These articles asking about whether $10M is enough might be looking at today's higher inflation over time. Interest rates for savers are still low, too.

If inflation is near 10% per year for years on end, and your savings are getting under 1% annually, and the stock market and other investments are stagnant as in the 1970s, suddenly that $10M figure looks less ridiculous.

 

[Dave Hess]

The relevant question for a huge percentage of Americans is can I live in retirement with thousands of $ in credit card debt.

Yep, look at the exponential growth in credit card applications and debt, especially older folks struggling just to make it.

Folks on TV say to completely ignore the inflation.

 

[supton]

Some investment advisors were making noises a few years ago about even $1M not being enough for retirement. They claimed you needed at least $2M–3M then.

These articles asking about whether $10M is enough might be looking at today's higher inflation over time. Interest rates for savers are still low, too.

If inflation is near 10% per year for years on end, and your savings are getting under 1% annually, and the stock market and other investments are stagnant as in the 1970s, suddenly that $10M figure looks less ridiculous.

5 or so years ago I was thinking I needed around $3M when I get ready to retire in 2043 (give or take). Just like it's not my dad's Buick anymore, $1M isn't my retirement plan either. Times change, and inflation sure changes things, but inflation has been around for decades.

 

[ATex7239]

Some investment advisors were making noises a few years ago about even $1M not being enough for retirement. They claimed you needed at least $2M–3M then.

These articles asking about whether $10M is enough might be looking at today's higher inflation over time. Interest rates for savers are still low, too.

If inflation is near 10% per year for years on end, and your savings are getting under 1% annually, and the stock market and other investments are stagnant as in the 1970s, suddenly that $10M figure looks less ridiculous.

That’s a very fair point. I think another point to the $10M figure is the ability to live off of the income without ever touching the principal. I think that’s what a lot of these articles are suggesting. Not killing the goose that laid the golden egg so to speak. Which you’d really need these higher numbers in order to do. However I think most people expect that they are going to dig into their principal at some point. I know I plan to. I want to leave something for my kids. But I don’t plan on leaving them all of it.

 

[nomas]

Ten mill plus Social Security ? No problem for me . I think I could pull it off with far less .

 

[JeffKeryk]

Some investment advisors were making noises a few years ago about even $1M not being enough for retirement. They claimed you needed at least $2M–3M then.

These articles asking about whether $10M is enough might be looking at today's higher inflation over time. Interest rates for savers are still low, too.

If inflation is near 10% per year for years on end, and your savings are getting under 1% annually, and the stock market and other investments are stagnant as in the 1970s, suddenly that $10M figure looks less ridiculous.

If that's true than just about everyone in America is in trouble.

 

[Bill_W]

If that's true than just about everyone in America is in trouble.

We are in a bad season right now… You know “To every thing there is a season”

 

[wpod]

It depends.

 

[Revving2Redline]

We need to shut this thread down and lock it right now! There's a bunch of old timers on here and we don't need to be given the senior citizens any thoughts about retiring. Some of them give us the best data and photos on this forum. Plus I don't think anybody on here can be a car person and sit idle as we know that for an automobile it causes fuel dilution and for the human body in mind it leads for boredom and early self-destruction. My biggest hope is if anybody retires really big that they keep doing what they were doing on here so that we have something to hope for and for people to learn from. There's some really swell people on this forum and I wouldn't mind having some of them over just not all of you at one time. My Dobermans would have a stroke and a conniption fit LOL. Have a wonderful Sunday afternoon. It's almost 50° today it's almost tempted to go outside and work on my tan.

 

[Dave Hess]

I read an article and almost fell out of my chair that this was even a topic. Of course 99% of people could live well on that.

Now back to reality, do you think 1 million is still enough to live comfortably in retirement when you include SS?

$1M is enough if your house is paid off when you retire and you have a handle on your spending / monthly bills / CC debt.

No need to buy fancy vehicle(s) , fancy vacations, etc….

Proper money management with SS, 401K and IRA.
No helping grandchildren, they can get a job and help themselves.

 

[GON]

I think the real center of gravity is the value of the USD, not how much one has in non-land assets.

A study of countries with like lifestyles of U.S citizens, that went through a major currency devaluation, might help determine how much one needs to have a protected retirement. Maybe 5 million in cash is worth less than 1 million in residential rental real estate, if a currency goes through a major change, such as a devaluation or is no longer the world's currency, etc.

Great question OP, think this is something we should all be looking it.

 

[JeffKeryk]

$1M is enough if your house is paid off when you retire and you have a handle on your spending / monthly bills / CC debt.

No need to buy fancy vehicle(s) , fancy vacations, etc….

Proper money management with SS, 401K and IRA.
No helping grandchildren, they can get a job and help themselves.

This is good advice for all of us, at all of our ages.
But the car when you have expendable cash, not before.

 

[ecotourist]

Our financial planner - my wife's actually - He ran a montecarlo analysis given income and predicted expenses accounting for cost of living and the results were yes ( less than 1m in the IRA) There was no erosion of principal.

But we live frugally. I think our combined expenses was about $70K/annum

Even with a worst case senario there wasn't more than a 65% erosion of nestegg in 26 years.

Most financial planners recommend a withdrawal rate that will not exhaust the initial amount after 35 years, 95% of the time. In normal times, a huge Monte Carlo study found that a 4% (indexed) annual withdrawal would not run out the capital 95% of the time for typical allocations like 60:40, 50:50, 40:60. But it seems to me that a 4% withdrawal rate got a bit dodgy at the extremes - things like 100:0, 90:10, 10:90, 0:100

When markets were running hot that "standard 4%" was reduced to 3.2 - 3.5% or so as the starting number. I don't know the current recommendation now that markets are down.

 

[JeffKeryk]

We are in a bad season right now… You know “To every thing there is a season”

Dunno... Are you buying or selling? Staying pat?
Strategies need to deal with the highs and lows because they are coming.
Otherwise you are driving while blind.

 

[joekingcorvette]

If you retire at 66 and only live to be the average life expectancy of about 80 and are debt free one million would be enough for most debt free people with paid off houses. Sure there are some big talkers but at the end of the day most people in the US could make it easily. It's all about your health. In order to obtain a million or more you have to be somewhat thrifty or have decent income to start with. Yahoo finance has articles on this all the time. Like others have stated even with a 4% CD a million dollars plus SS income will keep the wolf from the front door.

 

[Bill_W]

Dunno... Are you buying or selling? Staying pat?
Strategies need to deal with the highs and lows because they are coming.
Otherwise you are driving while blind.

Future…? That will be in the news tomorrow. I have tomorrow’s paper here right now. Everyone is driving blind.

 

[ecotourist]

If you retire at 66 and only live to be the average life expectancy of about 80 ....

Life expectancy continues to extend as you get older.

The life expectancy of a 66 year old male is actually 83 years 9 months.

The life expectancy of an 83 year old is 91 years 2 months.

https://coolconversion.com/heath/li...ese values are for information purposes only.

 

[ecotourist]

Dunno... Are you buying or selling? Staying pat?

Exactly. This time last year, in so called "good times", might have seemed like a good time to be buying. But buying right now (in these "bad times") is much better.

Is this a "bad season"? As JeffKeryk says it all depends on whether you're buying, selling, or standing pat.

I'm buying, so these are good times for me. Almost everything is on sale.

 

[SaberOne]

Nope, I would blow through a million in a week. The other 9 million would be subject to a boatload of taxes together with an attorney to try to protect it.

 

[JeffKeryk]

Exactly. This time last year, in so called "good times", might have seemed like a good time to be buying. But buying right now (in these "bad times") is much better.

Is this a "bad season"? As JeffKeryk says it all depends on whether you're buying, selling, or standing pat.

I'm buying, so these are good times for me. Almost everything is on sale.

In 5 years you will look smart. In 20 years you will be a genius. Others will be happy/sad based on short term results.