One million saved…can I stop now?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If you stopped investing today and we had a moderate 7% growth over the next decade you’d have:

2 million at 60
4 million at 70

Rule of 72

If you had a pension and social security, remained healthy for a while and lived within your means you’d probably be fine.

Its moderate

7% is not what I'd consider a moderator growth if you mean inflation-adjusted!

Doesn’t the s&p500 historically return around 7% adjusted for inflation?

Sure but I don't consider using the historical growth rate of 100% stocks all the way through 65 to be moderate. That makes assumptions I don't think most individuals or financial advisors would be comfortable with. It's not the percentage that's "wrong" per se, it's that the assumption requires a very risky asset allocation, so you shouldn't rely on it when thinking about stopping contributions.

Plus I'd rather look at Monte Carlo simulations or even just model some reasonable worst case scenarios to stop saving for retirement altogether.

Also risky because to get to $4 million, they assumed none of the money was touched for 20 years, so you have to keep a job to fund current expenses, which is never guaranteed, and not just by employer choice. There's a possibility of illness or disability of you or family members.

[Anonymous]

4% rule got an update from the creator:
https://www.investors.com/etfs-and-funds/retirement/four-percent-rule-for-retirement-new-withdrawal-rate/

It’s now 4.7% with specific mix of 60% equities.

It was never really rule. Just a worst case scenario in 100 years.