First million is enough

[Chuckanut]

Helping people from time to time with their retirement investments has been an eye opener. One is how badly prepared many people are for retirement. I have met people who inherited $200,000, which is all they have, who think they can retire and continue to live at the level they had when working full time.

OTOH, I have seen how the tax breaks and aid for low-income seniors can really help lower income retired people.

 

[ncbill]

I'm in the sub-million club when I retired in 2014. It helps to have free and clear housing and car, a waiting frozen pension and decent Social Security. Income low enough to get $0 health coverage and pay hardly any income taxes. Spending is a bit above the Federal Poverty Level.

May you enjoy many more years of retirement!

Like a close relative who retired with a modest (but COLA) pension, paid-off house, & essentially free retiree health care until Medicare.

But they probably had under $100k in total savings when they retired back in early 1994.

Yup, they are now 30 years retired!

 

[SunGuy]

My parents have about 2MM and still stand to inherit around $250k++, their yearly spend is les than $2k a month, unless they do group parties or things with other people, they are doing great

 

[Rianne]

My parents have about 2MM and still stand to inherit around $250k++, their yearly spend is les than $2k a month, unless they do group parties or things with other people, they are doing great

Now that's impressive! How do they spend less than $2K/month? $24K/year. Were they a case study in the book "The Millionaire Next Door?"

 

[Car-Guy]

Now that's impressive! How do they spend less than $2K/month? $24K/year. Were they a case study in the book "The Millionaire Next Door?"

I don't see how that is possible these days unless you don't use power or water or phones and carry the minimums on car and home and health insurance.

My dad was millionaire but epitomized the LBYM lifestyle and still spent ~35k+ a year in an average cost of living area.

 

[jim584672]

I don't see how that is possible these days unless you don't use power or water or phones and carry the minimums on car and home and health insurance.

My dad was millionaire but epitomized the LBYM lifestyle and still spent ~35k+ a year.

I have been around $16K a year for years. Health insurance $0 (Essential Plan, previously Medicaid), phone $0 (Lifeline), electric $12 a month (Assistance Rate), Internet $0 300/300 (ACP), food about $170 a month, car insurance $300K/$300K, gasoline minimal (mostly walk now).

 

[Car-Guy]

I have been around $16K a year for years. Health insurance $0 (Essential Plan, previously Medicaid), phone $0 (Lifeline), electric $12 a month (Assistance Rate), Internet $0 300/300 (ACP), food about $170 a month, car insurance $300K/$300K, gasoline minimal (mostly walk now).

That is just beyond my comprehension. I'm closer to 16k a month (with hobby cost) and that estimate may be a little low. We just went grocery shopping yesterday (for a two week supply) and that was ~$400 which equals $800 mo. And my gasoline bill averages over $700mo. Even more if I take any long trips. Of course walking here is out of the question. Nearest signs of civilization (to buy stuff) is ~15 miles away.

 

[street]

^ I know many people that live on 24 to 30K a year. All in fly over country and don't owe anyone anything. Live life simple and their life is filled with the outdoors and are as happy as a lark.

 

[Car-Guy]

^^^^
I get "living in the country". Love it too...I guess I'm just out of touch and addicted to "expensive taste and activities".

 

[wearefinishedworking]

Our annual property tax bill on our paid off house if $6000, so $500 a month before anything else. Add in utilities, home and auto insurance, food, gasoline, it is hard to imaging someone spending only $2k per month.

 

[Ronstar]

^ I know many people that live on 24 to 30K a year. All in fly over country and don't owe anyone anything. Live life simple and their life is filled with the outdoors and are as happy as a lark.

95 yo MIL lives on $30k a year which includes $790 per month rent, $435 health insurances. Close to 0 discretionary spending. No car.

Seems to me the only way to live cheaper than her is to live in a paid off house with no add’l health insurance and maybe grow your own food .

ETA - I forgot that her checking acct balance grows a few k per year, so she's spending around $27k per year.

 

[street]

95 yo MIL lives on $30k a year which includes $790 per month rent, $435 health insurances. Close to 0 discretionary spending. No car.

Seems to me the only way to live cheaper than her is to live in a paid off house with no add’l health insurance and maybe grow your own food .

These people have paid off homes and have property taxes, but they are under 1600$ a year. Burn wood and have very little in utility bills.

 

[razztazz]

I have been around $16K a year for years. Health insurance $0 (Essential Plan, previously Medicaid), phone $0 (Lifeline), electric $12 a month (Assistance Rate), Internet $0 300/300 (ACP), food about $170 a month, car insurance $300K/$300K, gasoline minimal (mostly walk now).

Just checked. I've hovered right around $16,000 - $17,00 per year core expenses except for about 10 yrs ago my books show 3 yrs at $19,000-$20,000. Have no idea why those years showed an uptick?

Even the year I had the house sided + some other work I only got up to $26,000.

 

[scrabbler1]

I have been around $16K a year for years. Health insurance $0 (Essential Plan, previously Medicaid), phone $0 (Lifeline), electric $12 a month (Assistance Rate), Internet $0 300/300 (ACP), food about $170 a month, car insurance $300K/$300K, gasoline minimal (mostly walk now).

Now that I'm on the NY Essential Plan, my annual expenses will drop to about $20k. I still paid monthly HI premiums for Jan-March, and I have dental bills (my current dentist is not in-network, and I don't plan to change dentists) and minimal copays.

My monthly surplus of bond-fund-dividend over expenses has grown by about $400 a month thanks to the HI change. Still, Jim's $16k annual expenses seem mind-boggling although not as boggling as it was before.

 

[Al18]

This discussion seemed to get diverted. If you have at least a million in investable assets, why would you choose to live on 16K to 30K per year?

 

[REIJM]

I just wanted to drop in to say that I appreciate this thread, and it's interesting to see the input from many members here.

My wife and I will turn 35 this year, and would like to retire at 46. The current projection is to have ~$5M at that point, and while my spreadsheet says it'll work out fine (and FIREcalc says it has a 97.4% chance of working), it's always good to hear the testimonials from those who did RE, how much they retired with, and how things have gone (and are projected to go).

 

[Koolau]

Now that's impressive! How do they spend less than $2K/month? $24K/year. Were they a case study in the book "The Millionaire Next Door?"

We spend a ton more than this, but realistically, if I moved back to my summer rental, I could probably just about live on $24K - not that I would or that I would want to.

MONTHLY
Rent $500 (includes utilities)
Car - Gas,tags,insurance, maintenance, repairs, replacement - been running less than $250
Food $400 (could be less)
Phone $50
Cable/internet $150
Health Care - (with help from Megacorp) - $325
Clothing - $50
Personal care - $50
Misc. - $100
Dental - $100
Taxes - 0

Total - $1975 (call it $2000)

That means I'd drop all life insurance, stop making charity donations, give up any significant travel, never eat out, skimp on dental care, etc.

 

[scrabbler1]

This discussion seemed to get diverted. If you have at least a million in investable assets, why would you choose to live on 16K to 30K per year?

I can't speak for Jim, but in my case I am living pretty much the same way I have lived before I retired, when my portfolio was smaller, and when I was working full-time, when my portfolio was much smaller. I didn't just instantly start BTD as my portfolio rose.

As I have written here many times, one unbreakable condition for ERing was that there would be no change to my everyday lifestyle. This didn't mean I would start spending more, either, if my portfolio rose. It also means I wouldn't start living differently just because I became eligible for the low-cost NY Essential Plan through no fault of mine.

 

[jim584672]

Now that I'm on the NY Essential Plan, my annual expenses will drop to about $20k. I still paid monthly HI premiums for Jan-March, and I have dental bills (my current dentist is not in-network, and I don't plan to change dentists) and minimal copays.

My monthly surplus of bond-fund-dividend over expenses has grown by about $400 a month thanks to the HI change. Still, Jim's $16k annual expenses seem mind-boggling although not as boggling as it was before.

The ACP expiring will bump Internet up $30. When I hit 60 I can get a $23 SNAP benefit with income under $30K, that will also get the electric discount and the phone. At 65 we get the Senior discount on property taxes, and if income is low enough the Senior low income discount. The pension will put me over but there is always a lump sum option to consider.

 

[razztazz]

This discussion seemed to get diverted. If you have at least a million in investable assets, why would you choose to live on 16K to 30K per year?

In my case I do not "choose" a number, I just spend what I need and I guess I don't need much. Grew up with not much constantly hearing grown-ups in constant fear of "What are we gonna do if (almost anything) happens! "We can't AFFOOOOORD IT! But all the while bitching about standard of living. Psycho-economics. I already know how to be happy or at least content with what I have. I don't need to spend any more than necessary. It won't make me happy. re The two Greek Philosophers story.

Secondly, I don't believe the meme that you spend so much less as you get older. You do until you need to spend it all in a short time frame on aides and maids and therapists and nurses. So, while I could up-crease my standard of living now, 20 years from now I might not have the financial mega-tonnage I'll need to avoid living miserably impoverished followed by dying miserably impoverished.

 

[Koolau]

In my case I do not "choose" a number, I just spend what I need and I guess I don't need much. Grew up with not much constantly hearing grown-ups in constant fear of "What are we gonna do if (almost anything) happens! "We can't AFFOOOOORD IT! But all the while bitching about standard of living. Psycho-economics. I already know how to be happy or at least content with what I have. I don't need to spend any more than necessary. It won't make me happy. re The two Greek Philosophers story.

Secondly, I don't believe the meme that you spend so much less as you get older. You do until you need to spend it all in a short time frame on aides and maids and therapists and nurses. So, while I could up-crease my standard of living now, 20 years from now I might not have the financial mega-tonnage I'll need to avoid living miserably impoverished followed by dying miserably impoverished.

Folks like my parents who lived through the Great Depression were often like this. I consider that I have "enough" but always wonder about the end days and what that might be like without significant reserves. YMMV

 

[Al18]

According to the SS Administration, the average retirement benefit is $1907 per month in January, 2024. For a married couple, the average benefit is $45768 per year. If you have no kids, why would you spend less than the SS benefit?

 

[Car-Guy]

Psycho-economics. I already know how to be happy or at least content with what I have.

Not me. And now it's too late to teach this old dog new tricks.

I don't need to spend any more than necessary.

I do... And often...

It won't make me happy.

It does buy me happiness. Like the song says, "There ain't no such thing as too much fun."

Secondly, I don't believe the meme that you spend so much less as you get older.

That's true for the most part. But I find I spend on different things. YMMV

I'll need to avoid living miserably impoverished followed by dying miserably impoverished.

+1

 

[Jerry1]

Now that Robbie is gone, Car-Guy will have to be the new BTD guy around here.

While I would like to think I could make anything work, I'm glad I'm not looking at trying to live on a shoe string. Thankfully, my pension and SS (me and DW) comes to about $8K a month and that pretty much covers all our expenses (necessary and discretionary). Necessary expenses are closer to $50K/year and I could probably shave some off that if things got really crazy. Certainly hoping they don't.

 

[Car-Guy]

^^^^
No wonder why I always liked RobbieB.