There is a misconception that in order to retire comfortably, it is critical to have at least $1 million in savings. However, this is a false narrative for the vast majority of retirees. According to CNN Money, spending for a typical household headed by a retirement-age person is less than $47,000 per year. Consider that work-related expenses, such as commuting, business attire, and income taxes will generally fall precipitously in retirement. Being retired also provides retirees the free time to work on household chores and projects that previously might have been farmed out to others, resulting in time and money saved. Since most individuals are able to cover a portion of their retirement expenses with social security or pension income, a million dollar investment account is not a prerequisite for financial security.
If you want to evaluate how much you’ll need in retirement, contact us. We have sophisticated modeling tools that will help determine how much money you need and how long your money will last.