A million dollars isn't cool. You know what's cool? Two million.
That's according to a recent USA Today article, which claims that having $1 million saved for retirement might not cut it.
"The new $1 million may be $2 million," it says.
Financial professionals explain that $1 million of retirement savings translates to $40,000-$50,000 annually once you've bowed out of the workforce. Sure, someone could live on that, but the question is: could you?
From USA Today:
"Everything is relative," says Clarence Kehoe, executive partner in the accounting firm Anchin, Block & Anchin in New York City. "For some people, I would think $1 million would be more than enough. For other people, I can tell you some of these clients spend more than $1 million in a year. It depends on the person, their lifestyle, and what they are used to."
The idea of "downsizing" is pretty common, but many of us mean our homes - not necessarily our lifestyles. Does your dream retirement include an annual European river cruise, lavish gifts for your loved ones, or perhaps a little help for the grandchildren in the college department? In that case, $1 million might not be enough.
Even if you don't plan to travel the world or put three grandchildren through school, one financial professional tells USA Today that although people expect to spend less money in retirement, the truth is that they might be spending more. It makes sense when you think about it: Besides potentially higher medical bills, retirees have nothing but time to spend golfing, eating out, shopping … and paying for it.
Sure, we envision reading a free library book on the porch in retirement - but could you really do that for 30 years? If not, it might be time to adjust those savings goals.