2.5 million and I quit my job. 100k/year passive income. I’m learning to cook, probably adopting a child or 2.
10 mil. Enough to absorb all but the worst shocks to the stock market, continue to grow if desired, or pull $500,000/yr interest at a conservative 5% growth. $500,000 year means you could afford the Lamborghini, but you still gotta make payments.
IMO $2-3 million today is about the “millionaire” of yesteryear, someone we used to call rich but not crazily so. $10 million is actual passive wealth that is enough to live very well without touching the principal.
If you want it to run indefinitely then you need to let the principle grow with inflation as well, so with 5% growth and 3% CPI you have $200k to spend each year (which will also scale with CPI)
Edit: you’ll also have to choose more risky investments to stay above CPI, which means the stock market rather than fixed interest, and means your pot of money can change quite a bit with market shifts, and you may need to downsize expenses in some periods or risk eating into your principle if you can’t trim your lifestyle
Yes, I understand that and stated that the amount could be allowed to continue to grow as one of the choices for the investment. There was no need for me to get into the details and make it a financial lesson in respons to a hypothetical fantasy amount of money.
3 thoughts of school:
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Actually never working at all from my 30s onward, probably around 10 mil €.
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Quitting my job and getting into lazy investment to get a passive income, around 1.5 mil €.
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Playing into me being passively suicidal, if I loose my job and the number hits zero, I’m just killing myself. Technically that would also mean I don’t have to work again.
Number 3 is the most realistic one.
Technically that would also mean I don’t have to work again.
But if you are dead, you will never feel comfortable again. Technically that does not fulfill OP’s question. 😉
What is more comfortable than returning to the void from whence we’ve came?
Literally everything in existence is more comforting and simultaneously discomforting than the nonexistent void.
Comfort, as well as discomfort, are things not conceivable nor experienced in the void of nonexistence, since, y’know, they don’t exist (along with everything else).
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$300,000
High yield savings account would get you a little over 1k$ a month from interest alone. I already live on less than that. I’d just live off the interest.
1 million. Getting 3% back on investments will give me $30,000 a year. That far more than what I currently make. Also, less laundry, less eating out, and not burning so much fuel commuting to work and home.
Don’t forget inflation. That 30K isn’t going to buy you much in twenty years.
The general rule is that you need to cover inflation plus what you want to withdraw. That way your income goes up as inflation does.
I’m retiring soon. That should add enough to cover inflation.
Wildly jealous. Enjoy!
put the money in a standard index fund. take $25k per million out first year. increase that dollar amount by 2.5 percent annually to account for inflation. should last indefinitely unless some moron in a white house blows up the country.
700k and I’d be choosing to be dirt poor in monetary value.
But I’d have freedom to live. Not lavishly, but I’d be free. Read books. Exercise. Creat art. Love, maybe.
There are many things in life that are both valuable and nearly costless. That’d be better than what I do now.
💯 👏
Impossible to answer with all this AI BS that’s about to implode & take down a significant chunk of the economy with it.
3million used to be the “fuck you” money estimate, but it’s probably more like 12 now, so, 12million dollars.
2 500 € per month multiplied by months of, say, 50 years.
2 500 € * 12 * 50 = 1 500 000 €.
Would not be a rich life, absolutely not, but would leave me with enough money to live even if the part I’d invest was to be lost.
I’ve never thought it all out, but 5-10 million USD. It’s probably overkill, but I’m budgeting expense if I need to help my family out in the US as they age and such.
$50 mil, just enough to be reckless and still retire. I’d never work again. Vacations 24/7.
OP should probably have asked for the ages of people responding. One million takes an old person beyond the grave but might fall short for a 20 year old.
3 million USD. I’d still run my farm but I wouldn’t work my job job anymore. Just means I’d upscale the farm a small amount and give away a larger percentage of my products. 3 is genuinely low but I have very little debt as is and a reasonable lifestyle.
4 million invested with 5% withdrawal rate and 400k in HYSA. 200k per year with 2 years in reserve to buffer any sequence of return risk on the 4M. Adjust spending and rate as needed.
Why 5% withdrawal rate? Also, what do you do with your buffer in a year where the market crashes? Skip adding to your reserve that year and hope for a recovery?
many got burned on that formula before 2008. 45% of the entire value of the stock market is tied up in the magnificent seven of NVidia and AI. all go poof.
There’s the famous 4% rule that has been amended to 4.7%. I rounded up to 5%. Just a nice even number of 200k per year. With the flexibility the buffer adds and the ability to cut back in a down year I’d be comfortable with the extra .3%.
The buffer is there to live off of in a down year or years and not pull 5% out of the investment portfolio. Either 100% comes from the buffer or it can supplement a much lower withdrawal rate. In a known downturn I could reduce my expenses, minimize withdrawal rate, and fund the rest of the year with the buffer. Essentially I don’t want to pull $$ out of the 4M on a down year that will prevent recovery.
In an up year or a year I didn’t spend the full withdrawal amount, I can replenish. The 5% rate over a long time period will still let the portfolio grow. So if I pay myself 200k per year static, my rate could also naturally decline. There are a lot of factors (inflation, expenses, lifestyle) but that’s the high level framework.
