all you need is ~600K by age 50 to retire

[Car-Guy]

Quote:

Originally Posted by audreyh1 I'm just shocked when people believe that major health issues are largely under people's control. Somewhat under people's control I think, but not largely.

+1 (Somewhat)

However, I think in many ways it's easy and under your control to wreck your health (by smoking or drinking to much, participating in risky activities, etc)

[Fedup]

Quote:

Originally Posted by audreyh1 That's going to prevent accidents or cancer? I'm just shocked when people believe that major health issues are largely under people's control. Somewhat under people's control I think, but not largely. I just know of too many individuals who have ended up in serious expensive medical conditions through no fault of their own. Nothing they could have done.

I agree. It's up to a point, food and diet do help but it's mostly genenetics and maybe randomness. My SIL's father was a vegetarian and never a junk food lover, died of lewd disease in his early 70s.

[evilanne]

Quote:

Originally Posted by masceratian This is for a family of two. if you can accumulate around 500-600K by age 50, that will help you survive for 17 years till age 67. From 67 you can start taking your full SS benefit; You get your amount (say 2600) and your non-working spouse gets 50% of that (1300) totaling 3900 per month. Since the medicare will take of your healthcare costs, 3900 will be good enough to survive for the rest of your life. So the absolute minimum you need to save by 50 to retire safely is 600K. For each later year you retire, you can reduce the 600K by 50K / year. Does this sound reasonable? Not saying we can retire with 600K at 50 as it depends on economy and its good to have some buffer, but if we want a number this sounds like the absolute min. needed - Sam

I have no issue with the $3,900/month ($46,800/yr) amount...I retired last year and living on ~ $40-$50K, including some added expenses from subsidizing my slow to launch 22 year old. It helps to have paid off house, reasonable healthcare premiums through employer and an emergency account for non-recurring expenses. I have not accessed anything in my retirement account yet.

My problem with the OP is the reliance on SS as the primary premise. It's 2017 now, 17 years from now would be 2034, when the solvency on SSA Trust Fund becomes questionable based on current estimates. When I started working I didn't expect SS to be available when I retired...it still may not be depending on when I begin benefits. The second issue is what happens if OP or spouse dies at age 62 or 67? OP's income would be reduced by 1/3rd and spouse's by 2/3rds at 62. Of course there would be some left in investments which might last for 5 more years until 67 with about a 20% reduction in withdrawal amount. Both would be below average for single person at 67 and the spouse would be right at or below the poverty level in most areas unless OP has adequate life insurance to make up the loss of his social security payments.

[Fermion]

SS will be there for the OP in 17 years or the USA won't be around.

[Fedup]

It may reduce to 70%.

[calmloki]

Quote:

Originally Posted by Fedup .... My SIL's father was a vegetarian and never a junk food lover, died of lewd disease in his early 70s.

Sorry to hear that. Probably kind of embarrassing for his family.

[rayinpenn]

We were on vacation somewhere in the south and we stopped into a super Walmart to buy some ingredients for dinner - I vividly remember that the cashier was a very old woman. The lines were long but she still moved slowly. When we got up to pay I saw that she really was the oldest cashier I had ever seen. Instant conclusion (and perhaps wrong) was she was too old to be doing this.

The optimist in me thought well maybe she just wants to work.
My darker side thought it is bad - doesn't have a dime to her name. Forced to work in the wrong job at the wrong time in her life - it must be very difficult. In the end I thought she is doing the best she can.

The average sixtysomething has an estimated $172,000 in the bank. So our 50 year old OP is doing quite well compared to his peers. The question is, at least in my mind, is it worth the risk of retiring early and ending up like the old cashier? For me clearly the answer was no.

And I guess I didn't find work all that bad...

[garyt]

Quote:

Originally Posted by Fermion The scary thing about this thread is that $600k by age 50 is actually far above what most of America has. If having $600k is doom and gloom, then we as a nation are heading for big trouble fast. I am not sure having $3 million is going to protect you against the mobs who don't even have $30,000. I guess time will tell.

Was just talking about this the other day. Everyone I know is lower middle class working people. None have anywhere near $600K and very few if any have pensions or healthcare in retirement. How are they going to make it?

[David1961]

My concern would be what happens if the markets crash and your $600k becomes $400k. Could you adjust your spending to accommodate that?

[rothlev]

Quote:

Originally Posted by Car-Guy If I were 50 and had accumulated 600k there is no way I'd even be considering retiring and living off of it until SS kicked in. Besides, unexpected expensive "stuff" can and probably will happen over the years between 50 and 65+. Sure it's great to retire early but at what lifestyle cost. Not even reasonably close to my idea of how I'd want to retire. Clearly, YMMV.

Most people who have accumulated that amount of wealth would NEVER consider letting it go down to 0 and then living off of social security. I wouldn't. It is doable if that is what you want to do.

That wasn't the OP's question. I really doubt that he would do it either. Most people, however have not accumulated that amount of wealth, live on that income throughout their lives, and to continue the same lifestyle in retirement is perfect. For the OP it would undoubtedly change his lifestyle significantly.

[1-31-18]

Quote:

Originally Posted by garyt Was just talking about this the other day. Everyone I know is lower middle class working people. None have anywhere near $600K and very few if any have pensions or healthcare in retirement. How are they going to make it?

It is very tempting to answer that question at length, but the protocols about political discussions on this board are chilling. So instead I'll mention the parable about grasshoppers and ants and will worry aloud that grasshoppers who vote outnumber ants who vote. I fear, as Bridgewater does, that political and social conflict, currently very high, will increase significantly as the entitlement crisis deepens.

[cooch96]

Quote:

Originally Posted by Turboslacker Most retirees actually live this way so yes you can. Simply depends on what lifestyle you prefer. Nothing wrong with living frugal to gain freedom.

+1.

Owning your own home before retirement could make this quite a comfortable lifestyle. you can go to Canada for affordable lasik and Mexico for quality dental work. There is still the risk of complicated medical issues. Try running FireCalc with a 90 or 80% success rate and see how much money that allows.

[jollystomper]

Quote:

Originally Posted by 1-31-18 It is very tempting to answer that question at length, but the protocols about political discussions on this board are chilling. So instead I'll mention the parable about grasshoppers and ants and will worry aloud that grasshoppers who vote outnumber ants who vote. I fear, as Bridgewater does, that political and social conflict, currently very high, will increase significantly as the entitlement crisis deepens.

+1000

[LRDave]

This has been a fun thread to read.


To the OP's original question (let me see if the basic premise is right - now 37 and hypothesizing that a $600K nut in 13 years is enough for two to RE - yes?):


I say that is a good target - hopefully realistic for you. Maybe you can even better that amount! So save like a mofo and see how things look at 50.


Having realistic goals is important. You can see from the range of responses that you are likely not terribly far off in terms of balancing RE time vs. financial risk.

[Scuba]

Quote:

Originally Posted by audreyh1 That's going to prevent accidents or cancer? I'm just shocked when people believe that major health issues are largely under people's control. Somewhat under people's control I think, but not largely. I just know of too many individuals who have ended up in serious expensive medical conditions through no fault of their own. Nothing they could have done.

+1

[Fedup]

Quote:

Originally Posted by calmloki Sorry to hear that. Probably kind of embarrassing for his family.

No the whole family is vegetarian. And my other BIL from my husband's side developed diabetes because of his vegetarian diet.

[razztazz]

Quote:

Originally Posted by 1-31-18 It is very tempting to answer that question at length, but the protocols about political discussions on this board are chilling. So instead I'll mention the parable about grasshoppers and ants and will worry aloud that grasshoppers who vote outnumber ants who vote. I fear, as Bridgewater does, that political and social conflict, currently very high, will increase significantly as the entitlement crisis deepens.

If things keep going in their current direction we have nothing to fear

[Fedup]

Quote:

Originally Posted by garyt Was just talking about this the other day. Everyone I know is lower middle class working people. None have anywhere near $600K and very few if any have pensions or healthcare in retirement. How are they going to make it?

Interesting. In my circle, most people have a lot more and they are still working. They will retire in the earliest is 65, some will retire at 70. Even my old secretary has this at least much in pension, a house paid off and she still doesn't plan to retire. She is already 66 and single.

[Fermion]

Fedup, do you think being in SoCal might have something to do with the people in your circle?

[Scuba]

Quote:

Originally Posted by garyt Was just talking about this the other day. Everyone I know is lower middle class working people. None have anywhere near $600K and very few if any have pensions or healthcare in retirement. How are they going to make it?

They'll work until they can't anymore and then they'll live as best they can on what they have. Maybe it won't be too drastic of a lifestyle difference vs when they were working.

I think much of the divergence of opinions on this thread can be traced back to what lifestyle one was accustomed to pre-ER. If one lived on $50K or less pre-ER, then it's easy to envision how the OP could be comfortable on $3,900/month. If one lives in a HCOL area in a nice home with high property and income taxes, and is accustomed to dining out frequently at nice places, eating high-end food at home, getting great seats at live performances, and traveling globally to somewhat costly destinations, $3,900 sounds like far less than required to provide the desired lifestyle.

It also depends how risk averse one is. As others have said, healthcare costs and events are a major uncertainty. Many of us feel the need to have a substantial cushion set aside for increasing health insurance premiums, copays, and/or LTC. Spending a portfolio of any size down to zero and then relying on SS & Medicare to cover this is beyond many people's risk tolerance.

YMMV