Interesting study by northwestern mutual

[BlessedLife224]

Early retirement /(aspirees) are likely having the last laugh.

The New Magic Number for Retirement Is $1.46 Million. Here’s What It Tells Us.

https://www.wsj.com/personal-finance/retirement/retirement-savings-needed-increased-2024-9f7c01e0


Americans Believe They Will Need $1.46 Million to Retire Comfortably According to Northwestern Mutual 2024 Planning & Progress Study

https://www.prnewswire.com/news-releases/americans-believe-they-will-need-1-46-million-to-retire-comfortably-according-to-northwestern-mutual-2024-planning--progress-study-302104912.html

 

[DrRoy]

We could live on that but not freely do all the things that we enjoy.

 

[old medic]

I'm retired and we have nowhere near that kind of money

 

[Car-Guy]

From my POV, 1.46m is probably okay if you have no debt and are over 70. Not so much for those with significant debt and under 65.

 

[LateToFIRE]

I'm retired and have we have nowhere near that kind of money

From my POV, 1.46m is probably fine if you have no debt and are over 70. Not so much for those with significant debt and under 65.

LMAO - so who's right?

 

[Gumby]

Like many things in life, one size does not fit all. However you define "enough" is what you should have. My guess is that a very large number of those saying $1.46 million don't have that much and never will. But they'll still retire anyway.

 

[Samething]

Being single and 63 I could make that work. But my sleep at night factor would be affected. That would leave no wiggle room in my budget at my current lifestyle. Probably would have to take SS earlier than I want to.

 

[Car-Guy]

LMAO - so who's right?

As I said, from my POV. Of course the big factor is desired lifestyle.

 

[Taco]

Pension or not?
HCOL or LCOL?
House paid off or not?
55 or 65 years old?
Etc.

One size (number) obviously does not fit all.

 

[CaliKid]

LMAO - so who's right?

It depends. Some people don't have a lot of money in the bank but they have a pension and live in a low cost of living location. Other people have a ton of money but no pension and live in a VHCOL place. Apples and oranges.

 

[mathjak107]

the age old question of how much is enough is like asking how long is a rope .

the answer is people make whatever they have work .

it may be in a location or a lifestyle they don’t like , but they make it work .

some may even have to golden girl it

 

[Out of Steam]

In most places, it seems like a reasonable number with no pension and no big mortgage. $58K income at 4% draw, plus ~$48K a year in combined Social Security.

According to this article, it's significantly above both the median and the average for retirees age 65-69.

https://www.msn.com/en-us/money/ret...65-to-75-plus-how-do-you-stack-up/ar-AA1mslJo

It also meets the test I remember my parents talking about before retiring in the 1980s of being able to match one's Social Security income from other sources.

 

[DJRR]

From the statistics that I found:

Median wage in Q4 2023 - $59,540
4% wdr on $1.46M - $58,400 for a 30 year period

So that seems about right for 1/2 the working population. Social Security is designed to replace <= 40% of your income, so if the goal is to replace your income to maintain your lifestyle you probably pick up another large % of the working population or can make do with < $1.46M.

If you make well above the medium, and want to spend it, then of course you will need more.

 

[Out of Steam]

Being single and 63 I could make that work. But my sleep at night factor would be affected. That would leave no wiggle room in my budget at my current lifestyle. Probably would have to take SS earlier than I want to.

I'll take Social Security next year, shortly before turning 66, which is sooner than I thought I would. But, in addition to delay starting to limit our lifestyle, our decision not to seek LTC insurance suggests that we should reduce our retirement account draws.

 

[MarieIG]

Like many things in life, one size does not fit all. However you define "enough" is what you should have. My guess is that a very large number of those saying $1.46 million don't have that much and never will. But they'll still retire anyway.

That was a very reasonable deduction.

Pension or not?
HCOL or LCOL?
House paid off or not?
55 or 65 years old?
Etc.

One size (number) obviously does not fit all.

Agreed.

 

[TheWizard]

If a company is going to play this One Size game, they might as well specify the amount of income the average retiree needs, perhaps $80k filing Single and $120k MFJ.

And then leave it to the individual to cobble together that amount of income from various sources...

 

[mathjak107]

If a company is going to play this One Size game, they might as well specify the amount of income the average retiree needs, perhaps $80k filing Single and $120k MFJ.

And then leave it to the individual to cobble together that amount of income from various sources...

but then location matters the most.

some of this how much do i need is like trying to predict what our after tax income is by taking the average effective tax bracket of the country and applying it to my projections.

you can be way off depending on individual circumstances

 

[pb4uski]

Like many things in life, one size does not fit all. However you define "enough" is what you should have. My guess is that a very large number of those saying $1.46 million don't have that much and never will. But they'll still retire anyway.

My frugal friend from high school retired last year. He lives simply, is frugal bordering on cheap and owns a duplex that he lives in one unit and rents out the other unit. Between ~$11k a year of rental income from the duplex and SS he is still banking money and hasn't touched his modest retirement nestegg which is low six-figures.

It all depends on how much you spend.

While I'm glad that we don't need to live on SS alone and I think everyone should have some retirement savings, we could if we had to.

 

[OldShooter]

... According to Northwestern Mutual 2024 Planning & Progress Study ...

Hmm ... and what would NML's objective be in publicizing this study? My guess is annuity sales. Companies are not motivated by charity in sponsoring and publicizing studies like this.

The study results can be managed, too. "4,588 adults" ?? How selected? What were the questions and how were they delivered? Who conducted the survey?

I pay no attention to this kind of thing. Too much likelihood of ulterior motives and manipulation.

 

[Andre1969]

$1.46M would give you somewhere between $43-58K per year, assuming you pick a SWR 3-4%. The last time I checked, my SS is around $20K/yr, if I take it at 62.

I could probably feel comfortable on $1.46M, if I was already 62 and drawing SS. But, at the age of 54, I'd definitely be cutting it close. If I had the house paid free and clear, maybe.

 

[Andre1969]

Like many things in life, one size does not fit all. However you define "enough" is what you should have. My guess is that a very large number of those saying $1.46 million don't have that much and never will. But they'll still retire anyway.

I'm guessing nobody at all actually said $1.46M. That number's probably just a mean. Or median, at best.

 

[brett]

At one time I used to read those reports.

Now, I find them completely meaningless. So much depends on where you live, how you live, what your retirement aspirations are.

About the only value that I see in them is that it will make some people think about retirement and more specifically retirement financials.

 

[statsman]

I'm assuming the $1.46M excludes whatever is tied up in home and property equity?

 

[BlessedLife224]

Speaking of which, is there an existing thread or survey results on the forum with information such as net investments at retirement, retirement age, and annual expenses, and COLA? Just curious and want to compare notes.

 

[MichaelB]

Speaking of which, is there an existing thread or survey results on the forum with information such as net investments at retirement, retirement age, and annual expenses, and COLA? Just curious and want to compare notes.

There are quite a few. Try the search function and look for terms like portfolio, or budget in the title line.