Can you retire on $700k [Updated April 2024] (2024)

However, it will also depend on how old you are when you retire and how much you plan to spend each month as a retiree.

Assuming an average annual return of 6% before taxes and a 22% federal tax rate, the table below offers a detailed breakdown of how long $700k can last across various annual spending scenarios:

Initial savingsAnnual spendingEnough?Ending balance after 25 yearsRequired initial savings
$40,000Yes$518,755$613,077
$50,000No$213,511$775,385
$700,000$60,000No-$91,733$937,692
$70,000No-$396,977$1,100,000
$80,000No-$702,222$1,262,308

If you’re struggling to work out how much money you’ll need in retirement and how much you’ll need to save, a financial advisor can help. They will work with you to understand your unique needs and create a retirement savings plan to make your money go further. Match with a financial advisor below.

How long will $700k last in retirement?

$700k can last you for at least 25 years in retirement if your annual spending remains around $40,000, following the 4% rule.

However, it will depend on how old you are when you retire and how much you plan to spend each month as a retiree.

Assuming an average annual return of 6% before taxes and a 22% federal tax rate, the table below offers a detailed breakdown of how long $700k can last across various annual spending scenarios:

Spending Per YearYears It Will LastTotal InterestTotal WithdrawalTotal Taxes
$30,00032$1,440,000$960,000$211,200
$40,00024$1,260,000$960,000$211,200
$50,00019$1,140,000$950,000$209,000
$60,00015$900,000$900,000$198,000
$70,00012$720,000$840,000$184,800
$80,00010$600,000$800,000$176,000

Retirement plans, annuities and Social Security benefits should all be considered alongside the figure you have sitting in savings, and you should also bear in mind that expenses as a retiree tend to be low. Especially if any children are now financially solvent adults and large loans, such as your mortgage, have been paid off.

Can I retire on 700k plus Social Security?

Is $700k Enough to Retire On With Social Security?

Retiring comfortably takes more than just money in the bank - it also takes proper planning. With $700,000 in personal savings, plus income from Social Security payments, you have a solid foundation to work with.

However, there are still variables to consider. Your annual Social Security benefit can range anywhere from $15,000 to the maximum of around $40,000 per year, depending on your past earnings history and when you start taking payments. Your spending habits and lifestyle desires in retirement are also key factors.

Additionally, with average life expectancies continuing to increase, your retirement savings may need to last 25 years or more. It's important to calculate all these variables, project future returns, and define your must-have retirement goals before deciding if $700k is truly enough for you. Meeting with a financial advisor can provide personalized guidance based on your situation.

What are the income taxes applicable to retirees with $700k?

When working through your later-life financial checklist to prepare for retirement, you must consider how taxes will factor in. You’ll need to know how much they will reduce your final amount of accessible income. With $700,000 in savings, your tax bill still won’t likely be exorbitant – especially if you withdraw funds gradually over 20+ years. But your liability will come down to:

  • Your filing status (single filer, head of household, married filing jointly, etc.)

  • Where you live (different states have different tax rules)

  • Where your retirement income is from (rules differ based on source)

  • Your total annual income

If you have a traditional pre-tax IRA, distributions will be taxed. But if you have an after-tax Roth IRA, you’ve already paid taxes on contributions so can withdraw tax-free.

Here’s an example: You retire at 65 and your goal is for savings to last 20 years. Spreading $700,000 over 20 years means monthly withdrawals of $2,917 and annual income of $35,000. This would place you in the 22% federal income tax bracket for a single filer.

Can you retire at 50 with $700k?

It’s certainly possible to retire early at 50 with $700,000 in savings, but you’ll likely need to make some lifestyle adjustments.

Using the 4% safe withdrawal rate, you could take out $28,000 per year, or $2,333 per month. This should last you for 30 years until age 80 assuming average market returns. If you estimate living longer to 85 or 90, the amount would be reduced some.

Overall, with a frugal budget of $28,000 or less in annual spending, retiring fully at 50 should be achievable. Even if you can't quite get there by 50, you'd be on track to achieve it in your mid-50s potentially.

The keys will be controlling expenses, utilizing tax-advantaged accounts strategically, having supplemental income sources if possible, and making sure you have health insurance coverage figured out. With proper planning and discipline though, many find $700k is an adequate amount to retire on at 50.

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Three routes to increased savings

You may now want to figure out how to increase your savings, growing that $700,000 to $800,000 or more to give yourself some additional breathing room. Some extra disposable income as a retiree. Our best recommendations are as follows:

  1. Adjust your monthly budget and save where possible – try to avoid regularly spending your money on unnecessary things that matter less to you, in the grand scheme of things, than a happy and comfortable retirement. Set achievable lifestyle and financial goals with proper consideration of your future self. Cut back where you can, and redirect that money where it can be better used.

  2. Build a varied portfolio of investments, seeking expert advice – a solid and stable investment portfolio comprising several types of securities could be very helpful to you, significantly boosting your savings and improving your retirement. If you don’t know where to begin, speak with an expert financial advisor to get started on your journey into investing.

  3. Find the right retirement and pension products – many different savings accounts and products are available that can be helpful to you as a retiree. Annuities, for example, convert your savings into a guaranteed monthly income for a given period. This period could be the rest of your life if you purchase an annuity with a lifetime income rider.

The bottom line

If you’ve managed to save $700k for retirement, this is a viable savings for your post-work life.

This will guarantee you a valuable degree of security and comfort in your later years, and it’s a figure many will never reach

For retirement planning advice and investment guidance, connecting with an experienced financial advisor is highly recommended. They can guide you through the daunting world of retirement planning and lead you to success. Get started with Unbiased and find your perfect match.

Can you retire on $700k [Updated April 2024] (2024)

FAQs

Can you retire on $700k [Updated April 2024]? ›

$700k can last you for at least 25 years in retirement if your annual spending remains around $40,000, following the 4% rule. However, it will depend on how old you are when you retire and how much you plan to spend each month as a retiree.

How much will 750k last in retirement? ›

Drawdown and Spending

The money might last 25 years. Under the 4% method, investment advisors suggest that you plan on drawing down 4% of your retirement account each year. With a $750,000 portfolio, that would give you $30,000 per year in income.

How long will $800 000 last in retirement? ›

Can you retire at 50 with $800k? It is certainly possible to retire by age 50 with $800,000 in the bank, but you would need to adopt a relatively frugal lifestyle. Using the 4% safe withdrawal rule, you could take out $32,000 per year, or $2,667 monthly. This should sustain you for 25 years until age 75.

How long would $600,000 last in retirement? ›

Yes, it is indeed possible to retire comfortably on $600k. With an annual withdrawal of $40,000 from the age of 60 to 85, covering 25 years, this amount allows for a financially secure retirement.

How long will 900k last in retirement? ›

How long will $900k last in retirement? $900k can last you for over 25 years in retirement if your annual spending remains around $50,000, following the 4% rule.

How long would $700,000 last in retirement? ›

How long will $700k last in retirement? $700k can last you for at least 25 years in retirement if your annual spending remains around $40,000, following the 4% rule. However, it will depend on how old you are when you retire and how much you plan to spend each month as a retiree.

Can I retire with 700k? ›

For some retirees, a $700,000 nest egg could support a long and secure retirement, while for others that sum might only last a few years. Effective retirement planning requires gaining an understanding of how key elements affect the length of time a given sum will last in retirement.

What is the average 401k balance for a 65 year old? ›

$232,710

What is a good monthly retirement income? ›

Average Monthly Retirement Income

According to data from the BLS, average 2022 incomes after taxes were as follows for older households: 65-74 years: $63,187 per year or $5,266 per month. 75 and older: $47,928 per year or $3,994 per month.

Can a single person retire on $800,000? ›

Bottom Line. With $800,000 in savings, you can probably cover $4,000 in monthly living costs. However, retirement accounts alone cannot safely sustain that spending for a 25- or 30-year retirement.

What is the $1000 a month rule for retirement? ›

The $1,000-a-month retirement rule says that you should save $240,000 for every $1,000 of monthly income you'll need in retirement. So, if you anticipate a $4,000 monthly budget when you retire, you should save $960,000 ($240,000 * 4).

What is the 4% rule in retirement? ›

The 4% rule limits annual withdrawals from your retirement accounts to 4% of the total balance in your first year of retirement. That means if you retire with $1 million saved, you'd take out $40,000. According to the rule, this amount is safe enough that you won't risk running out of money during a 30-year retirement.

What is the 7 rule for retirement? ›

The 7 Percent Rule is a foundational guideline for retirees, suggesting that they should only withdraw upto 7% of their initial retirement savings every year to cover living expenses. This strategy is often associated with the “4% Rule,” which suggests a 4% withdrawal rate.

How much will $500 000 last in retirement? ›

According to the 4% rule, if you retire with $500,000 in assets, you should be able to withdraw $20,000 per year for 30 years or more. Moreover, investing this money in an annuity could provide a guaranteed annual income of $24,688 for those retiring at 55.

At what age should you have $1 million in retirement? ›

Retiring at 65 with $1 million is entirely possible. Suppose you need your retirement savings to last for 15 years. Using this figure, your $1 million would provide you with just over $66,000 annually. Should you need it to last a bit longer, say 25 years, you will have $40,000 a year to play with.

How long will $400000.00 last in retirement? ›

Safe Withdrawal Rate

Using our portfolio of $400,000 and the 4% withdrawal rate, you could withdraw $16,000 annually from your retirement accounts and expect your money to last for at least 30 years. If, say, your Social Security checks are $2,000 monthly, you'd have a combined annual income in retirement of $40,000.

How many people have 750,000 in savings? ›

Few Americans have saved more than $300,000: 4% have between $350,001 and $500,000. 4% have saved between $500,001 and $750,000 and another 4%, have more than $750,000 saved.

Is 750k enough to retire at 55? ›

If you're hoping to retire at 55, a good pension pot is somewhere between £1million and £1.5 million for a couple and £1.1 million for an individual. You'll need enough money to live comfortably for the rest of your days.

What does a 750000 annuity pay? ›

"A payout for an 80-year-old will be higher than that of a 65-year-old," Orestis said. He cited the example in which a 65-year-old might receive $59,000 a year from a $750,000 annuity, versus an 80-year-old, who might receive $75,000 per year.

Can I retire at 58 with 750k? ›

Retiring with $750,000 in a Roth IRA and $1,800 in monthly Social Security is entirely possible, but that doesn't mean that your work is over. Your lifestyle in retirement will depend entirely on how you manage this portfolio.

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