[AMB444]

No real estate so need to pay mortgage.

Let's say this person is not yet 65.

[VAtoFLA]

Not enough without other pensions. Assuming only that and Social Security. It all of course depends on how you spend and want to live.

[Rainger99]

Originally Posted by AMB444

No real estate so need to pay mortgage.

Let's say this person is not yet 65.

Not yet 65? Is that 64 or 55?

It all depends on their expenses and their income and their life expectancy. Are they getting social security? Are they getting medical expenses paid? That is huge!

And it depends on the pension. Some government pensions pay 80% or more of your final salary. And final salary may be way above base salary as many employees work vast amounts of overtime the last few years to increase their pension.

Please note that the Dow had a high in December of 45,155 and is currently at 37,425.

That is a drop of 7,730 points and a percentage drop of 17.12%.

Gold is up $357.60 per ounce, or roughly 13.5%, from January 1 to April 8, 2025.

So if you retired with a million at the end of the year and you were 100% invested in the Dow, you would have about $830,000 left.

If you were all cash, you would still have the million.

And if you had 100% gold, you would be up about $135,000.

If you die in the next five years, you should be ok. If you live until 2050, probably not.

[Stu from NYC]

I would work more and try to do away with the mortgage before retiring.

[Plinker]

This is a question that is impossible to answer.

[AMB444]

Originally Posted by Plinker

This is a question that is impossible to answer.

Yes, there is so much to consider. It's not a one size fits all I guess.

Thanks everyone

[Pugchief]

If you are willing/able to live on $40,000/year plus whatever you get from Social Security, then yes, $1M is more than enough to retire on. Not necessarily here in TV, but certainly somewhere.

[thelegges]

No Real estate, so my guess is with National park pass, and a good tent one could travel the world until their dirt nap. Still have plenty of that million, to give to multiple charities.

[kkingston57]

Wife and I have no mortgage and have $5500 coming in from SS and a small pension Fixed expenses are about 2K a month. Leaves $4600 a month. 1 million in bank could get about 4% or 3300 a month and no reduction in principal. Yes this is do able

[Old Traveller]

There are two sides to everyone's balance sheet. Knowing what your assets are is not enough information to answer your question. What are your liabilities, and how will inflation impact your liabilities in the future? A spreadsheet might be helpful.

[CoachKandSportsguy]

The biggest determinate in retirement financial planning is the cost of your expected lifestyle. The more expensive your lifestyle, the more assets you need. The biggest obstacle to accurate spending is health care insurance cost and actual healthcare spending. . Like wise, the other determinate is are you living on dividends and interest only, or are you withdrawing principal for the difference.

So ball park figures:

Starting at full retirement age, with a 3% inflation rate per year of the expenses, assets which gives off 3% in tax free dividends, and 5% growth per year,

From a taxable account, not an IRA, and does not draw down on the principal, for every 25,000 of life style costs over and above Social Security income, you will need about $850,000 in assets.

OR

From a taxable account, not an IRA, and does draw down on the principal, for every 25,000 of life style costs over and above Social Security income, you will need about 300,000 in assets, which will disappear at age 86

So pick your incremental costs over social security, and save for your retirement. The same amount in a Roth will do. As far as an IRA account goes, then it's a more complicated model with taxes, penalties, and increasing distributions.

just a generalized starting point, not knowing your social security income levels. .

good luck

[dewilson58]

Originally Posted by AMB444

No real estate so need to pay mortgage.

Let's say this person is not yet 65.

How much R U spending??

[thevillages2013]

Originally Posted by stu from nyc

i would work more and try to do away with the mortgage before retiring.

bingo

[Federspiel]

Unless the Fed quits printing fiat money, the old million dollar cushion is closer to $2 million.
The inflation reduction $trillions printing reduced my purchasing power by $100k almost overnight.
Milton Friedman maintained that inflation was caused by excess Fed money printing. It is a cowardly political tax that congress is not accountable for.

Something else to consider, as houses appreciate we become more of a renter as property taxes and insurance sky rocket!

Unless the Federal Reserve is dismantled and we return to the gold standard, this will never end. I don't think even Trump could get that done in 4 years and no other politician will have the balls to try.

[rsmurano]

$1M to live on? Not even close to live comfortably. If you want to live like a hermit, watch every dime you spend, and hope there is no recession (there always is and can last a couple of years), then yes, you could get by.

None of the posts above included medical expenses, new cars, large car repairs bills, vacations, hospices expenses, home repairs, maybe redecorating/furniture expenses, etc.

No lose of principal? If you know what you are doing, yes, but 99% of the people don’t. Right now, the majority of the people have to sell some of their portfolio while the market is down, this is the worst scenario that can happen because when the market recovers, you have less in the market to get you back to where you were. Never allow this to occur. There are easy ways to not allow this to happen but most don’t do them.

Another thing to consider: how much are you making each year? Somebody said above you get 4% from your bank. Today yes, but normally you will get < 1%. Even at 4%, you are still losing money to inflation. You were getting 4% when inflation 2 years ago was triple that rate. You will never MAKE money when earning less than the inflation rate. But let’s say you are making 4% and inflation is 2% and you pull out the standard 4% each year to live on, your principal is already down 2%. And this is the best scenario.

If you base your portfolio on a the normal growth rate per year, then you better have have your portfolio setup so you never pull from it during a downturn in the market or you live long enough for the market to recover. For example, the average loss during the 2097/2008 crisis was around 40%. So take your $1M portfolio and decrease it by $400,000, now you have $600,000. If you take your 4% out per year, it’s now $24k you take out, not $40k because your base dropped. So do this for the average of 18-24 months that a recession can last, and your portfolio is now $550,000. Then if you needed any type of large expenses during these 2 years, your portfolio could be down to $500,000. Now, how long will it take you to get back to $1M so you can pull out the $40k you need to live on? You need the market to double to get you back to were you were years ago.

This scenario is more realistic than anything else stated above. I don’t go by averages, I go by what if scenarios. I never pull a dime out of my holding when the market is down like this, and actually, I have available $$$ to get in when the market is down.