I’m 60 with $2M How Much Can I Spend in Retirement?

[@julianugentarchitect]

Two houses are not likely needed at end of life, so selling one in 15-20 years would make a dramatic difference.

[@rripley62]

James, I know you've heard this a million times by now - but these visual examples using your software are SO helpful in understanding retirement planning and how it might apply to my situation. Thank you, thank you. I am excited to begin working with Root so that I can see how our personal numbers map out, making adjustments as needed and ultimately, putting that retirement plan into motion. Bravo.

[@pglover19]

This is a very powerful case study. The best one I have seen in a long time. Thank you and Ari for sharing and allowing us DIYers access to the same retirement planning software used in this video. I can't wait for the next case study.

[@nickpower-fj9bu]

Would like to have seen result if SS had been brought forward to 62.

[@ddmnov22]

Smart analysis. One of the best I have seen.

[@hansangb]

Wow..what a great episode. Fascinating how such small input changes makes so much difference.

[@photoboy1986]

if your houses are paid for how can you possible need that much money per year for basics?

[@johnd4348]

I have close to 3 mil single and can live on less than 35 K a year. I dont like to travel. Dont need 100 K in living expenses. or a new car or new anything. Still driving my 20 year old cars and will till they die or I die. If I make 3 percent return a year, I will be ok.

[@JohnSimpson-r5d]

I retired at 72 w/about $1.5MM. I could heave retired earlier but enjoyed my work and fell into the “just one more year” trap. My wife didn’t work but waited for her to also use Medicare, too.

[@EJJ-EvArms]

Taking SS at 62 solves this quite nicely. The break even point (because of the time value of $$ and compounding allowed by not taking out of one's investments) is around age 83. Well worth doing. So much of the risk is mitigated by doing so. Then simply adjust all that vacation spending based on yearly returns, consider selling the 2nd house Asa last resort, and they're fine.

[@jeffwoodruff1339]

The real lesson here is for high income folks who are in their 30's and 40's. If this couple's income was consistently high throughout their working years, and their projected social security income suggests that it was, then they spent a boatload of money during their life. The adjustments they should/could have made just 5-10 years ago, with retirement not quite on the horizon, would have allowed them to retire at 60 without compromise. As a true comparison, my wife and I, who never made half of their income, have a greater net worth at 64 and 60.

[@Lost_in_southern_california]

My wife and I started taking our social security at 62 to reduce withdraw from our investments.

[@WilliamFluery]

My mother’s long-term car is $108k/year in a memory care facility. $72k is reimbursed through her LTC policy. I used to provide in home care but could only afford 10 hours a day. I stayed with her 14 hours a day. Twenty-four hour in home care costs $25/hour x 24 hours = $600/day. LTC Insurance covers $235/day = $133k out of pocket annually. I found an incredible LTC facility in Chiang Mai, Thailand for $3,000 per month. That’s 24 hour care for $36,000 annually. Believe me when I tell you. Elder care in Thailand is sooooooo far superior to elder care in the USA

[@J-2024-v8i]

Excellent video showing different alternatives. Gentle reminder to this couple that she can contribute an additional $1000 in catch up HSA contribution to her own separate HSA as long as they keep an HDHP plan. Also, they seem to be paying a lot of taxes because most of their money is pre-tax. They should consider contributing more to a brokerage account and maybe some Roth conversions while they still have an income, and maybe some smaller Roth conversions after, either continuously or between 65 and 67 when SS kicks in, unless their RMDs are kept at bay.

[@墨紫月]

Ouch. I would try my hardest to lower expenses.

[@scottbaker9066]

Great evaluation of expense projections!

[@joemeyer2726]

Draw 3%, be invested 90% SPY, simple

[@peaceofcake8464]

67/67 is *never* the best SS claiming strategy for a couple unless the spouse is claiming a spousal benefit. The default for spouses with their own benefits should be 70/62 since on average one spouse will outlive the other by 10 years which makes the higher benefit especially valuable and the lower benefit not so important. Increase towards 70/70 if both are in exceptional health; decrease towards 62/62 if both have serious health problems or they have no other way to pay the bills.

[@loborocket]

This is pretty close to my exact situation and I was coming up with similar results. Glad to see I am not completely off base.

[@James4cycling]

They have enough equity in their homes to afford 7 years of long term care. Why not just eliminate the long term care cost from their budget and take out a reverse mortgage if necessary?

[@jdhaenen1]

What are these people spending 8K a month if healthcare, housing expenses, and travel aren’t included? Seems like a lot. Also seems unlikely they will maintain that spending rate as they get older.

[@JDRichard]

Great insight, my friend

[@MrTimbo17]

I knew the original plan wouldn’t work as soon as I saw 8K expenses before tax and insurance on two homes, considering their retirement ages. But like James showed there are several adjustments that can be made to improve their chance of success.

[@JBoy340a]

Good conservative analysis. Glad you added in the LTC expenses. $5,000-7,000/mo is not uncommon for LTC facilities today.

[@rustykatt3870]

Perhaps sell the recreation property, and just pay for vacations as you go. 😉

[@11Hammers]

So James, as others here have stated, why wouldn’t you consider taking SS earlier to take the stress off your portfolio?

[@vickieelijah3616]

Excellent discussion! Greatly appreciated!

[@ericwantsbbd]

225k and so little savings!? Crazy

[@murphy4m]

I would have liked to see the impact starting SS at 62 so they pull less from investments in those early years

[@rustykatt3870]

Excellent video! Thanks! Good luck to us all !! ✨😊✨

[@fdllicks]

With the 4% rule, a million =$40 grand a yr

[@jonathanjohnson6853]

Did you consider taking SS earlier?

[@mj55469]

Who is this video for? “According to estimates based on the Federal Reserve Survey of Consumer Finances, a mere 3.2% of retirees have over $1 million in their retirement accounts. The number of those with $2 million or more is even smaller, falling somewhere between this 3.2% and the 0.1% who have $5 million or more saved.”

[@lionmangolf]

Why not take ss at 62

[@rustykatt3870]

Probabilities of success being under 50% is worrisome.

[@davidandres7290]

At time 6:48 how come health insurance is $0 before year 2030?

[@angelasoWA]

They should sell their vacation home or make additional income on it when not in use. $2m is definitely not enough with their expenses being so high.

[@bmrbca3658]

How are they getting pre Medicare healthcare for $6K each? I'm currently paying $17K for a Bronze plan.

[@EB7144-gt9ms]

The cost of living increase over the last 10-15 years is insane; especially the last 5 years. I work in the financial industry. 15 years ago if someone would have told me that I would have a net worth of 1 million and not be able to retire I would have told them they are crazy. Right now my wife and I are in our early 50s and have a net worth of 2.5 million (2 million is liquid) and we are still working. Now I am thinking just to be safe we may need 3 million.

[@bruiserdeedee3793]

Considering this example situation, I wonder how many retired singles or couples with $1-2M investments (most in US stocks) put on quarterly or annual hedges like buying 6 month out SPY and QQQ puts (maybe $3-4k option premiums per year) so can stay invested and get some protection from major market correction. Or just stay 60/40 or 80/20 long stocks/ bonds and take the hit on mkt correction.

[@lvega5606]

I wanted to retire as soon as I had $1M because I hate working, but my expenses are just so high that I need to keep working until I have $2M. It's kind of sad that a lot of us have to work until we're too old to enjoy retirement.

[@WhiskeyCurious]

I am grateful you cover pre-SS scenarios. I would be helpful if you could occasionally toss in some strategy specifics for the single retiree. I do try to adjust the math but there might be some gotcha's I don't think of.

[@silversurferhi]

You are also assuming that the powers that be will adjust SS before 2033-34 and not screw us all

[@Donalddavies-gc9rb]

We are in our 60s with nearly $3M saved, no debt and $50K annual spending. But we avoid the stock market completely.

[@TheGOF]

Another great video. Thanks

[@charlesfrench9557]

Thanks James. Would you please consider making a video about how to use an hsa for investment versus spending it every year. For example a newly retired 59 year old couple with a $100 k hsa. Planning to enroll in a hdhp until 65 (Medicare). How long to continue accumulating the hsa. When/how to start spending it down. How to handle receipts over many years, etc. what happens if it’s not used. thanks

[@alanmerkley]

Really thought you were going to show the effects of drawing SS earlier as another option.

[@Murray-z4d]

I Hit $12,590 k today. Thank you for all the knowledge and nuggets you had thrown my way over the last week .i started with 3k in last week 2024..... now i just hit $12,590

[@uberurbane1333]

This is excellent video. Comes very close to my scenario other than the fact that my spouse is 6 yrs younger to me. However a person who has saved $2 million, needs to look at the real spending numbers. Honestly in this fictional example they are spending like they have $5 million savings. I think they need to mandatorily cap the spending at $120k max ($100k ideally). They are spreading their sheet beyond their means.

[@MembersOnlyRocks]

We all understand there are a lot of variables. Pick a scenario and take through the end and give final numbers for that scenario, THEN adjust variables and talk about how to optimize. My biggest pet peeve with these videos - ANSWER the question, can I retire at 60 with 2 million dollars, yes or no.

[@APeeKay]

Very nice study. What if one of them take SS early.

[@jasonbarker9943]

good video and information

[@PJBHolden]

I have $10 million and I’m 78, can I retire ?😂😂😂😂😂

[@fsquared8663]

Where can I get health insurance for $6k a year? It is more like 2.5k a month for 2 people?

[@Magpie-1111]

For that income level their primary house is not worth much. Presumably it is paid for already and therefore they can self-insure. If they have a second “vacation” home, why would they need to spend $25k a year on vacations? But presumably they want to travel a lot while they’re young, so do so but rent out the vacation home for a couple years while they travel, and then cut the travel budget to about half that. Enjoy the second home for the next 15-20 years and then sell one of the homes to cover LTC expenses if needed. As far as expenses, $8k/mo not including many mandatory items? They definitely need to start thinking about where they can save! If they cut $2k/mo, they can cover their high vacation budget.

[@allenb4113]

James, what's the minimum "Probability of Success" that you like to see for your clients?

[@featsbeyond5057]

I'd like to know where you got those healthcare numbers (I assume you mean insurance) because the cost of healthcare is a big impediment to my retirement plans.

[@brianwalsh607]

From the link for the software and course QA description: "Do I get full access to the software? There are certain advisor assumptions that cannot be changed by the end use. However, you will receive full access to use all the modules James shows in his KZbin videos" Is there a detailed list of what features are disabled?

[@mcdjacobs]

Heathcare costs seem crazy low. We are almost in the same financial situation and monthly costs for a Marketplace plan for 2 people is $3,400 with no subsidies. Yes, $3400 A MONTH. $40k a year. Where are these folks getting healthcare? If you retire, you lose your benefits. If you are downsized, you get COBRA for 18 months. There is nowhere else to get insurance. And years to go until Medicare. Please do some research on healthcare costs.

[@beanbean321]

What investments would you recommend for this type of portfolio ?

[@lucimathews8980]

What about the effect of RMDs?

[@MrChev-wq1jb]

I thought they had done pretty well with their net worth until I saw that their yearly income is over $300k. They should have been able to do better. LOL! Where is all their money going?

[@keithwilmes4946]

My home is of similar value…I see higher homeowners insurance of about $2000 in Missouri.

[@dansouth2088]

These people spend too much money.

[@riding29]

James - Your software looks to be some of the most complete that I've seen. Does it allow the end user to enter a cost basis for taxable and tax deferred accounts? Most tools make very general assumptions and don't even let the end user know.

[@ron8566]

@5:00. Please explain how Joe is saving $84k per year and also contributing $8k to an HSA when he only earns $200k before taxes? The numbers don’t make sense to me. Thx.

[@shawnm.9320]

Great case study. Can you use the same case but with one person? Maybe even just one home. $2 Million, 1 person, 1 home or no home.

[@trail_tracker]

At 9:00 mark, what taxes are they paying at age 64 when there is no inflow?

[@Too-old-Forthischet]

People who are able to retire early are lucky . I have 15 months till 65 and need to look at calling it quits, my only fear is running out of funds much later, thus keen on investing. What could be the safest possible ways to invest for cashflow, in order to afford lifestyle after retirement?

[@fmorelli]

Why did you run a fixed age 67 social security play? I would have considered, for example, a 62 social security pull and shown how that plays.

[@andrewrivera4029]

I feel sorry for your client, I retired at 53 years old with identical numbers 6 years ago and I’ve got more than what I started with despite spending upwards or 800k! lol, i wouldn’t rely on software to dictate when to retire…

[@jeffreylindley845]

Those SS benefits could take a major haircut. Might want assume that they will be at least 20%.

[@eltaneicebolden4522]

Could you please do a scenario for a single 60 year old person with $1M

[@Groqx]

Without earning any interest or growth in their portfolio, 2M will allow 100k per year for 20 years. With growth it could go much further. This is not rocket science. It all depends upon their longevity and health.

[@davidbryan3347]

At 5:41 social security income...how do they get that much? SSA tells me the max amount is $4018 per month at 67 or $48216 per year.

[@richardlewis7372]

The title of your video is quite misleading. How do you go from “I “ to Joe and Jackie?

[@danmargo2561]

Why didn’t you adjust for different social security retirement ages. At what age do they plan on living until?

[@kinggeek1960]

Not sure where you are getting $1.8M in investable assets-the presentation seems to indicate $1M?

[@user-id8ng9eq9h]

Surprised you don't included taxes and insurance as a "core" expense. Neither of those expenses are going anywhere, but up - and - don't pay your taxes....you lose your home. For me...those are my two greatest expenses.

[@arnelsin]

The investments tab did not add up to $1.8M. what were the other investments? trying to understand the withdrawals per account type.

[@clarkosaurus]

What if they buy an immediate income annuity to cover the gap? And what if they have some bitcoin in cold storage?

[@brianfp5712]

How would dividends and rental income play into the 5 years of "zero" income before SS and/or what if bringing SS up to 62?

[@brandj-12]

Originally from southeastern Ohio, I’m 55 and have worked abroad for most of my life. With $500,000 saved, I’m ready to retire, but I’m uneasy about inflation. Can I retire comfortably with this amount, or should I consider financial planning?

[@Cynicalgeek743]

The median net worth of Americans in their 60s (incidentally the decade where they max out their net worth) is $440k. The average retirement age is 62. Somehow they’re managing. Showing examples where the retirees have 5.5x the median figure is helping whom exactly?

[@krehbein]

18:26 sorry I don’t get it…. At age 90 over 2 mil in the bank but only 56% chance of success? 🤔 This video typifies an error in logic when people use financial planners. The planner wants to feel confident in recommending people retire by x age, but these estimates tend to be very conservative because the financial planner needs to CYA. People who retire can course correct any number of ways, not to mention 6% is below the historical S&P 500 by a couple points. Lastly, just ignoring the value of the house when one is in their 80s doesn’t make sense. That house could be sold and pay for assisted living for years, which would cancel one of the large expense assumptions in this video. Either way, thanks for sharing and I’m just spit balling, not trying to criticize.

[@johnbrennick8738]

Annuities deferred income ?

[@bman6502]

Wife and I are 62, and want to retire at 65, but we only have $13.5m in our investments.. not sure how long that would last..

[@briand4000]

$1.8M in investments plus a couple houses and wondering "if" they can retire? Did they fall on their heads or something?

[@gottafly30]

retire, and sell your house down the road IF you need to. my bill is in the mail...

[@jaysonpitkofsky8576]

I wish for the future you accurate label your videos (but most of content provider do this), this video is "I'm 60 with 2 Mil for Retirement how much can I spend" The use of "I" when in fact it's WE when you present. I am an "I" not a WE and was hoping for that video. Table for 1 here. I guess I am clicking, so that does help your channel but not me so much other than if it works for 2, it will be a no brainer for 1.

[@davedeboy5726]

I have 4m and it's still not enough to get me through 35yrs.

[@soudaminipanda]

If my only source of income is dividends on stocks. Will I have to pay any tax on the qualified part of the total dividend? Assume the non qualified dividend to be negligible. Thank you

[@chicarbiomed]

$8k/month just in expenses before other things? They need to chill…

[@keenheat3335]

you look great for a 60 years old

[@desmo8755]

At 4% withdrawal rate, $2M gets you a whopping $80K per year. Or about what the average state worker is gonna make in a risk-free pension starting at age 55, and you’re helping pay for. And odds are you end up dying with the same $2M you started with whereas they don’t care. This is why the 401K / IRA makes no sense.

[@juliot2223]

Hello James Can you share you email with me for a consultation Thank you Julio