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Can you retire on a million dollars?
Topic Started: 21 Aug 2015, 07:45 AM (5,137 Views)
HAMISH_MCTAVISH
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Being a millionaire is certainly not what it used to be, and even less so with the AUS$ plummeting in value, but my question to the forum is fairly simple.

Is it possible, do you think, to retire comfortably in Australia with a pot of assets, investment property, cash, and pensions totalling a million dollars?

For the sake of argument lets just say that is in addition to a small property owned outright to live in, that there is no outstanding debt on any of the IP, and that the place you want to live is a small country town within 2-3 hours drive of one of the bigger East Coast cities. Lets also say that you are young enough not to want to draw down capital, so it's the yield/income you're primarily chasing.

So.... Congratulations, you're now a millionaire.

But is this enough to live the easy life and never work again?
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stinkbug
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A million isn't enough to reliably support the lifestyle I want to retirement.
---------------------------------------------------------------

While it's true that those who win never quit, and those who quit never win, those who never win and never quit are idiots.

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Bardon
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Of course it depends on many things but I would say yes you could although there is no harm in setting your targets far higher.
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zaph
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Depends on your definition of comfortable.

With a paid off home and $1m in yielding assets you could 'retire'.
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peter fraser
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HAMISH_MCTAVISH
21 Aug 2015, 07:45 AM
Being a millionaire is certainly not what it used to be, and even less so with the AUS$ plummeting in value, but my question to the forum is fairly simple.

Is it possible, do you think, to retire comfortably in Australia with a pot of assets, investment property, cash, and pensions totalling a million dollars?

For the sake of argument lets just say that is in addition to a small property owned outright to live in, that there is no outstanding debt on any of the IP, and that the place you want to live is a small country town within 2-3 hours drive of one of the bigger East Coast cities. Lets also say that you are young enough not to want to draw down capital, so it's the yield/income you're primarily chasing.

So.... Congratulations, you're now a millionaire.

But is this enough to live the easy life and never work again?
Hi Hamish, long time no see.

I would say that under the conditions you outlined it is possible while interest rates remain low.

It won't be a luxurious lifestyle though. Slightly above the aged pension level.
Any expressed market opinion is my own and is not to be taken as financial advice
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lextsy
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I think the better question would be, what is the minimum weekly income(From rent or other assets) you could live on for the rest of your life. Assuming I stay single and do not need to provide for anyone would 1000 a week be enough for me to live a happy life? It seems like a lot but when you factor in health and one off purchases like a car or a vaction suddenly you find the money skimping. A million @ 1000 per week is 1000 weeks which is under 20 years so unless you are retiring at 70 I think it would be fair to say it is not enough money for the average guy wanting to retire at 50 etc

I think with a place to live and 1500/2000 a week I would be a happy man which means I better get that garage extension approved
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HAMISH_MCTAVISH
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lextsy
21 Aug 2015, 09:32 AM
I think the better question would be, what is the minimum weekly income(From rent or other assets) you could live on for the rest of your life. Assuming I stay single and do not need to provide for anyone would 1000 a week be enough for me to live a happy life? It seems like a lot but when you factor in health and one off purchases like a car or a vaction suddenly you find the money skimping. A million @ 1000 per week is 1000 weeks which is under 20 years so unless you are retiring at 70 I think it would be fair to say it is not enough money for the average guy wanting to retire at 50 etc

I think with a place to live and 1500/2000 a week I would be a happy man which means I better get that garage extension approved
Figuring out how much you'd need to live on is important, I reckon assuming you had no mortgage to pay, had all the toys you need to keep busy/entertained and didn't need to replace your toys more than once a decade or so, then 1000-1500 a week is probably pretty comfortable even for a couple.

So that puts your annual income requirement at around 50K to 75K in Aussie dollars.

That needs a yield of 5% to 7.5% on the cash/assets in order to not spend down capital, and actually a bit more if you need to keep the capital base growing to adjust for inflation, unless it's all invested in assets that also appreciate over time.
peter fraser
21 Aug 2015, 08:51 AM
Hi Hamish, long time no see.

I would say that under the conditions you outlined it is possible while interest rates remain low.

It won't be a luxurious lifestyle though. Slightly above the aged pension level.
Hi Peter, thought I'd drop in and say G'day... :)

What's the aged pension level in Aus these days?
Edited by HAMISH_MCTAVISH, 21 Aug 2015, 09:42 AM.
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Will
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I think yes, like Peter, I wouldn't expect a luxury lifestyle, but the reality is, most people are going to retire on substantially less then that. I would suggest if you look at studies already out there, right now I think only about 10 percent or less end up with a mill or more.

Now from my perspective, I would expect a return on the 1 mill plus some burning of the capital to provide the retirement. I wouldn't expect much or a lifestyle on just the yield on the million.
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Frank Castle
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Business As Usual

Can you retire on a million dollars?
Plenty do it on a hell of a lot less.
Ignore posts by The Whole Truth · View Post · End Ignoring
The forum fuckwit goes RRRAAARRRGGHHhhh - But not a fuck was given..................by anyone.
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HAMISH_MCTAVISH
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Frank Castle
21 Aug 2015, 09:55 AM
Can you retire on a million dollars?
Plenty do it on a hell of a lot less.
Sure, not everyone can acquire that much, but I'm simply asking if it's enough to live a comfortable middle of the road lifestyle in Aus today if you do and never have to worry about working again.
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