Combined with Social Security, this would give you almost $32,000 in pre-tax income during your first year. This isn't much to live on and it would only last you about 19 years (assuming inflation adjustments) before your portfolio runs out.
Combined with Social Security, this would give you $31,000 per year in pre-tax income. This isn't much to live on and it would only last you about 25 years before your portfolio runs out. Starting at age 87, you will need to coast on $16,000 per year in Social Security benefits for the rest of your life.
It is 100% possible to retire with $400,000, provided you're not looking to enjoy a particularly expensive retirement lifestyle or hoping to leave the workforce notably early.
Just 16% of retirees say they have more than $1 million saved, including all personal savings and assets, according to the recent CNBC Your Money retirement survey conducted with SurveyMonkey. In fact, among those currently saving for retirement, 57% say the amount they're hoping to save is less than $1 million.
We estimated that most people looking to retire around age 65 should aim for assets totaling between 7½ and 13½ times their preretirement gross income. From there, we identified savings benchmarks at other ages based on a reasonable trajectory of earnings and savings rates.
How much does a $400,000 annuity pay per month? As of January 2025, with a $400,000 annuity, you'll get an immediate payment of $2,400 monthly starting at age 60, $2,643 monthly at age 65, or $2,850 per month at age 70.
The magic number that most Gen Xers feel they need to retire is $1.56 million. This is much higher than the average amount they have saved — $108,600 — and higher than most Americans feel they will need. In short, Gen X retirement is in trouble.
Your payment should not be more than 28%. of your total gross monthly income. That means you'll need to make 11,500 dollars a month, or 138 k per year.
Probably 1 in every 20 families have a net worth exceeding $3 Million, but most people's net worth is their homes, cars, boats, and only 10% is in savings, so you would typically have to have a net worth of $30 million, which is 1 in every 1000 families.
Believe it or not, data from the 2022 Survey of Consumer Finances indicates that only 9% of American households have managed to save $500,000 or more for their retirement. This means less than one in ten families have achieved this financial goal.
The 4% rule aims to guide retirees to relative safety. Here's an example of how it works: An investor would withdraw $40,000 from a $1 million portfolio in the first year of retirement. If the cost of living rises 2% that year, the next year's withdrawal would rise to $40,800. And so on.
If you have $400,000 in the bank you can retire early at age 62, but it will be tight. The good news is that if you can keep working for just five more years, you are on track for a potentially quite comfortable retirement by full retirement age.
$400,000 is a big annual household income. You can certainly survive just fine off $400,000 a year. However, based on the above expenses, a $400,000 household income only provides for an upper-middle-class lifestyle for a family of four in a big city.
Financial planners often recommend replacing about 80% of your pre-retirement income to sustain the same lifestyle after you retire. This means that if you earn $100,000 per year, you'd aim for at least $80,000 of income (in today's dollars) in retirement.
What are the average and median retirement savings? The average retirement savings for all families is $333,940, according to the 2022 Survey of Consumer Finances. The median retirement savings for all families is $87,000.
Financial experts historically suggested, as a rule of thumb, that you needed to generate 70 - 80% of your pre-retirement income for a comfortable retirement. Now, many experts are suggesting that you will need closer to 100 percent, at least during the early years of retirement (typically for travel).
You expect to withdraw 4% each year, starting with a $24,000 withdrawal in Year One. Your money earns a 5% annual rate of return while inflation stays at 2.9%. Based on those numbers, $600,000 would be enough to last you 30 years in retirement.
In most cases, you will have to wait until age 66 and four months to collect enough Social Security for a stable retirement. If you want to retire early, you will have to find a way to replace your income during that six-year period. In most cases $300,000 is simply not enough money on which to retire early.
Most financial advisors will tell you that the best age for starting an income annuity is between 70 and 75, which allows for the maximum payout. However, only you can decide when it's time for a guaranteed stream of income.
If you were to place $500,000 in a high-yield savings account with a 2.15% APY and wait one year, you will have earned $10,750 in interest. This rate is likely insufficient to keep up with annual inflation, which means your money will become less valuable at a higher rate than when it's accruing interest.
According to the Social Security Administration, or SSA, the monthly retirement benefit for Social Security recipients is currently $1,783.55 in 2024 on average. Several factors can drag that average up or down, but you have the most control over the biggest variable of all — the age that you decide to cash in.
The $1,000 per month rule is designed to help you estimate the amount of savings required to generate a steady monthly income during retirement. According to this rule, for every $240,000 you save, you can withdraw $1,000 per month if you stick to a 5% annual withdrawal rate.
Those will become part of your budget. The 50-30-20 rule recommends putting 50% of your money toward needs, 30% toward wants, and 20% toward savings. The savings category also includes money you will need to realize your future goals.