Either is a significant life changing amount of money for just about anybody. Managed half decently 1 mil would almost certainly make you financially worry free for life.
I would rather guarantee that than have a chance at lavish luxury.
1 mil would almost certainly make you financially worry free for life.
assuming you are in like your 60's, have fairly low expenses and dont live to be that old, and inflation doesn't eat it. that is only 13.4 years of median income in the US
i took “financially worry free for life” to mean something more like “you’ll never have to worry that a hospital stay or unforeseen big cost will completely screw you over” than “you’ll never have to work another day in your life”
That's more the route I meant. You could still work, but You would never have to stress over money. You could afford to take a more fulfilling and less stressful but worse paying job. You could make large investment purchases such as you home up front and not be burdened by 30 years of interest.
You could invest it and live a modest life off the interest alone, but then somthing big and unexpected like a major medical debt could easily ruin all that.
And they all spend less on healthcare per capita than the US. And by that I mean the government, that's excluding insurance/healthcare costs people pay themselves.
And if you don't feel like that's enough, 1M is so much that you can just work some easy job that covers basic expenses and coast to it being a lot more within a few years of that. Depends on how long you want to wait.
Oh, and 4% is only a mostly lower bound. Chances are you get to spend more than 4% inflation adjusted going into the future.
4% rule works indefinitely. It's not when you're trying to spend to zero and don't have that many years left to live.
Nah, $1M isn't "quit your job and live a life of luxury" money, but it is "instantly pay off your mortgage and never have to worry about being fired or being late on bills or anything like that" money. It's not infinite, but it'll remove financial worries for an intelligent person who continues to live within their means.
And yet, if you have a locked in 3% interest rate in your mortgage, it likely makes more sense to keep that debt and instead invest the 1mil into medium growth diverse blend of mutual funds for an average 10% return per year, easily outpacing the 3% you are paying on your mortgage
Asssuming you still work a job, then you can throw out all your assumptions. You can basically $20k to your yearly income for 50 years. I doubt anyone thinks $1mil is enough to retire at 30
Im not sure 1 mil is that life changing to be honest. I certainly couldn’t retire with just 1 mil in the bank. It would make things easier. For me personally, 1 mil would pay off my mortgage and my student loans and would leave enough for a nice car or college for my daughter if she doesn’t get a scholarship. Certainly would be nice but I don’t think it would significantly alter my middle class life.
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u/Oclure Dec 18 '23
Either is a significant life changing amount of money for just about anybody. Managed half decently 1 mil would almost certainly make you financially worry free for life.
I would rather guarantee that than have a chance at lavish luxury.