Upticks: Can You Retire with $1,000,000?
By Luke Sullivan on March 27, 2025
Can you retire with a million dollars? Yes! Kind of… While $1,000,000 isn’t what it used to be, it’s important to understand what it means to you. Jake and Cory discuss cash flow in retirement and how different income sources contribute to your financial plan. Honesty and self-reflection are arguably as important as the dollars in your accounts. Tune in for scenarios and client stories from our wealth advisors.
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Read an overview of the conversation below:
Can You Retire with a Million Dollars?
The short answer is yes! Only in the sense that it is theoretically possible. Jake and Cory tackle this question head-on, providing a nuanced perspective that goes beyond the headlines. Cory starts by saying, “It all depends on your plan and your situation and your circumstances. We’ve, Jake, both worked with clients that have retired with a lot more money and a lot less money than a million dollars”.
This statement sets the stage for a deep dive into the complexities of retirement planning. Jake emphasizes the importance of cash flow in retirement planning. He explains, “The key point to remember, and I want to talk about with you, Cory, is cash flow. So let’s go over an example”.
The Importance of Cash Flow
Jake provides a detailed scenario to illustrate his point: “If you are 70 years old and you retire, or 60 years old, it doesn’t matter, and you’re married, and you and your spouse have both maxed out Social Security, so you’re going to get the max benefit from Social Security. Let’s say you’re both going to get $3,000 each. So, there’s $6,000. And let’s say you happen to work at a company that has a pension that’s going to pay you another $3,000. So, between you and your spouse, you’re going to get $9,000 a month in income for your lifetime”. Jake makes the point that if you live on $10,000 per month in this scenario, you would only need to spend $1,000 monthly from your retirement savings. This example underscores the importance of understanding one’s income sources and how they contribute to the overall financial plan.
Jake further elaborates on the importance of cash flow by providing another example: “Let’s say you’re 55 and you’ve got a million bucks and maybe you’ll get Social Security at 62 or whenever you turn it on. But let’s say you need to spend $15,000 a month to sustain your lifestyle. Maybe you’ve got two homes with mortgages. Maybe you’ve got a boat. Maybe you’ve got car payments. Maybe you’ve got credit card debt. You’ve got bills to pay. You can’t cut them. You owe these things”. In this scenario, you continue work to build up a more robust retirement savings may be best.
Honesty and Self-Reflection
Cory adds another layer to the conversation by stressing the importance of honesty and self-reflection in financial planning. He says, “You’ve got to be honest with yourself about what’s important to you, about what you really need, and you know what you’re willing to sacrifice”. This candid guidance serves as a reminder that successful retirement planning involves not only financial acumen but also a deep understanding of one’s values and priorities.
Jake and Cory discuss the importance of setting realistic expectations and being prepared for the unexpected. Cory shares, “Recognizing that where you pull money from, particularly if it’s treated as taxable income, can directly influence how cheap or expensive your healthcare is”. This insight highlights the interconnectedness of various financial decisions and the importance of a comprehensive approach to financial planning.
Cory also emphasizes the importance of being honest with oneself about spending habits and lifestyle choices. He explains, “When the paychecks go away, almost regardless of how much money someone has, if it’s a million dollars or $10 million dollars or $100,000, somewhere in between, you’ve got to be honest with yourself about what it is that’s important to you and what you want to spend your money on and what it is that you really need to live comfortably”.
The Role of a Financial Advisor
Throughout the episode, Jake and Cory highlight the potential value of working with a financial advisor. Jake notes, “If you really want to know if a million dollars will cut it for you and your family, you got to meet with us or meet with a fiduciary wealth advisor that can crunch those numbers”. This professional guidance can provide clarity and confidence, helping individuals navigate the complexities of retirement planning.
Jake and Cory emphasize the importance of ongoing communication and collaboration with a financial advisor. Jake explains, “Our clients are our bosses. We hear that loud and clear. But I can’t wave a magic wand and say, all right, boss, everything’s going to be all right. You spend whatever you want. We’ll make it work. Like, that’s not how this works”. This honest and transparent approach builds trust and helps ensure that clients are well-informed and empowered to make the best decisions for their future.
Jake further elaborates on the importance of working with a financial advisor by sharing a real-life example: “I was meeting with a client the other day and they’ve got a great financial plan, but we were showing them spending $150,000 a year versus $180,000 a year retiring at different points. And it was a million-dollar difference. So, for this particular client, they needed about a million dollars more to be able to spend more, and that equated to working some more years and saving more”.
A Million Dollars Isn’t What It Used to Be
Jake reflects, “I don’t have the numbers in front of me, Cory, and I’m a little bit older than you, but like when I was a young boy, a million dollars was a lot of money in the eighties. In the early 90s, a millionaire was like, whoa, you’re a millionaire?”.
Jake continues, “Now, and I don’t want to discount this. If you’re a millionaire, if you have a million dollars and you’re watching this, congratulations, by the way. Because it’s not easy to save a million bucks still. It’s a lot of discipline to do that. But the reality is a million dollars just doesn’t buy what it used to buy. And that’s called inflation. And, you know, in the eighties and nineties, a car, a home, all that stuff was a lot cheaper”. This discussion highlights the impact of inflation on the purchasing power of money and the importance of adjusting financial plans accordingly.
Conclusion
Jake and Cory emphasize that financial planning is not just about reaching an arbitrary number but understanding one’s unique financial situation and goals. Jake explains, “You can’t just get to some arbitrary number without knowing what your financial plan is. Because everybody’s needs are different. If you’re single versus married, that’s a dramatically different financial plan”. Cory adds, “That’s true. It just is. Your spending is going to be different. One car instead of two cars. Your utility bills are cheaper. Your food bills are cheaper. It’s not in half, but it’s different”.
Jake concludes, “And like you said, Cory, I’ve had clients retire with less than a million dollars, and they’re doing great. They don’t spend that much money. Or they have a pension that’s paying them”. This holistic approach to retirement planning, which balances financial security with personal fulfillment, is a key takeaway from this episode. Whether or not $1,000,000 is enough to retire on depends on many other factors. There is no single answer to the question this episode presents.
Thank you for tuning in, we hope you have a great week!
