I'm 60 with $1M, Can I Retire?
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- Опубликовано: 30 май 2024
- How much do you need to retire? If you have saved and invested well for many years, you may be in a strong position to retire. It's one thing to be able to retire, but it's another to feel confident going into retirement. In this video, you'll learn what you need so you can feel confident in creating a secure retirement.
⏰ TIMESTAMPS
00:00 - Introduction
:44 - Types of Companies
2:00 - How Much Do You Think You Need?
3:54 - Approaching Retirement Differently
5:08 - Uncertainty & Positives Outcome
7:13 - Your Investment Portfolio
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As a couple retiring at 60, $1.5 million portfolio is what we believed we needed, along with an emergency bucket of $250k and no debts whatsoever.
Did you work backwards from your expenses to get that number or did you use a different method?
@@RootFP very simple approach was used. i estimated my expenses and added a buffer to come to a need for $75k/year. With a 5% withdraw rate from 60 to 70 adjusted with inflation if need be, I estimate that we will end up at 70 years with more or less the same amount in my portfolio with an estimated 6% return after fees. At 71, my withdraw rate should be reduced by ~ half as we will start collecting social security.
Well that would be impossible to do considering I'm in my late 40s and I'm retiring at 55. I already told my husband . my father in law retired at 67, he thinks I'm a lazy sob for my goal of retiring at 55. I'm more interested in investments that could set me up for retirement in my 60s, my goal is at least $ 2 million.
If I received 1M today, I'd retire immediately putting less than 700,000 in a combo of JEPI and RYLD creating a dividend income of over 7,000 per month. I'd pay off my debt and have fun with the other 300,000.
Since even with inflation my current living expenses are less that 4800 per month, I'd use the rest of my monthly income to diversity my portfolio.
saved this one to revisit, great food for thought
Glad to hear it was helpful!
Great analysis Conole!
-Matt Smith
Thank you!
Just Retired at 59, wife 56. Needs -100,000 per year till 70. Have a good 35 years in SS. Delaying SS till 70. Wife will take at 67. Have a pension I could take at 65 at 2300 a month or if I defer till 70 it would double to 4600.
As you say Section 1, have enough cash to get to 70, Section 2, the rest of retirement portfolio will covert to Roth during my 60s while I delay SS and pension. Section 3, at 70 have projected to have about 120,000 per year at 70. With Roth accounts pull as needed tax free... No IRRMA, No RMDs, No secure act inheritance distributions except getting 10 years to grow Roth money.
How’s my plan James?
You've skillfully articulated the exact strategy that I've been embarking upon for the past few years--thanks for the confirmation of the logic being employed! 🙌🏻
Great!
At 60 now, I think I will need 1.5 million. Pluss SS. Most of the males in my family dont live past 75 YOA. I live on $35 K now. 1.5 million gives me a large enough cushion for down markets and still have enough to continue my life style in the case I live much longer than 75 years old.
Glad it was helpful!
Section 3 would be a good place for your Roths. I liked the visual. Thanks.
This is an interesting video for people who are retiring early. I'm wondering if you can present value the later social security benefits and then take say 4% of the portfolio and PV benefits to determine if it will provide the necessary income?
So this is an interesting concept. If I understand it and using my situation. I am almost 68. I am currently working two side gigs to supplement my wife's income and what we need to draw from my retirement accounts. That is section #1 and I need to have about $4K/ mo net income. That would be my first section.
Then I will have a new section. I will take SS when I am 70 @ about $4K / mo and my side gigs stop. So, the 2nd section needs to fill the income requirements until that segment duration ends. That will likely be when my wife retires in about 8 years. At that point the 3rd section would begin with a time horizon of about 10 years from now.
So the 1st section would be in, as an example, money market and CDs for security and liquidity. While the second section would be in 60/40 equities/bonds as an example and the 3rd section would be 80/20 equities/bonds? Do you replenish each section as you approach the event horizon or after it has arrived?
Wow, I am not even sure I know enough to ask good questions.
Great video. I always assumed we would need/want 2.5 million and be able to draw off about 100K a year by the 4% rule. We have refined that a lot due to pension and SSA being such a huge part of our equation. It is true that now with retirement at the jumping off point in a few years that the money we have accumulated will be pieced in as needed to make up any shortfalls until all the other sources kick in. That 100K is mostly provided by Pension and investments early on at 55 but within 12 years Another smaller pension and two social security checks alleviate all the pressure on our savings and will probably allow us to live out the rest of our years without touching our savings again for anything but "fun" or for passing on to children. Thanks for the video.
I’m glad you liked it!
I think if you can afford it, you should shoot for double what you think you will need and if you don’t make it, you’ll be ok and if you do make it you can give big. In my case 4-5 million is a good goal.
The title made me think you were doing this video just for me. I will completely retire in 4 years at age 60 with a little over the amount referenced. My wife has a paltry pension from her job working in schools that may fill up out gas tanks each month. She will quit working at 56, the same year I retire. I will have 2 pensions as I have pulled off two full careers by working part time at one while full-time at the other until I retired from the first full-time job. I then made my part time job the full-time one and will make almost a second full pension. The pensions will more than cover me, but if something happens, my wife gets very little of that. The portfolio is her insurance policy in effect so that she can maintain the lifestyle she is used to should I pass first. I plan to hold out on drawing SS until 67, but when that kicks in, I have already predicted exactly what you were talking about. Not to mention our expenses for things other than health care will decrease as we move into our mid 70s due to activity level predicably slowing. Thanks for all your great content!
At 60, we estimate we will have 1.2 million in financial investments , a lifetime pension of $5,500 a month, no debt, & 2 proprieties owned outright. So the sale of our house (approx $500,000) will be added to our portfolio & we'll move into our condo. My wife will retire at 58, & I will retire at 60.
Being debt-free in retirement gives people more 'belt-tightening' flexibility when the market is down. They can lower their withdrawal rate during the rough times more easily if they don't have to make monthly payments on debt (credit card interest, car payments, mortgages, etc.). This makes them less likely to suffer from sequence of withdrawal risk and go broke in old age.
I need 1.8 million at 60 but would like 2.2m. I am 52 and have 1.46. I will have one pension at 62 and one at 65. So far so good.
Nicely done!
Expenses go down later in life (section 3)even with cost of living because you don't do near as much when you are 80 and medical covers much of your healthcare. So the expenses curve would start on way down towards the end IMO. Great video.
Glad it was helpful!
The median retirement savings for a 60-year-old is 70K. Scary.
Too many people are under saved unfortunately
If these kids don't listen to me, they are going to be living in a van DOWN BY THE RIVER!
Perhaps the best explanation of this concept I have seen. Almost makes me think I know what I am doing. Retired three months ago at 60, small pension and no debt. 1m + with house payed for. Really should have worked few more years but had other responsibilities at home. Still unsure of path forward but this video gave me at least a little peace of mind. Thanks
Thanks Paul!
You will be able to draw SS at 62 or 67 depending on your needs. Remember you can't buy time. Working longer may not actually buy you more security. Look what happened in 2022. Markets went down and continue to go down.
Hi, James. I retired in 2017 at age 53 with a portfolio mix of 80/20 stock/bonds. I've added a bit of cash reserves to my portfolio since retirement and currently sit at about 78/17/5 stock/bonds/cash. In my years of research and strategizing before retirement, I never factored SS into my retirement income. I felt more comfortable looking at things from a worst-case scenario and only using income I could truly control and count on. However at this point, I'm thinking I may want to factor in some SS and see if I can spend a bit more now and enjoy a little higher quality of life in these "prime" retirement years. (More travel, dining out, etc.) I've been living on just under 4% of my portfolio value per year, and my portfolio has grown significantly since 2017. Even with the market instability over the past couple of years, my portfolio is still up quite a bit.
I recently watched a video by your business partner Ari and he mentioned that he often does not include any SS income with his clients when looking at their future retirement picture. I'm thinking some of his clients could be much younger and just starting out on their investment journeys?
I know nobody has a crystal ball and that we live in uncertain times. What is your opinion on SS and the chances of it being something a person like myself can feel relatively comfortable factoring in to their retirement income picture?
Thanks for producing such helpful, relevant and easy-to-understand content.
I generally plan on social security being there for people unless they are a long way away from being eligible and would prefer to be more conservative in their projections
I am retiring next year. I have 1.5 million, $200,000 in laddered CD's and the rest in diversified stock mutual funds. We are also 100% debt free including the house. I will receive about $65,000 in a pension and intend to draw $60,000 per year. The CD's are to supplement drawing from the portfolio during downturns. This will be a significant raise in disposable income for me. I'm 53 years old and my wife is 48. We intend to travel and be very active for the first two decades in retirement, then dial it back as we age. I'm not figuring SS into this, mine will be greatly reduced because I'm a municipal employee with a pension and didn't pay FICA taxes for the last 20 years. I just plan on reducing my draw from the portfolio by the amount of our SS so we can leave more for my daughters.
I use the think I would need a million dollars, but the closer I get to retirement, I now think I need 2 million. Just for a safety net. More is better right. By the way my yearly expenses is close to 35 K a year and yearly income is around 55 K, So I dont make much. 25 percent goes to savings.
Very well articulated; I wish I had more time for trial and error, but I'll be 56 in August and I need ideas and advice on what investments to make to set myself up for retirement, especially with the looming inflation and recession; my goal is to have at least $1 million by the age of 60.
Thank you Kieran!
I'm not going to have different sections I'm going to create a social security ladder until I collect Social Security.
The rest of my money after the Social Security ladder I will probably be using 4% plus inflation withdrawal rate. I would feel safe with five percent plus inflation but I hope my portfolio is enough to do 4%
The name of the game in retirement is cash flow. Portfolio is great, but be certain you can sustain a healthy income for the long run. And don't cut it too close. Otherwise, don't retire.
No it's total return that matters not cash flow
Yep, a sustainable cash flow is the key to a successful retirement.
Rental properties work wonders
@@johngill2853 - I'm afraid without positive cash flow you're dead in the water no matter what the potential total return. Cash flow is king!
I am 45 years old with very little set aside for retirement at this point. I have always been curious about the stock market and have witnessed some people who played the game right and retired early because they used the stock market. When I ask them, most said that they invested very little to start with, but their portfolio grew. I do have a significant amount of capital that is required to start up but I have no idea what strategies and direction I need to approach to help me make decent returns
I would stick to low fee index grown stock funds. They normally grow about 10 percent per year. Maybe add healthcare and technology funds which grow around 15 to 20 percent. Stay away from individual stocks. You still have at least 20 years to grow your wealth. Keep investments simple. You will sleep better at night. I started investing at age 15. Slow and steady. Listening to financial advisors is a sure way to lose money.
I notice many comments from people hoping to retire at 55 or 60. I'm wondering if they're incorporating medical insurance premiums into the picture until they turn 65. That eats a large portion of the monthly budget.
I hope so!
Health care is cheap under Obama care if your poor on paper. I plan to live off of cash from a house I am selling until 67 when SS kicks in . I will have virtually no taxable income from 60 till 67. So Healthcare will be less than 100 dollars per month. Maybe 0 dollars.
Hi James, your mic does not sound as good as it used to, fyi
Agreed
ty
Glad it was helpful!
2.3 million is my goal.
I'll retire in 5 years at age 51 with a military pension of around $86K/year in today's dollars (with COLA), don't plan to work again, and I plan to begin SS at age 70. Currently our portfolio is ~$1.5M in Bogleheads-style Three-Fund Portfolio at 80/20 AA, and adding around $100K/year. We're conservatively planning to have around $2M by the time I retire, depending on how the market does. I plan to use a rougly 3.25% withdrawal rate. The tough part for us: 2 kids to put through college (~$150K in 529s), and we have no home equity so I'll have to begin a new mortgage (or buy a house in full) after retirement in 5 years.
I dind know the Military pays so well. I have never even close to making 86 K a year in Private sector as skilled trades guy. I guess I took the wrong path in life.
That's all good until purple takes an early dirt nap and orange is down to one SSA check and live till 90. Always plan like you are going to out live your partner and not depend on their SS check to pad your outlays..
Does your 5% withdrawal rate assume 5% rate of return, thus essentially not touching the principle balance?
It assumes a higher rate over time and is based on Jonathan Guyton’s research on sustainable withdrawal rates
First off, to answer this type of question, you have to know HOW MUCH YOU WILL BE SPENDING. You try your best to estimate how much that is... but it took me about a year in retirement to really solidify my expenses (and I do spend a lot more with all my free time). Without this key fact, you will never know the answer these questions.
Great point! The answer is it depends largely on how much you want to spend.
Can you and Josh Scanden from Heritage Wealth Planning do a live stream together. You two would make a great team.
Not a bad idea! Thanks John.
Working on eliminating debt. But $2 million is the goal.
Sounds like a great goal.
Hi James, 3M?
Perhaps you could invest in a microphone 🎙 🎤
Yeah I recorded a few videos not realizing the microphone wasn't picking up audio correctly 😆
You can absolutely retire if you’re 60 with no kids and no debt and a million in the bank.
$1M
promosm ✔️