"First, she said that $2 million isn't nearly enough to retire early on. She then went on to say that it might take a good $5 to $10 million to retire early without financial worries. Yep, you read that correctly. Are you shocked? Well, maybe you shouldn't be. In the past few years, we've seen inflation drive living costs up dramatically. And it's hard to predict how much havoc inflation will continue to wreak."
"Of course, the amount of money you need for early retirement depends on how you define that. For some people, retiring early means ending their careers at 60. For others, it means leaving the workforce behind at 40. There's a huge difference between those two ages, though. In one case, you might need your retirement savings to last 50 or 55 years, whereas retiring at 60 could mean savings for 30 or 35 years."
Retiring decades earlier than typical substantially increases the amount of savings required. Inflation-driven higher living costs and uncertain future inflation raise required nest-egg estimates. Early retirement at age 40 may demand funds to cover 50 to 55 years of expenses, while retiring at 60 often requires funds for roughly 30 to 35 years. A $2 million nest egg may be insufficient for long early retirements; $5 million to $10 million may be needed to avoid financial worries if pursuing a decades-long retirement. Retirement needs should align with desired lifestyle, anticipated expenses, and exact retirement age.
Read at 24/7 Wall St.
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