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10-20-2006, 08:20 AM
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#1
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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Is $1million enough
Here's the scoop
45 years old, single, sold the house and now I have $500k in after tax and $500k in tax deferred investments.
I can move pretty much anywhere and I'm frugal in my lifesytle.
Has anyone ERed on this and if so what were your strategies.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”
Current AA: 75% Equity Funds / 15% Bonds / 5% Stable Value /2% Cash / 3% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
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10-20-2006, 08:33 AM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 9,072
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Re: Is $1million enough
The old question of 'how much is enough?' I'm sure it can be done but obviously it depends on your lifestyle and budget. Only you can decide if its enough. Good luck!
__________________
Retired 3/31/2007@52
Investing style: Full time wuss.
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10-20-2006, 08:36 AM
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#3
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Re: Is $1million enough
You are frugal and mobile, which means that you can almost certainly manage. But I think you'll have to solve one big problem: health insurance. Crack that nut, and you should be home free.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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10-20-2006, 08:44 AM
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#4
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Full time employment: Posting here.
Join Date: Nov 2003
Posts: 926
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Re: Is $1million enough
__________________
Some of us have pretty stories, about good friends, good times and noodle salad.
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10-20-2006, 08:54 AM
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#5
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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Re: Is $1million enough
Quote:
Originally Posted by brewer12345
You are frugal and mobile, which means that you can almost certainly manage. But I think you'll have to solve one big problem: health insurance. Crack that nut, and you should be home free.
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I'm in a position where I can move to Europe which would solve the heathcare issues, but probably limit my spending
power given exchange rate and othe cost of living issues.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”
Current AA: 75% Equity Funds / 15% Bonds / 5% Stable Value /2% Cash / 3% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
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10-20-2006, 08:57 AM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Re: Is $1million enough
Quote:
Originally Posted by nun
I'm in a position where I can move to Europe which would solve the heathcare issues, but probably limit my spending
power given exchange rate and othe cost of living issues.
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Again, depends on your lifestyle and location. I think there are parts of Eastern Europe taht are very cheap place to live: Czech (less so), Slovakia, Croatia, etc. I hear the Dalmatian coast is very nice. You could also try Greece. If Malta ever makes it into the EU (put your left foot in, put your left foot out...), its a very pleasant place to live that is pretty iexpensive.
Currencies I wouldn't get too excited about either. It is pretty easy to invest in Euro or other foreign currency denominated stuff.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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10-20-2006, 09:01 AM
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#7
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Dryer sheet aficionado
Join Date: Nov 2005
Posts: 38
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Re: Is $1million enough
This has been discussed before. You might want to take a look at this thread: http://early-retirement.org/forums/i...p?topic=1494.0. $1M, without any other assets to rely upon, wouldn't fall within my comfort zone. But, that's just reflects my own situation . . . perhaps you feel more comfortable taking risks than I do. Good luck!
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10-20-2006, 09:39 AM
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#8
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Thinks s/he gets paid by the post
Join Date: Mar 2004
Posts: 2,343
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Re: Is $1million enough
It depends on your lifestyle requirement and how far you are from your ss payments.
Live on $40k, in Thailand, live like a queen, in France, live like a nun.
If you feel comfortable enough to live on $40k before taxes (w/o ss), yes you can.
__________________
I look to the present moment because that's where I live my life.
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10-20-2006, 09:51 AM
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#9
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Recycles dryer sheets
Join Date: Aug 2006
Posts: 65
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Re: Is $1million enough
Like others have said, it depends on your lifestyle and where you want to live. According to the us census the average family income is 45K, in your case being single using the 4% SWR it gives you 40K a year, I'll yes you can. Good luck.
Mach1
__________________
Dream as if you'll live forever. Live as if you'll die today.
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10-20-2006, 09:56 AM
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#10
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Thinks s/he gets paid by the post
Join Date: Mar 2006
Location: Houston
Posts: 2,155
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Re: Is $1million enough
nun,
In my opinion, it's MORE than enough.  With 40K a year, you can live ANYWHERE you want in the world.
The real question is whether you want to do it.  Only you have the answer.
From http://www.washingtonpost.com/wp-dyn...101901137.html
In 2006, the U.S. government drew the poverty line at $20,000 annually for a family of four, or a little more than $1,600 a month.
You are single, 1/4 of the above family.  Your income is 40K, twice as much.  What are you worrying about?  Plus in your very first post, you stated that your current monthly expense is $1,500.
Best of luck and congratulations on your wealth.
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10-20-2006, 10:05 AM
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#11
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2005
Location: Chicago
Posts: 13,186
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Re: Is $1million enough
Quote:
Originally Posted by nun
Here's the scoop
I'm frugal in my lifesytle.
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Yeah, but what makes ya happy? When do you feel like you're having an adventure? What excites you?
Just hunkering down and living frugally wouldn't do much for me. But you can have a lot of fun on the cheap if your personality allows it. What's calling out to you? If you're contemplating ER to escape from something, that's bad. ER to go have some fun, that's good!
1. Solve the hospitalization insurance problem
2. Listen to yourself and determine how you want to spend your time.
3. There are lots of fun adventures to have involving part time work or volunteer work that provides room and board.
3. Don't run away from anything. Run towards what you want.
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
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10-20-2006, 10:49 AM
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#12
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Thinks s/he gets paid by the post
Join Date: Jun 2005
Posts: 2,450
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Re: Is $1million enough
I am sure you could do it with less....get a working spouse or a government pension or even better marry somebody with a government pension
seriously, lots of people live on nothing more than social security....albeit, their health care is less of an issue...
__________________
- Hurry! to the cliffs of insanity!
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10-20-2006, 11:02 AM
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#13
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Recycles dryer sheets
Join Date: May 2006
Posts: 174
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Re: Is $1million enough
Quote:
Originally Posted by nun
Here's the scoop
45 years old, single, sold the house and now I have $500k in after tax and $500k in tax deferred investments.
I can move pretty much anywhere and I'm frugal in my lifesytle.
Has anyone ERed on this and if so what were your strategies.
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Presuming that this post is not a put-on . . . OP would probably gain a lot of useful info from Bob Clyatt's book (Work Less, Live More), although the book is a little lite on the health insurance question
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10-20-2006, 11:27 AM
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#14
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Thinks s/he gets paid by the post
Join Date: Mar 2005
Posts: 2,603
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Re: Is $1million enough
Quote:
With 40K a year, you can live ANYWHERE you want in the world.
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Not in the northeast (US) .... 15% federal and 5% state taxes leave you with 32K; healthcare will run 1k/mo ; a studio apt with utilities another 1k/mo; forget the car you can't afford the insurance (1k/year) .... Leaves you about 5-6k to eat, cloth and entertain yourself for the year.
Not my idea of FIRE.
__________________
FIRE'd since 2005
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10-20-2006, 11:34 AM
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#15
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Recycles dryer sheets
Join Date: May 2005
Posts: 228
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Re: Is $1million enough
Brewer,
A couple of addition to what you've said from a EU standpoint (as you know I'm French). There are some cheap places to live in eastern europe, that's correct, but not any longer on the dalmatian coast or in croatia. Prices have gone up as it it undoubtedly very nice. As far as Malta is concerned, it is a EU member state since 2004 though the currency does not seem to be the Euro (malta pounds) yet. As far as currencies are concerned I would not purchase Euros at the current exchange rate. Equivalence of products and services is around 1.1 and I would only start to by Euros from thereof. As you know I do the opposite and keep purchasing USD (better say stocks or assets denominated in USD) with my Euros as long as the Euro is above 1.1. I've been doing that for two (3?) years now and keep building up the position. But I've also a longer standpoint as I will not necessarily remain in Europe.
__________________
gnoti seauton
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10-20-2006, 11:46 AM
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#16
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2006
Location: Washington, DC
Posts: 11,331
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Re: Is $1million enough
Quote:
Originally Posted by tryan
Not in the northeast (US) .... 15% federal and 5% state taxes leave you with 32K; healthcare will run 1k/mo ; a studio apt with utilities another 1k/mo; forget the car you can't afford the insurance (1k/year) .... Leaves you about 5-6k to eat, cloth and entertain yourself for the year.
Not my idea of FIRE.
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Not even close. You just took away 20% of his total income. He will be in 15% bracket but won't pay anything close to your 20% overall even if every penny he pulled out was taxed as regular income. Don't forget the standard deduction and the initial 10% bracket.
Also, keep in mind 50% of his nest egg is already taxed. Since he says he just sold his house and we recently came out of a fall there are probably very few capital gains in that chunk of money right now. I'll bet he pays closer to 1.5%-4% on the taxed funds he withdraws initially, gradually increasing as the years go by.
__________________
Idleness is fatal only to the mediocre -- Albert Camus
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10-20-2006, 12:01 PM
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#17
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Full time employment: Posting here.
Join Date: Aug 2005
Posts: 945
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Re: Is $1million enough
If he wants to live WELL on $40,000 a year, I think Sorth Central America is a much better bet. Either Argentina or Ecuador (can really live well in Ecudor) or perhaps even Panama.
I think the key work here is "WELL" Of course this would necessitate learning a new language. But many do.
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10-20-2006, 12:22 PM
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#18
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Recycles dryer sheets
Join Date: Nov 2005
Posts: 355
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Re: Is $1million enough
Go for it. You will have to move away from where you made that kind of money. Spend some time looking for a low cost place to live. I want to live frugal near a warm beach until I get bored with it, then move on to whatever looks good. Both Panama and rural parts of the Southwestern US have a dollar denominated currency with English as a second language. Somewhere latitude meets elevation with your favorite weather. Medical care is most expensive in the US. Maintaining your good health is your next good investment. Choose a place that is conducive to healthy food and exercise. I liked a previous post about living within walking distance of a Super-Walmart (eye care, haircuts, and bank besides groceries and hardware). I would want proximity to a library. Plan B is to try ER and if you don't like it, you can go back to work doing anything until you are ready to retire. You are FI (financially independent) whether you stop working or not. If I read the 2006 Fairmark tables right, $40k income, Single filer with 8450 deduc & exemp, owes $4220 on 30,650 and $225 on the last 900. The effective rate is 11.1%, the marginal rate it 25%. As a US citizen you pay US income taxes regardless of where you live. Overseas income has different rules.
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10-20-2006, 01:05 PM
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#19
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Recycles dryer sheets
Join Date: Oct 2004
Posts: 214
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Re: Is $1million enough
On an old thread I proposed defining generic ER for a couple 50 yrs of age as $1MM liquid, plus cars and a house all paid for.
FWIW there weren't too many takers at that time though it still seems doable.
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10-20-2006, 02:01 PM
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#20
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Full time employment: Posting here.
Join Date: Jun 2004
Location: Calgary
Posts: 805
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Re: Is $1million enough
Quote:
Originally Posted by poyet
Brewer,
A couple of addition to what you've said from a EU standpoint (as you know I'm French). There are some cheap places to live in eastern europe, that's correct, but not any longer on the dalmatian coast or in croatia. Prices have gone up as it it undoubtedly very nice.
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Have to agree. My family is from Croatia and my remaining relatives there are constantly complaining how inflation (especially over the past couple of years) is taking its toll.
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I can only be nice to one person today! Today is not your day...tomorrow doesn't look good either.
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