+1 (or whatever the counter is at - sorry
)And by retiring I now have a chance to live long enough to hit the number. Granted I still may not make it that long!
one out of six retire a millionaire
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+1 (or whatever the counter is at - sorry
)And by retiring I now have a chance to live long enough to hit the number. Granted I still may not make it that long!
Dtail
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Yes, that could be a reference, but think about the other side of the equation when you have people who heavily practice LBYM. There wouldn't be any indication of a potentially high wealth.
Sojourner
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I quickly scanned the PDF, and it appears they counted home equity when coming up with these statistics, and that they are referring to households (as opposed to individual retirees). So, if a couple of married retirees has $750,000 in total, combined financial/savings/investment accounts and they live in a paid-off $250K house, then each of them would be counted in the "1 in 6 retirees is a millionaire" statistic. If that's a correct reading of the methodology used in the study, it's not quite so surprising that 83% of all retired people are "millionaires".
Major Tom
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It's interesting to know how much others have, but beware of playing the comparison game too much. The main thing that matters is how much you think you'll need in retirement, and whether your plan can produce that level of income. There is a fairly wide range of different lifestyles and income levels represented here so, while $1M might be ample for one person, it would be woefully inadequate for others. Then there are other income sources, such as SS and pensions, to take into account.
It's fun to be able to say to yourself, "I've got a cool million (or 2M, 5M etc) but what really matters, is whether you have the means to fund the lifestyle you want. I approached it from the other end. I reached the point where I decided that I didn't really want to work any more. I looked at my stash, figured out that I was comfortable with a 2 - 2.5% WR, and found a way to live on that amount.
I was happier not knowing
Sometimes it doesn't require Sherlockian powers of reasoning. When my parents went into memory care, I took over their finances and learned how much my two sisters had been draining from them for the past 20 years. Both DS1 and DS2 are stone broke.
Sometimes it doesn't require Sherlockian powers of reasoning. When my parents went into memory care, I took over their finances and learned how much my two sisters had been draining from them for the past 20 years. Both DS1 and DS2 are stone broke.
Beldar
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Yes, I think that is what is most important, not necessarily the $ level (although from a vanity POV it may be for some).
DW & I have reached the 7 figure level, but that was because of our LBYM lifestyle, not because of large earnings (at least IMO).
_B
But you didn't have access to a modern Corvette back then. The 57 vette accomplished its purpose in 1957 (picking up girls, beating other cars in races, cruising) as well or better than most other cars.
Today you need at least a modern Corvette to stand out from the other run of the mill cars (or you need a restored 1957 vette
)For the time period, the 1957 vette was a pretty good value compared to what was available, and a million dollars could buy quite a few of them.
HI Bill
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Many 'luxury' items cost more today. I bought some Klipsch speakers back in 1985 for $1,000. Inflation-adjusted, they should only cost $2500 for the new model today, but they're $3600. Cars, in particular, have become more complex, in terms of air bags, electronics, safety, and performance. The basic 1957 Ford truck probably had 1/5th the number of parts of a F150 today.
On the other hand, Oh, wait...maybe the official inflation index is rigged!
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HI Bill
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$1MM today, using the 4% rule, only throws off $40K in annual income. For most here, that's insufficient to retire, especially early. If you retire at the FRA for SS, and you live in a low cost area, it's likely almost enough. You are correct...most here retire with $2-3MM, minimum, and plan on taking out 3-4% annually.
HI Bill
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Yep, likely very much in debt, with no positive net worth! Everyone I know with large boats, large trucks, and fancy houses have one thing....lots of debt, and no retirement assets to speak of. They'll be working until they can't.
Exception: I do know a couple of folks that have all that, but don't work...they were very successful at FIRE! I could hazard a guess of their net worth ($5-10MM+ for one, $10MM+ for another)
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jollystomper
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It is not just debt. There are folks who are well off with no debt and could retire, but are still supporting parents and/or children. I can name close to a dozen co-workers who do not feel they can retire until their adult children are fully on their feet, or who are raising grandkids (in one case a great-grandkid). Some feel guilty that they are well off and their parents or children or not, and feel they should keep working to be able to provide needed support, instead of having a comfortable retirement but not able to provide support.
RISP
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This. I ran the numbers just for fun: The youngest millennials are now what, 18? By the time they turn 56, at an average historical US inflation rate of 3.27% (source), $1,000,000 will have the purchasing power of $282,700 today.
I will likely live to see that day. Hopefully as a multi-millionaire.
One million will not be what it used to be.Yes, comparing a car from 1957 to a current car is a poor comparison, because it's not the same product. A friend of mine bought a vintage, mid 1960s Benz, and we both agreed that our much more modern Toyotas were more comfortable, smoother, quieter, etc.
The Bacon, Potato, and Oranges is closer. Still probably not the exact same product but close, and probably a lot fresher.
Similarly, comparing medical costs doesn't work. Nobody was getting robotic surgery, MRI's etc. etc. Six decades of technology doesn't come cheaply.
As for the millennials being so optimistic about their financial future, as a boomer, I was too.
I remember well talking to my uncle about my plans to retire with several million dollars, by the time I was 55.
It didn't work out that way. I am not as wealthy as I anticipated, and I didn't retire until 62. But optimism, as long as it is accompanied by practical application, is a good thing.
I remember well talking to my uncle about my plans to retire with several million dollars, by the time I was 55.
It didn't work out that way. I am not as wealthy as I anticipated, and I didn't retire until 62. But optimism, as long as it is accompanied by practical application, is a good thing.
Jeb-NY
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Thanks to this group, the FIRE Calculator and mentor early in my career that suggested starting to save/invest early for retirement, I managed to retire at 57. I was financially ready at 55 but was enjoying work at the time and hung around an extra 2 years. I did my own investing most of my life, the one time I use an advisor I was smart enough to only give him $10k to start with and he ran it all the way to $5k and talked me out of some investments that went through the ceiling in the same time frame, so I dumped him. So here I am 12.5 years into retirement with about 50% more money than I retired with, no pension just my investments.
I went to two advisors before I took early retirement, both used the magic 4% rule and told me I didn't have enough money. When I pushed back they said I needed to plan on 110% of my current salary to retire early. I asked why when I was spending less than 50% now. They both said I was ready to retire and tried to sign me up to manage my money. I rolled most into Vanguard instead and still manage it myself with their advice from time to time.
So now we moved to a much cheaper state to live, costing about 75% of what we were spending in Western NY, with twice the house value. I have started RMD which is more than we spend a year and I start SS this month at age 70 which should be about what we spend a year. A large Roth just in case. We still live below our means because we always have, but we do buy what we want now. We just don't want many expensive things.
The one flaw in the 4% rule is you never spend principle, that is all well and good if you feel a real need to pass lots of money on to your kids. We told our son any money we left when we died was a miscalculation on our part. In truth we are not likely to spend it all and will probably end up leaving him more than I retired with.
I went to two advisors before I took early retirement, both used the magic 4% rule and told me I didn't have enough money. When I pushed back they said I needed to plan on 110% of my current salary to retire early. I asked why when I was spending less than 50% now. They both said I was ready to retire and tried to sign me up to manage my money. I rolled most into Vanguard instead and still manage it myself with their advice from time to time.
So now we moved to a much cheaper state to live, costing about 75% of what we were spending in Western NY, with twice the house value. I have started RMD which is more than we spend a year and I start SS this month at age 70 which should be about what we spend a year. A large Roth just in case. We still live below our means because we always have, but we do buy what we want now. We just don't want many expensive things.
The one flaw in the 4% rule is you never spend principle, that is all well and good if you feel a real need to pass lots of money on to your kids. We told our son any money we left when we died was a miscalculation on our part. In truth we are not likely to spend it all and will probably end up leaving him more than I retired with.
REWahoo
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Hey Jeb! Been a while since your last visit.
Glad to hear all is going well for you.
Glad to hear all is going well for you.
Jeb-NY
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Yep, I still check in once in awhile but not much to offer to most conversations so have kept mostly quiet.
Life is good.
Jeb...
Life is good.
Jeb...
Major Tom
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Hey, there is far more to life than the internet. Glad you're enjoying your life in the real world!
Yes, the average and the mean are defined as identical. The issue is that the average can be skewed wildly by a handful of bill gates retirements.
So the median value is preferred for such distributions, ie the middle number in the list from top to bottom (more typical than "average").
My comparison is between my grandfathers home, built for less than $4k; my fathers last mortgage, around $40k; and my house I recently sold for $500k. I expect in 20 years the dollar will sink enough that moderate homes will go for $4-5M.
Depends on where you live. Living in parts of Seattle, DC, Boston... it is easy to think that everyone has at least that much. A lot of old white folks did quite well. The Motley Fool had an article on the total extent of inherited wealth to be handed down by the dying baby boom, perhaps it was Morgan Housel. It is truly a pile. Looking for the reference...
