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A very well known financial personality borrows a term from nuclear reactions to describe what ought to be the goal for retirement planning -- Critical Mass | atomicarchive.comThe amount of a fissionable material's critical mass depends on several factors; the shape of the material, its composition and density, and the level of purity.
I tend to agree with the theoretical open-endedness of such a target. If some one has financial holdings that "self replenish" regardless of how things go then you can continue to live your chosen lifestyle indefinitely.
As a practical matter it is extremely rare for this to really happen -- people decide to "treat" themselves with something like a special vacation house or exotic car or yacht and these things end up being "money eating machines" that destroy the self-sustaining features one may have 'baked in" to their portfolio.
I know dozens of people, both men and women, that have gotten into relationships after retirement that swallowed up huge portions of what was supposed to be a "self sustaining retirement income", to say nothing of the funds eaten up by lawyers...
I also know a depressingly large number of folks that have ended up supporting adult children, in-laws, parents and all kinds of extended family that just did not have the sense of responsibility / foresight as folks that planned out what to do with their earnings.
It is also depressing how quickly even relatively healthy folks with issues like mobility can end up needing very costly assistance as they age, to say nothing of the insanely costly care required of folks with more serious health issues...
To be sure all these issues really are unpredictable -- there are some folks that never face any these things and get hit by a bus the day after they "hang up the spurs". Other folks live to a ripe old age in near perfect health, with family equally prosperous / healthy. Most competent financial planners advice folks to make a fair assessment of their own health and their tolerance to "say no" to those looking for a handout and plan accordingly.
Alternatively? Get a job in state like Illinois where folks can use their relationship to political dynasties to get a pension that is bottomless income for life, far exceeding BOTH what they ever put into the system OR even what they ever earned -- Citizens for Reasonable And Fair Taxes: State lawmakers' pension jackpot
I don't think any amount is "excessive" and I would say $10 million dollars is wealthy because you shouldn't have to rely on a job at that point. Your money should be working for you.
Only on C-D would someone say ten million is not wealthy. One hundred million isn't the wealth of one billion, but ten million and up is wealthy.
I don't think anyone said that a net worth of $10 million isn't wealthy. The question is whether a net worth of in excess $10 million is excessive. In this day and age I really don't think it is, despite the fact that it's more than I would ever need.
When I say net worth that does not include your home.
It only includes cash, stocks, funds, etc.....
Why wouldn't it include your home? Is the guy with a $100,000 home and $10 million in other assets living a more excessive lifestyle that a guy with a $5 million home and $9 million in other assets?
What if you home is a farm worth $10 million, and all your wealth building goes into the expansion of the farm?
If i had $10M of net worth, excluding my house (i guess because it's considered an illiquid asset?) then that would be more than enough for me and my wife. it's an excess of what I have set for our retirement target. if i had that much at my current age (32), i'd be comfortable retiring from "real work" (5 day job) and venturing out into other things to create a modest income stream beyond what some sensible investing of $10M would get me annually.
I don't think anyone said that a net worth of $10 million isn't wealthy. The question is whether a net worth of in excess $10 million is excessive. In this day and age I really don't think it is, despite the fact that it's more than I would ever need.
When you say 'excessive', what do you mean. It sounds like you want to imply that it is somehow rude.
10mm is my retirement target once the wife and I hit that we are done working
Why anyone would work to accumulate that much is beyond me. $10M with a very conservative 3% withdrawal rate is $300K per year. How much income does one need????
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