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I'm 37, hubby is 39. We expect to be able to retire in our 50s with somewhere around $600k. Current living expenses are about $23k, but that includes a mortgage. Since we would have to pay for our own insurance at that point, I'd call that a wash and say our living expenses would still be somewhere in the $20-25k range.
So I'd invest somewhere relatively stable, with 4-6% expected returns, and just work part time whenever we want to, for the rest of our lives.
It all depends on what that extra 40k is on top of. In fact considering most ameriicans can't come up with 10k that hypothetical million may be the whole deal.
So my comment was based on just that . While the million is nice it still can fall way short of changing a thing depending on ones cost of living and situation.
I can say in our case another million would change little in our life except for a few more trips a year and possibly more left for heirs.
While a million sounds like a lot if it is going to be used to support you and you have little what that million represents is nothing special in many areas.
Here it represents rent and medical / long term care insurance.
Don't forget if your income is low enough that insurance is all given to you or subsidized. Many get subsidized housing too so that million may bring you nothing you didn't have before only now you get to pay for it.
So, true. I think a lot of folks think a million is a "whole lot." Well, it's something, but not enough to live off the income stream it can produce if one wants to live a fairly comfortable lifestyle. I guess, again, it all depends on what a comfortable lifestyle is to you.
I would buy a house/car cash and just draw 40k or so yearly off the money via bonds/interest etc while working a part time job that pays my health care
Invest it all. 100% in the market. I would love to pay off the house but it will eventually get there and we have time. Our interest rate is under 4% so I am thinking I can do better with the money in the market. I have seen what my returns are averaging and it is way better than 4%. Imagine what that million could do in the market. The closer we get to $5million is the closer we get to retiring.
My wife and I are already in the 6 figure club and growing. We are doing fine now.
My Mutual Funds have been mostly a mix of the following. Retirement accounts are similar. I just let it grow.
25% small cap
25% 500 fund
25% Heath care
25% Mid cap
I'd move to a low cost-of-living area and set up a nice life for my family. Buy a big house for $100k-$200k, and just live out my years with my family by my side. I'd probably end up doing some part time work on the side just to keep my mind sharp, but no more than 20 hours or so per week. Probably write wills or do taxes or something (I'm a lawyer)
Most I would have my brother invest, along with the money he already invests for me. 10% to charities, have a house cleaner 2x week, maybe buy a mobile home, but maybe not as I live in a nice senior apartment. I miss having a cat though & I can't have pets here.
I would take maybe a thousand to go gambling. I don't know, haven't gone to a casino in many years. Mainly invest I guess.
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