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Possible To Retire On $600,000?
Old 05-08-2008, 09:06 PM   #1
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Possible To Retire On $600,000?

Hi, would like very much your thoughts. I'm 50, single, no kids, no debt except $14K on mortgage. Have $600,000 in savings in the form of my 401(k). Wondering if it's feasible to retire and live off these funds.My overhead is low, just need around $2,000 month,which takes care of apartment maintenance, utilities, healthcare insurance. Thanks for your advice.
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Old 05-08-2008, 09:09 PM   #2
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Yes, if your $2000 per month expenses are before taxes.

Welcome to the board. You may want to read the FAQs, and look at FIRECalc to help sort things out. Rule of thumb suggests that if you play it right, you need about 25x your annual expenses to come out OK.
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Old 05-08-2008, 09:11 PM   #3
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I suggest you run your numbers through firecalc, paying close attention to inflation and how your funds are invested.
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Old 05-08-2008, 09:15 PM   #4
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Yes. But if the market has a hard time... You have a hard time. The nest egg you have is really close to not having to work at all anymore for wages. Is there some way to boost it a bit and or do part-time work? I would want a little more cushion myself. Check out Firecalc here and Welcome to 72t on the Net those two are the best around to do the what if scenarios with.

I also pulled the plug at 50 and understand the desire to move on.
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Old 05-08-2008, 09:17 PM   #5
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Do you have any pension coming later? Qualify for SS? What will you do for health insurance?
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Old 05-08-2008, 09:18 PM   #6
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There is no way. Keep working or move to the Ozarks. You think it is $2k but you have not considered all your costs.
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Old 05-08-2008, 10:04 PM   #7
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There is no way. Keep working or move to the Ozarks. You think it is $2k but you have not considered all your costs.
kcowan, do you know the OP personally? How do you know he hasn't considered all his costs?

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Old 05-08-2008, 10:11 PM   #8
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Sounds like it would work. In tweleve years you will have some SS. Can you make it in New Jersey on 2k a month? We can do it but we are in the midwest.
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Old 05-08-2008, 10:33 PM   #9
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Hi, would like very much your thoughts. I'm 50, single, no kids, no debt except $14K on mortgage. Have $600,000 in savings in the form of my 401(k). Wondering if it's feasible to retire and live off these funds.My overhead is low, just need around $2,000 month,which takes care of apartment maintenance, utilities, healthcare insurance. Thanks for your advice.

check out boglehead ..there is a guy there that retired on that amount. He grew his 600000 to 1.4 mil in 10years
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Old 05-08-2008, 10:57 PM   #10
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Go for it. Heck you might die well before you blow all of that. Just remember most people think they will live to 120.
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Old 05-08-2008, 11:14 PM   #11
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perfect for oversea deal.
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Old 05-09-2008, 02:05 AM   #12
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I'm about your age and have around the same amount in my retirement account but I am married. If I were single and have no mortgage, I think I could live off that money plus my projected SS income of $1300/mo in 7 years. Yes, I live in LA.
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Old 05-09-2008, 02:12 AM   #13
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Of course it all depends on your projected expenses including health care which is increasing at a rate faster than normal inflation.

600k at 4% wold yield the 2k/mo.. but I think you have underestimated your expenses.

IMHO - You need to work a few more years. Sock away a little more money and get closer (in age) to SS and any pensions you hopefully have available. In your situation, I would set a target of $1MM, and a house (that is in good shape) paid off. Perhaps you could set a goal between 55 and 59.
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Old 05-09-2008, 02:34 AM   #14
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You need to consider the following if you haven't already:

Is $2K a month your post-retirement budget or your pre-retirement budget? They could be the same, but they could be different. If you post your post-retirement budget here it might help. Did you factor in large ticket items like car purchases, root canals, purchase of a dog, etc?

What do you plan on doing after retirement that you didn't do pre-retirement? Will it cost more? $2K a month may not leave enough wiggle room for travel and entertainment, although you might be doing activities that don't cost much like walking in the park, reading at the library, riding your bike.
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Old 05-09-2008, 06:16 AM   #15
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Quote:
Originally Posted by Marcretire View Post
Hi, would like very much your thoughts. I'm 50, single, no kids, no debt except $14K on mortgage. Have $600,000 in savings in the form of my 401(k). Wondering if it's feasible to retire and live off these funds.My overhead is low, just need around $2,000 month,which takes care of apartment maintenance, utilities, healthcare insurance. Thanks for your advice.
Looks like it could work, but I'll ask the question that others are being more subtle about: How much are you budgeting per month for health care?
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Old 05-09-2008, 06:48 AM   #16
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You need to consider the following if you haven't already:

Is $2K a month your post-retirement budget or your pre-retirement budget? They could be the same, but they could be different. If you post your post-retirement budget here it might help. Did you factor in large ticket items like car purchases, root canals, purchase of a dog, etc?

What do you plan on doing after retirement that you didn't do pre-retirement? Will it cost more? $2K a month may not leave enough wiggle room for travel and entertainment, although you might be doing activities that don't cost much like walking in the park, reading at the library, riding your bike.
Thanks, everyone, for your replies. What is accelerating my desire to retire is the industry I've worked in is in a state of collapse and I'm finding age an impediment in my job search (sales). I'm in excellent health and don't foresee significant healthcare costs, although I know there's no guarantee of good health. The only other added future expense would be a new car. I'm pretty much living on a couple thousand a month pre-retirement. I'll weigh everyone's advice.
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Old 05-09-2008, 07:45 AM   #17
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Originally Posted by retire@40 View Post
You need to consider the following if you haven't already:

Is $2K a month your post-retirement budget or your pre-retirement budget? They could be the same, but they could be different. If you post your post-retirement budget here it might help. Did you factor in large ticket items like car purchases, root canals, purchase of a dog, etc?
Yup, similar expenses for me just in the last few days. As discussed in another thread, had a new crown installed yesterday and my dog will have surgery next week. Poor baby might even need some treatments afterward. So you need to budget for the unexpected.
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Old 05-09-2008, 08:33 AM   #18
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I'm in excellent health and don't foresee significant healthcare costs, although I know there's no guarantee of good health. The only other added future expense would be a new car.
On that budget, I would suggest a used car
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Old 05-09-2008, 08:44 AM   #19
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Old 05-09-2008, 08:57 AM   #20
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You might consider working for a few more years. Your health insurance premiums will be going up and your body (more than likely) will require more visits to the doctor--so, depending on your policy, there could be more co-payments and the meeting of deductibles. I don't know if you have dental insurance, but if you need a crown or two, it's going to throw your budget way off.

The other thing, when I'm retired, I don't want to be anxiously thinking about money. I want to be able to spend on the stuff I want or need without agonizing. I don't think $600,000 will do it in a comfortable manner.
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