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helenc asks,

Hi Intercst,

Too late - I missed the [CNN] program, the comment

A 65-year-old will need $1.5 million to retire on assuming he needs a $50,000/yr income.

Is this based on a 65 year-old withdrawing starting today? The comment after yours through me off with the 65 year-old withdrawing 30-40 years later.

Thank you,


I don't know how CNN calculated that number. The quote was a throw away line at the end of the segment on retirement.

I believe hr1975's comment about "40 or 50 years" refered to the length of the retiree's pay out period. A 65 year old has an average life expectancy of about 20 years, so it would probably be too conservative to base his retirement withdrawals on a 50 year pay out period.

The research I've done on "safe" withdrawal rates shows they decrease as the pay out period grows longer. The "100% safe" inflation-adjusted withdrawal rate for a 20 year pay out period is 4.75%, but it decreases to 3.37% if you're trying to make your money last 50 years. See the following link for more information:

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