I'm early 30s, single, do not plan on having kids, and have about $1m in assets (no house).
I have seen a few articles/posts on people in similar situations (including 1 couple) who have decided that was enough to stop working.
Ask HN: Is it possible to retire early on $1m?
1–10 of 10 posts
Re: Ask HN: Is it possible to retire early on $1m?
#2That depends on a lot of factors. Mostly: how much will you spend per year? And what will the market return: not just on average between now and when you die, but also when will it stagnate/crash and when will it grow?
Re: Ask HN: Is it possible to retire early on $1m?
#3As long as you stay single and don't live in CA or any other blue state, then yes, that will be more then enough to live well. Right now, I know it might seem like you'll be single forever. But, that might change. If you do get a GF, she may want marriage and kids. That will change the equation: at that point you'll need about at least 4-5 times more then what you needed as a single person.
Keep in mind, most forecasts (the average) for long term equities say it will yield roughly 3% real, from here on out, much less than the 6.7% that people have become accustomed to in the last century. This is due to slowing world growth, both in population and a slowing of per capita productivity increase.
Re: Ask HN: Is it possible to retire early on $1m?
#4It depends... based on 'safe' withdrawal rates (and what the assets are invested in!) 1m will generate 30-40k per year. If that's enough, then why not?
You may find https://www.reddit.com/r/Fire/ helpful.
Re: Ask HN: Is it possible to retire early on $1m?
#5As long as you stay single and don't live in CA or any other blue state, then yes, that will be more then enough to live well. Right now, I know it might seem like you'll be single forever. But, that might change. If you do get a GF, she may want marriage and kids. That will change the equation: at that point you'll need about at least 4-5 times more then what you needed as a single person. Keep in mind, most forecas…
What specifically is the issue about retiring in a 'blue state'? If you mean cost of living, the OP might choose Needles CA or some place that is much less expensive than, say the Bay Area. Is there a tax you're referring to that is problematic (i.e. cap. gain tax on investment income in state) or just the hidden taxes (i.e. taxes on fuel etc)?
Re: Ask HN: Is it possible to retire early on $1m?
#6As long as you stay single and don't live in CA or any other blue state, then yes, that will be more then enough to live well. Right now, I know it might seem like you'll be single forever. But, that might change. If you do get a GF, she may want marriage and kids. That will change the equation: at that point you'll need about at least 4-5 times more then what you needed as a single person. Keep in mind, most forecas…
What specifically is the issue about retiring in a 'blue state'? If you mean cost of living, the OP might choose Needles CA or some place that is much less expensive than, say the Bay Area. Is there a tax you're referring to that is problematic (i.e. cap. gain tax on investment income in state) or just the hidden taxes (i.e. taxes on fuel etc)?
CA generally has a heavy tax burden. There are other "blue states" with lower tax burdens but the original comment was right on... generally middle of the country is cheaper.
Re: Ask HN: Is it possible to retire early on $1m?
#7There’s obviously no way to predict what your needs will be in 40 or 50 years. If you don’t own a house, what will your rent be like? Insurance needs? Maybe we will get Medicare opt-in or something like it, but who knows. Will coastal cities even be viable 50 years from now? Florida will be underwater.
Re: Ask HN: Is it possible to retire early on $1m?
#8I would say absolutely. You should be able to take over 5% of the total and never dip into the principal. You might be able to take 7-8% even. But it depends on your cost of living which can vary widely. Not owning your own home yet means rent, and that is usually the most expensive part. If you owned your own home with $1 mil then you should be set. But you want to do more research, so I suggest https://www.getrichslowly.org/, https://www.daveramsey.com/, and https://www.mrmoneymustache.com/blog/. These are all financially conservative resources.
Re: Ask HN: Is it possible to retire early on $1m?
#9Depends. Using the "4% rule" you should be able to drawn down $40k/year, without depleting your capital, so if you can live on that then in theory the answer is yes. There are various provisos with using the 4% rule but I won't go into them here. A couple of other options:
1) You could retire from full-time work and do the odd contract.
2) Set up a little sideline. It wouldn't have to make much as you already have a lot saved.
3) Part-time job at Starbucks (or similar). This is also known as Barista FIRE (FIRE is Financial Independence Retire Early). The idea is in USA you'd get the Starbucks free health care, and a little income, plus it might be fun, if somewhat hectic.
4) You really do need to think about what you would want your retired life to look like. "Not work" will only be enough to take you through the "decompression zone", not beyond.
One final point. Things change. You change. Life happens. At some point you might want to get married, have ten kids, and build a house in the countryside. Who knows. I think that's why keeping your skills honed and brain working in "retirement" is probably a good idea.
Re: Ask HN: Is it possible to retire early on $1m?
#10As long as you stay single and don't live in CA or any other blue state, then yes, that will be more then enough to live well. Right now, I know it might seem like you'll be single forever. But, that might change. If you do get a GF, she may want marriage and kids. That will change the equation: at that point you'll need about at least 4-5 times more then what you needed as a single person. Keep in mind, most forecas…
What specifically is the issue about retiring in a 'blue state'? If you mean cost of living, the OP might choose Needles CA or some place that is much less expensive than, say the Bay Area. Is there a tax you're referring to that is problematic (i.e. cap. gain tax on investment income in state) or just the hidden taxes (i.e. taxes on fuel etc)?
Cost of living is much higher in blue states, unfortanetly. It's a outcome of higher regulation which customers end up paying for. Higher cost of living in terms of Shelter cost, Utilities and generally higher taxes.