Would $1.5 Million Be Enough to Retire Comfortably?

If you’re trying to determine if $1.5 million will last you through retirement, you’ll need to consider your Social Security, pension, other retirement income, and your fixed and variable expenses. Significant factors include how long you expect to live in retirement and spending time in that phase of life. A financial planner can assist you in developing a strategy to meet your retirement income objectives.

For several reasons, knowing whether or not $1.5 million is sufficient to retire comfortably is difficult. Here are seven factors that tend to be taken into account:

Social Security.

As of November 2024, the typical monthly Social Security payment is $1,551.66. The annualized rate would be $18,619.92 per month. It would be challenging to make ends meet on that amount alone in retirement, but it could be a welcome supplement if other provisions have been made. To account for rising prices, Social Security recipients can count on an annual cost-of-living adjustment (COLA) from the Social Security Administration (SSA). Therefore, despite rising costs, these payments should still be a welcome addition to Social Security.


Per the U.S. Census, pension and retirement income averaged $8,538 in 2017. However, this total does not account for retirement or pension income. Even though pensions are becoming less common in the private sector, they can still provide a welcome financial boost in retirement. Careers in state and local government, education, and the financial industry are examples of possible occupations that still offer pensions.

Total retirement funds.

According to the Census Bureau’s estimates for 2021, the average income of Americans 65 and older was $47,620. The Census considers various income sources, not just Social Security and pensions. As was previously mentioned, the Census combined retirement and pension income into a single figure of roughly $8,500. If we exclude retirement and pension funds from this calculation, however, the average household earns $39,082 annually. These days, few people can rely on a pension for their retirement, so this number accurately represents the income the typical family brings in outside retirement.

4% as the bare minimum requirement.

The “four percent rule” is often referenced as a rule of thumb in personal finance. Using this guideline, you can take out no more than 4% of your portfolio each year without worrying about it. That sum is equivalent to $60,000 from a $1.5 million investment portfolio. If your investment portfolio still contains some stock, it may grow even as you take money out. According to research, under this rule, most portfolios would last for 30 years, and in some cases, even 50 years. Combined with the average of traditional and supplemental Social Security, this yields an annual income of $76,840. Earnings, pensions, and other forms of property income are excluded.

What is the typical retiree budget?

The data collected by the Bureau of Labor Statistics in May 2014, the average annual spending of people aged 65 to 74 was $48,885. In today’s money, that is equivalent to $61,175 before inflation. Even if you have no savings or investments to draw on in retirement, you should be okay financially. Of course, there are several qualifiers, one of which is the predictability of Social Security benefits. However, if you want to retire now, $1.5 million should be more than enough. When working out your budget, here are two things to keep in mind:


Remember that the averages we’ve discussed here are just that; there’s no guarantee that they’ll be enough to fund a comfortable retirement for everyone. For instance, more than $1.5 million might be required if you’ve worked hard and now want to live a life of luxury, complete with frequent international travel and elaborate social gatherings. You may need extra money because of unexpected expenses or because you live in a high-cost area. In such instances, you may need to make some changes.

Costs associated with healthcare.

Medical costs can range widely, but they can be high for some people. When it comes to healthcare costs, for instance, Fidelity estimates that a retired couple in their 65s will need around $315,000. And while that sum is a prognostic estimate for the rest of your life, let’s assume you make it to 85. An additional $15,750 per year, or $7,875 per person, would be required to accomplish this. If both of us were to work, our combined income of $76,840 would put us up against our retirement savings.

Most people never even make it to the seven-figure income mark, so having a portfolio worth $1.5 million is a significant accomplishment. And that sum, in most cases, is enough to ensure a pleasant retirement. Unfortunately, not everyone will be able to benefit from it. In some cases, more than $1.5 million might be required; for instance, if you plan on retiring in style or settling in a high-cost region. To sum up, the answer to the question at hand is “it depends,” as is often the case in money matters. To know how to retire comfortably, you should talk to a financial planner.

Advice for Retirees

Financial advisors can help you determine how to invest your money and make other major financial decisions. Begin your search for a financial advisor immediately if you’re serious about reaching your goals.