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Rising Star
Based on the ~4% rule, $5m would safely generate $200k / yr and $10m would safely generate $400k per year for withdrawal. Some are saying it needs to be more of a ~3.3% withdrawal rate but either way, those should be comfortable upper-middle to upper class depending on is your debts are paid off (i.e., no mortgage).
Okay, fair, SM1. Yes, you still pay taxes, but I think it’s still important for people to remember you’re not trying to “save” anything out of that.
Still a world of difference (at least for me) in how I would feel spending every post-tax $ of 200k “income” vs. how you feel as a 30-40 y/o with an income of 200k.
Chief
As a retired person, I always get a kick from those articles about a"good retirement amount" since there are so many variables (health, lifestyle, debt, etc.) that determine how much you may need. Also, keep in mind that if you withdraw the often recommended 4% annually but have a fairly aggressive portfolio, you will earn more than that each year and not touch your original balance.
Because I don't have much debt (small mortgage), I haven't touched any investments since I retired over a year ago.
Rising Star
How did you get it so high so fast?? Would love any tips you have!
Curious, with IRS caps, even maxing out contributions plus employer match since 2018 doesn’t usually get you to $420K. Did you roll over from another plan, or are you counting other accounts too?
EY didn't offer mega back door conversion until this year. I am also just as curious as I also started in the beginning of 2018 and maxed IRS limit each year. My 401k balance is $300k with an employer match included.
I index my retirement income and assets to gold, not the US dollar. How many ounces of gold a month do I need for a lovely retirement, and how can I have that in 20 years.
There is a huge disparity between what people think they need and what they actually need. 80% of couples living off social security plus $250K savings say they are very comfortable.
You really should not be retiring if you don’t own your home.
Jesus Christ dude how much money are you making/contributing? I’m at 400k but started working in 2013.
EY1 - I actually meant $420K in my 401K.
Chief
Having $5K in an IRA today will put you in the top 0.1%, so compared to most people, you can live quite well on that. Your current balance puts you in the top 5% today.
How do you have that much money
correct me if I am wrong, but that is $200K in real dollars, not adjusted for inflation. Dont know how old this person is, but $200K for when I retire is not the same as $200K today.
Chief
You need to look at your personal habits and spending to project your own income. You are also missing what age you want to retire. What exactly is “upper class” for you? You have minds? Family? Health needs? What is your monthly expenses today? What is going to be your desired monthly expenses ? Are you planning to do any investment outside of 401 K? What happens if you get fired or not make partner ? 420 K is all you have? Do you have a house? There are a LOT of things you need to figure out yourself
You are projecting a huge range. You are asking if you need $5 million or double of that based on what exactly?
Just retire in Southeast Asia. Just need $2MM to live off the interest of $90k a year.
Yeah most people don’t but it doesn’t stop millions of westerners who retire there comfortably and enjoy life there.