Million Dollar Poverty

"A nickel ain't worth a dime anymore." ~ Yogi Berra

When I was growing up, a million dollars or being a millionaire was the holy grail.  I thought I would have it made if I could accumulate a million dollars.  It definitely would have been enough

Nowadays, a million dollars may not be enough according to CNBC for today's retirees.   A million dollar nest egg would yield $40,000/year using a 4% withdrawal rule.   This would last about 12 to 25 years depending on one's state of residence.   For 42 year old GenXer, the withdrawal would be $19,000/year inflation adjusted.   The articles notes for a 32 year millennial, the withdrawal would be below the poverty line, which the article characterizes as "million dollar poverty."

Given inflation and longer life expectancies, I estimate the nest egg holy grail for our kids will be at least $5 million...or even more.  

For more on Crossing Generations, check back Thursdays for a new segment.

This is not financial or retirement advice. Please consult a professional advisor.

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