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How Much to Retire right now? (1 Viewer)

3 mill without thinking about it. If I were to crunch some numbers I might get closer to 2. But I'm within 10 years of retiring anyway and would be giving up about 1 mill.  No kids, late 40s. 

 
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10 mil in real estate and 3-4% yield low risk investments would provide a very comfortable annual income without touching principal. 

 
elbowrm said:
This is really a question about what you think your future earning potential is.
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Sort of... I think of it more as 'what is the value of the time to you personally that you will spend working.'

If you could be guaranteed a certain income - maybe significantly less than what you make now but you eliminate the commute, the working hours, the stress... but you drive an older car, have 1000 square feet less in your house, eat out less often... would you do it and how much less would you be willing to live on?

 
Binky The Doormat said:
If you don't have to touch it over that 50 year period of time.  

And even without touching it - losing 50% of your portfolio means you need 100% gain to get back to even. 
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Well starting in 67, it went up 2000+% until 90.  Even at its lowest after that in 2009, it was still up 400+% from 67.  So in that 50 year time frame, he would've made a killing.   

 
What about current health care. Do you lose that as well? or is that considered part of the pension or retirement benefit?

If it does, then most peoples number is going to increase by 50-100%

 
KCitons said:
What about current health care. Do you lose that as well? or is that considered part of the pension or retirement benefit?

If it does, then most peoples number is going to increase by 50-100%
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It's up to you. I guess you could stay on Cobra for a couple years... after that you'd have to figure something out

 
NutterButter said:
Well starting in 67, it went up 2000+% until 90.  Even at its lowest after that in 2009, it was still up 400+% from 67.  So in that 50 year time frame, he would've made a killing.   
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That's fair.  

My concern (being a retired FBG) is if I started this whole deal in 1990.  It's not without risk.  

Looking back at the US stock market, the numbers are with us ...but no guarantee that it will continue.  

 
fantasycurse42 said:
34, 2 kids.

$8.5MM - $425k a year, safely and passively invested at 5%. Never have to touch the principle.




 
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You guys are killin' me.  I would love to safely and passively invest at 5% for the rest of my life.

Speaking as someone who is trying to do that now ...not so easy.  And certainly a LONGGGGGGGGG way from guaranteed.  

 
48 with a wife and 1 kid still at home who will go to college. I'd put serious thought into anything over 1.5 million. 2.5 million would become a no-brainer, as a half million would easily cover all debt including my home, pay for college for my kid. At even 3% a year for me, and another 1% for kick-butt insurance, pretty sure I could live just fine on 60K/year. I appreciate the idea of inflation and that 60K today won't likely work in 30 years, but I'm pretty sure 4% is also on the low side for long term planning, and at some point after 70 I can start cheating a little extra out of the principal.

 
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sublimeone said:
If you could be guaranteed a certain income - maybe significantly less than what you make now but you eliminate the commute, the working hours, the stress... but you drive an older car, have 1000 square feet less in your house, eat out less often... would you do it and how much less would you be willing to live on?
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I see these as different - it's the whole lump payment vs. payouts in retirement (or even the lottery) - those have certainty or backups plans (getting another job) as does your scenario I quoted above.  The OP requires a level of risk that makes you put the number higher than we'll probably ever need.

 
Moe. said:
I assure you that I understand how much money that is. I could make it work on a sixth of that if I had to, but I wouldn't want to. If I am going to have to give up everything I've accrued up to this point, plus all future earnings/benefits/inheritances etc he's going to have to wow me with the number. It would be much less stressful for me to live my regular life imo than to take a couple million at 32 years old and manage it properly for the next 60 years. 

I promise I understand the time value of money and all that crap, you don't have to be condescending. Also, there's more to it than just the money. I like working. If he's taking that away from me, the ******* is going to have to pay. 
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I get it.   Lots of people who won the lottery are dead from drugs, or lost ALL the money.  There is a great deal of value in the work itself, and what the respect for the work brings for your psyche.  

 
31, no kids. $3 million is the smallest number that I'd consider a no-brainer. I could potentially say "yes" to a lower number but it would require more thought.

 
Niles Standish said:
With 14.5 million I'd imagine you could afford some good long-term care insurance.
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With 14.5 MM you won’t need LTC insurance.  Unless you live like a complete rock star and blow your wad.

Everything boils down to your standard of living and how outrageous or humble you live.

For me...47 married with one child.

Give me a lump sum of 5MM after tax and I will easily be set for life...no worries. Hell I can pull it off with 3-4MM as well as my investments will be fine over the long term while generating my income.

But with 5MM (hell even 3-4MM) I can easily create a conservative 3% yield in a nice growth and income portfolio of high quality dividend stocks and muni’s. Plus SS coming in for my wife and I later on.

Done. 

 
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I'm 46 with a wife and 3 kids.... and I don't want to retire. I own my own business, I work around 20 to 25 hours per week. I use an alarm clock to wake up on average about twice a week. I frequently have afternoon sex with my wife, and nap afterwards. I answer to nobody and all our needs are met. 

Why would I want a different life than that?  :shrug:

 
Politician Spock said:
I'm 46 with a wife and 3 kids.... and I don't want to retire. I own my own business, I work around 20 to 25 hours per week. I use an alarm clock to wake up on average about twice a week. I frequently have afternoon sex with my wife, and nap afterwards. I answer to nobody and all our needs are met. 

Why would I want a different life than that?  :shrug:
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Because you could have all the same things minus the alarm clock and the 20 hours of work?

 
$4M.  late 40's, wife a little older, no kids.

$1M off the top for setup.  Nice home fully paid for on/near water, add a SUV suitable for traveling and towing, modest fishing boat.  https://www.zillow.com/homedetails/2884-John-Anderson-Dr-Ormond-Beach-FL-32176/47992503_zpid/

I'd invest the remaining $3M 60-30-6-4 (equities - bonds - CD ladder - cash).  $1.8M - $0.9M - $180k - $120k.  Vanguard broad market index funds, VTSAX (1.9% dividend currently) and VBTLX (2.5% dividend currently).  No life or LTC insurance.  Keep it simple and self-insure.

Annual spending of around $100k (3.3%).  $70k for bills, food, taxes, healthcare, home insurance and maintenance, etc.  $30k for some trips and frequent meals out, etc.  Healthcare would come down some once into Medicare, hopefully.  CD ladder would provide $35k per year with some inflation protection.  Dividends on equities and bonds would provide another $55k per year.  $90k total annual income pre-SS.  $130k post-SS.

Annually rebalance, and purchase a new 5-year CD.  Running a small $10k deficit, funded during rebalancing.

All the numbers above are in today's dollars.  Shouldn't have any problem growing to beat inflation.  Sufficiency of cash, CDs, bonds to avoid having to sell equities in even prolonged down equity markets.  Low, but not no, risk.  Provides needed growth over time.

cFIREsim shows 100% success through 2060, with the worst retirement year (1966) reaching a low of $1M in 1984.  That would be a pucker, but net worth would still be close to $2M assuming home value keeps up with inflation (it may not, but the equity would still be substantial).  We would have cut some spending long before that happened.

Also works if I reduce SS by 25%.

Maybe $5M would be better.

 
$20mln

38YO, 2 kids

Based on our family history, wife and I should both live into our 90s.  I have a good paying job, with a pension that I enjoy.  The amount needs to be very safe for me.

 
interestingly, I hadn't taken into account the farmland my wife inherited.....if I have to give up everything I have already, it would have to be TigerFan money.  At least $20M

 
LOL at 20 million.  Very few people in here who will ever earn that in a lifetime so the idea that you'd need that to walk away now is insane.  With 20M only an idiot would ever have to work again.

 
shader said:
LOL at 20 million.  Very few people in here who will ever earn that in a lifetime so the idea that you'd need that to walk away now is insane.  With 20M only an idiot would ever have to work again.
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again, it's all relative.  If you're living on $50-100k, $20M is a lot.  If you're living on $250k?  $500k?   Anyway, plenty of folks have won $20M in the lottery and have nothing to show for it.

 
Don't know if fully answered - but this means you'd have to give up any potential future inheritance as well (both you and your wife), correct?

 
I'm planning to retire around 55 or so. If I were to stop today, using my current retirement calculator, I'd need about $8 million. I'm 37, married, no kids. There's a possibility that we'd have a kid in the next couple years and all the cost that goes along with it though, plus there's one major factor that hasn't been mentioned yet.

My current track assumes I'm going to be working every day. But if I suddenly had an extra 40 hours a week free and clear to do what I want for the next 20 years, I imagine I'd need a whole lot of money to fill that void with things to do. Not gonna just sit around my house all day watching TV til 4pm, so I'd need a lot of extra money to travel, eat well, etc. I don't think I'd do it for less than $10 mil.

 
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MarvinTScamper said:
Well,  I don't think you're seeing how much money $10M-20M is.  I have a buddy who sold his company, and after paying off EVERYTHING, he lives on the interest.  And lives well.  He only started with $10M
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shader said:
LOL at 20 million.  Very few people in here who will ever earn that in a lifetime so the idea that you'd need that to walk away now is insane.  With 20M only an idiot would ever have to work again.
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After reading the thread, I have no idea what is schtick and what isn't.  

I live a very comfortable life right now....I enjoy work, get paid well...have a great pension, I go on vacations, all that stuff with relatively minimal risk. To give all of that up, I'd have to price that risk into it.  Both of my grandparents lived into their 100s....my wife's into their 90s.  I've busted my ### so far to make sure I can live the best possible retirement.

Only managing passive investments can be risky in and of itself....would need to make sure you're covered with very diverse portfolio due to market swings....I have no experience in that, so there's risk there.

Could I do it with less than $20mln....potentially, but I ran some quick #s in my head and then priced in some risk on top of it. 

 
Tiger Fan said:
After reading the thread, I have no idea what is schtick and what isn't.  

I live a very comfortable life right now....I enjoy work, get paid well...have a great pension, I go on vacations, all that stuff with relatively minimal risk. To give all of that up, I'd have to price that risk into it.  Both of my grandparents lived into their 100s....my wife's into their 90s.  I've busted my ### so far to make sure I can live the best possible retirement.

Only managing passive investments can be risky in and of itself....would need to make sure you're covered with very diverse portfolio due to market swings....I have no experience in that, so there's risk there.

Could I do it with less than $20mln....potentially, but I ran some quick #s in my head and then priced in some risk on top of it. 
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I don't know what kind of money you make....but With 20M, you could literally stick 10M in a regular ole bank account  and spend the next 30 years living off 10M dollars.

With 10M dollars you could buy:

Huge comfortable house:  1M

Two really comfortable and great cars: 100,000

Have 8.9 Million and no bills to last you 30 years.

That's 300k/year for 30 years...oh and you don't have a mortgage.  

I THINK that would allow you to go on vacation.

And your pension?  yeah, just 10M bucks that has been drawing interest for 30 years.   I think you'll be fine. :)

Cut those numbers in half and you'd still be fine.

 
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Tiger Fan said:
After reading the thread, I have no idea what is schtick and what isn't.  

I live a very comfortable life right now....I enjoy work, get paid well...have a great pension, I go on vacations, all that stuff with relatively minimal risk. To give all of that up, I'd have to price that risk into it.  Both of my grandparents lived into their 100s....my wife's into their 90s.  I've busted my ### so far to make sure I can live the best possible retirement.

Only managing passive investments can be risky in and of itself....would need to make sure you're covered with very diverse portfolio due to market swings....I have no experience in that, so there's risk there.

Could I do it with less than $20mln....potentially, but I ran some quick #s in my head and then priced in some risk on top of it. 
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I realize there is no "right" answer too...I'm just doing a different kind of math.   Say you're 40 (ish) - that would mean, if you lived to 100, you'll need to average $666,000 a year in income (assuming taxes stay the same, and don't increase dramatically) between now an 100 to earn $20,000,000, since you'd be in max tax bracket (i paid 47% AMT last year).

You gonna do that?  How about half?  You making $350,000/year?  That's 10M. And you better bet your ### you won't be making $350,000 as an 88 year old.

 
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