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Why You Probably Don't Need a Million Dollars to Retire

Pop Culture Finance is obsessed with one piece of advice. If you are going to retire, you need to accumulate a million dollars. They give out this advice as if it is an absolute truth. The problem for most future retirees is that they hear this advice and become automatically dejected because they see that there is no way to obtain such a big goal given where they are.


The truth is that everyone has a number that they have to accumulate to retire. That number is specific to their individual goals and could be any number. In all of the plans that I have put together through 28 years of practice, I have come across all types of combinations of savings and income flows. None of that work has indicated that a million-dollar investment at retirement is the gold standard and a requirement for retirement.


Writers of pop culture finance write these articles about achieving the million-dollar goal as if it applies to everyone. A million dollars to a 25-year-old at retirement is a vastly different future value and means much less than a million dollars to someone who is going to retire in 10 years. It is all about inflation.


Bottom line - don't pay attention to someone who tells you what you need without first doing the math and the planning that supports that piece of advice.