Xee wrote: ↑
Tue Mar 24, 2020 6:03 pm
The Cooler King wrote: ↑
Mon Mar 23, 2020 7:59 pm
I think you may be overstating that a bit. Let's say after taxes and y1 living expenses you could actually invest 625k into a 6% annuity. That would come out to about 40k a year for 40 years. But with inflation that 40k is not gonna be much in 40 years. And 40k doesn't take you too far most places in the country as is.
That said you could go work a low paying job and take a much smaller annual annuity every year and never really worry about your retirement or if you can afford the basics in life. Never go into debt.
Now string several of those 900k salaries together and your getting closer.
Mingo on the other hand is at 26M in career earnings. If he lived a lifestyle like a person making 150k from day 1 he could keep up that lifestyle indefinitely without working (and still have some leftover at age 100).
Key word was frugally. If he has no debt (house and car paid off) and it's just him (no kids to support) and he lives in a low-cost-of-living area, then $40k in cash a year is more enough to cover property taxes and the necessities. It won't be a glamorous life if that's what he's expecting but he would make do.
I 100% agree though that he could count on it as "F### You" money and go get whatever job he wants and use it to supplement his income.
1. That house you paid off just reduced the size of your annuity.
2. That's 40k fixed. At the end of the annuities life it'd be worth less than half
3. In did 40 years. If a guy made 900k once at age 25, that still only gets him to 65. And he hasn't worked his whole life so he doesn't even have a SS check for retirement.
4. I may have even been high on my 625k estimate as far as how much you might have leftover from that 900k salary.
Unless we're talking living in a hunting cabin off the grid frugal, 900k really isn't going to set up anyone for life without working.