Retirement Number Roundup: How Much Do You Need For Retirement?

13 people, 13 different retirement numbers. As evidenced SWR and retirement numbers are a very personal decision when pursuing FIRE. 13 people, 13 different retirement numbers. As evidenced SWR and retirement numbers are a very personal decision when pursuing FIRE. How much money do you need to retire on? See what 13 aspiring early retirees are planning. How much money do you need to retire on? See what 13 aspiring early retirees are planning.

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Ever wonder what people pursuing financial independence and retiring early actually plan on saving?

I know I do. There is such a wide variety of personal circumstances and individual desires, that there cannot be a one size fits all approach to early retirement.

I sent out the below set of questions on the Rockstar Finance Forums searching for answers.

  • What is your retirement number?
  • Is it based on the 4% rule or how did you derive it?
  • Do you plan to make money in “retirement” and is it accounted for in your retirement number?

I got an overwhelming response and was extremely happy to see everyone sharing their numbers. Money is a very sensitive topic for many and lots of people have no desire to share their personal circumstances because they may be compared to others. Thank you to all that shared their retirement plan with me.

The purpose of this roundup is to give you some perspective on what different people think is enough and how to achieve it. I hope it can inspire you to look a little closer at your own personal finances and try to achieve what these bloggers are attempting or have achieved.

Related Posts:

Retirement Number Roundup

Adam from Minafi

What is your retirement number?

Currently, my FI number would be around $2m. I don’t have a set RE number. Plan to wait to retire until I hit this number and want to try something new.

Is it based on the 4% rule or how did you derive it?

3% rule @ 60k/year — for 2 people who love to travel. I wouldn’t be surprised if I adjust this down later when a time comes when I’m feeling “close”.

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

I’m not counting on anything being successful, but I’m sure I’ll be attempting to pursue things that make money. If any of them hit, then that would mean more luxurious or frequent travel.

Steve from Think Save Retire

What is your retirement number?

My wife and I retired with $890,000.

Is it based on the 4% rule or how did you derive it?

We used the 4% “rule” as a guideline, but our spending plans don’t exceed $25,000 to $30,000 a year.

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

I am pulling in a small income, but I never planned on it. Funny how opportunities suddenly materialize once you don’t have the cloak of a full-time job obscuring your view of the world. :slight_smile:

Dad from Dads Dollars Debts

Retirement number

I have a draw down plan coming this weekend – 2 parts. Part 2 on Sunday is about retiring at age 48 (11 years from now) though I could potentially do it at age 46. My number is something like $700k in a taxable account to get me through 48 to 59.5 years old when I can start drawing down my 401k, etc.

Based on 4% rule

Not really, just figured I needed 70k a year pre-taxes to live. Oh and I must be debt free. I typically use 25 x my annual expenses, though, to figure it out.

Money in retirement?

I want to make some money in retirement. Maybe do a month of locums work as a doc or if my blog takes off, keep writing. Oh, and if I stay with my job for 10 years I get a decent pension at age 65. So yeah, that is some sweet income.

Lily from The Frugal Gene

What is your retirement number?

$3 million is the long running joke my husband and I tell each other.

Is it based on the 4% rule or how did you derive it?

Nah, we could FIRE right now if we wanted to eat beans and rice for the next 60 years but I want to be a millionaire (just to prove we can do it). 3 million is the figure after adjusting for inflation (because The Millionaire Next Door is an old old book.)

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

I will never stop keeping busy so the actual withdraw % is still up in the air. I know that I would be very bored if I didn’t keep myself semi-busy. I still have a great American novel in me…somewhere.

Brad and Karla from Maximize Your Money

What is your retirement number?

Our comfortable living budget is $75k/year. That includes a decent amount of travel and vacation. Based on that we need at least $2.1 million – and we have a little bit more than that right now. About half in a taxable account and half in IRAs.

BTW, that doesn’t include about $800k in a personal residence, cash, and little things.

Is it based on the 4% rule or how did you derive it?

Being in my 40s, I go by 3.5% rather than the full 4%.

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

It would be nice if the blogging and coaching brought in some decent money at some point, but I’m not banking on it.

Amy from Life Zemplified

What is your retirement number?

We are gunning for $1.25M

Is it based on the 4% rule or how did you derive it?

Slightly under the 4% at 3.8%

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

We are not making work a part of the plan, but know that we will probably do something for additional fun or travel money.

Bonnie from Miss Bonnie MD

What is your retirement number?

Our FI number is 5 million, but I’ll cut back when we reach 3 million

Is it based on the 4% rule or how did you derive it?

Yes, altho not based on actual spending (still working on what the spending is combined) – so the 5 mill may change

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

Not sure, but can work easily if need be.

Our FI Journey

What is your retirement number?

We’re looking at $1.5M to $1.7M.

Is it based on the 4% rule or how did you derive it?

Based on 4% rule but we’re also a little more conservative and would love to have some margin. We also want wiggle room for other unexpected life changes. We have 2 little kids and parents we want to enjoy life with and who knows what that’ll bring. We could live a super frugal lifestyle and retire with so much less but we appreciate balance and are also hoping to set up our kids for an FI life.

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

Our current plans consider no additional working income but we’re not the type to just sit around and do nothing. We’ll tinker around and do things we enjoy and more than likely those activities will generate some money. But if not, no worries!

Guy from Guy on FIRE

What is your retirement number?

My retirement number is $45k in annual income. This will be a mix of rental property income and dividends/portfolio.

Additionally, I will plan to have three years of living expenses in cash when I retire early. This will allow for a buffer and prevent potentially drawing down on my portfolio during a market correction/recession.

Is it based on the 4% rule or how did you derive it?

I plan to utilize the 4% rule for calculating income outside of my rental property income as well.

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

My rental properties will technically count as passive income. However, regarding an active income, I have no intentions of working for at least a couple years. I may get board or inspired to start something entrepreneurial

Slow Dad from Cantankerous Life

What is your retirement number?

An asset base that generates enough passive income to cover my living costs, without relying on selling down capital.

Is it based on the 4% rule or how did you derive it?

I worked out what it costs to be me, and therefore how much income I required to comfortably cover that.

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

For me, the goal was Financial Independence. After that, I enjoyed the luxury of choice, with my choices not being constrained by needing to worry about how to pay the rent.

I’ve ended up settling into a seasonal work pattern, enjoying the warmer Spring/Summer/Autumn months, then finding an interesting or challenging puzzle to solve over the winter when the weather is cold/wet. The projects have been of my own choosing, without the need for demanding hours or much in the way of stress. Keeps my brain active and my skills relevant, in many ways, it is a paid excuse to learn new things.

Dad from Brand New Papa

What is your retirement number?

Target is $1.4M. If it was just me, I would target 1M, but my wife is ultra conservative and thinks we will need 50-60k/yr in retirement (even though we only spend 40-50k/yr now with a mortgage :unamused:).

Is it based on the 4% rule or how did you derive it?

3.5% SWR. Looking at the FIRE simulations and discussions on the Mr. MM forums, 3.5% gives me the comfort level I need to no worry about running out of money. 4% is only successful about 90% of the time, and even less when you consider the accumulation phase, not just the de-accumulation phase.

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

To be determined. I plan to do nothing for at least a year and see where my interests lead me. I’ve considered working part time as a technician at the local science museum. I did it in college to pay the bills and really enjoyed it. I’ve also considered putting more time into my 3D printing and design company/side hustle, but I’m concerned this would feel too much like “work”. I’ve considered doing odd jobs around the neighborhood – handyman type stuff. I enjoy doing it on my house, why not get paid to help others? Time will tell.

Full-Time Finance

What is your retirement number?

$2.5 million.

Is it based on the 4% rule or how did you derive it?

Not really. I’ve set a date to retire. I determined a decent goal of money to have on that date based on my savings rate at the time. It’s been a few years ago. Pay raises have changed the rate to the point where the number is only semi important. I’m essentially using the number to drive legacy savings by keeping me on my toes. The number is significantly beyond our needs.

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

No. But you never know.

Justin from Atypical Life

Last but not least, is me. If you have made it this far, congratulations. You have gotten a chance to see quite a few different takes on retirement.

What is your retirement number?

$1,000,000, but hope to trim it down even further with side income.

Is it based on the 4% rule or how did you derive it?

The $1,000,000 is based upon $40,000 at 4% safe withdrawal rate. The consensus in the forums and the early retirement community these days seems to be 3.5% is a better number to use, however, after doing my own personal risk analysis, weighing the pros and cons of retiring early on less, I can accept the risk of a 5% SWR. This would lower the $40,000 required savings to $800,000.

Do you plan to make money in “retirement” and is it accounted for in your retirement number?

I plan to make money after retiring from my corporate engineering job. Any money that I can begin to earn before retiring will only continue to bring down the required savings that I will feel safe retiring on. I have set a retire by date a couple of years from now, and we will see when we arrive there, whether my savings is enough to retire on or not.

TL;DR Response Summary Table

Just learned this week what TL;DR actually means. I have seen it around quite a few blogs, but never understood. For those of you like me that had no clue TL;DR means “too long, didn’t read”. In other words here is the condensed version of above.

NameWebsiteRetirement Number4% Rule?Yearly Expense EstimateMoney in Retirement
AdamMinafi$2,000,0003.00%$60,000Not planning on it
SteveThink Save Retire$890,0004.00%$30,000Not planning on it
DadDads Dollars Debts$700,000 taxable account4.00%$70,000Some minor Income
LilyThe Frugal Gene$3,000,000No, just thought 3 mil was enoughGotta keep busy, likely makes money
Brad and Karla KingsleyMaximize Your Money$2,100,0003.50%$75,000Not planning on it
AmyLife Zemplified$1,250,0003.80%$47,500Not planning on it
BonnieMiss Bonnie MD$5,000,0004.00%$200,000Not sure, can easily work if needed
Our FI JourneyOur FI Journey$1,500,0004.00%$60,000Not planning on it
GuyGuy on FIRE$45,000 annual income4.00%$45,000Not planning on it, though rental properties generate income
Slow DadCantankerous Lifepassive income to cover costs without selling capitalNoEnjoys the Spring/Summer/Fall and works some over the Winter
DadBrand New Papa$1,400,0003.50%$55,0001 year off, then will see
Full-Time FinanceFull-Time Finance$2,500,000Set a date to retireNo, but you never know…
JustinAtypical Life$1,000,0004.00%$40,000Planning on it to bring the $1 million down even farther.

As you can see from the variety of responses to my little survey, in order to feel safe retiring from work, there is no one way to retire. Everybody has their own situation and desires to fulfill when retiring early. SWR varied between 3-4% and the retirement number varied between $890,000 and $5,000,000.

I hope you can draw some inspiration from these fellow bloggers for the pursuit of financial independence and retiring early. I know I did.

What is your retirement number? Let’s continue the conversation in the comments.

 

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Comments

  1. 33-year-old DINKs here. Our number is $3M currently. Our current lifestyle has us spending about $70k per year and that includes a lot of travel (about $15k/year). We want to travel even more in retirement, our expenses will go up (but also leaves a lot of room to cut back if needed). Not planning on working per say, but I bet we end up bringing in a little money each year via our hobbies.

    We currently have about $1.25M in investable assets and save over 50% of our income, so fingers crossed that we’ll hit our FIRE number in 7 to 9 years.

    1. Nice work Sarah, and thanks for sharing. As I am still pursuing financial independence like you, I have no experience with post-retirement spending. As I have heard, and as I speculate, once you quit work, you can actually live for less, especially if you are traveling full time. Lose the house payment and travel, travel, travel. Travel becomes cheaper because you are no longer in a rush to go there and come back so quickly which sky rockets the cost.

      Does your $70k per year include taxes?

      1. $70k (current spending) does not include taxes. I’m budgeting for spending ~$100k/year in retirement, but withdrawing $125k/year to account for a 20% tax rate. These are pretty conservative estimates and I imagine actual expenses will be lower, but that’s how we got to a $3M number.

  2. Thanks for including me.

    There is an interesting mix of responses, and plenty of nice round milestone target numbers.

    An interesting follow up would be taking a leaf out of RetirementManifesto’s book and exploring how the people here are structured to fund their early/post-traditional retirement age time periods. A $1m in a taxable account is very different to $1m in an inaccessible yet tax deferred pension account!

    1. My pleasure, Slow Dad. I love your gravatar! So, angry. Thanks for sharing.

      I think people try to shoot for round numbers because it is simpler and can be easily shared with others. As I was compiling this post, I was wondering about the structure of savings as well. I will likely be doing a follow up of you guys to see about your wealth distribution across accounts.

  3. Interesting topic. Is the “Yearly Expense Estimate” the amount before or after income tax?

    Thanks.

    1. Thanks Cathy! I calculated the yearly expense estimate for everybody that didn’t explicitly state it. I think it generally does not include taxes or includes minimal taxes because there are methods to withdrawal your money without paying tax on it. Individuals will each have their own take, just like the retirement number as to how much tax is included in their calculations/estimates.

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