How much do you really need to spend $10,000 a month in retirement?

A new client came in recently and asked:

“Andrew… once I retire, do I actually have enough to spend $10k a month?”

They had $1.6 million in their 401(k) and knew the 4% rule:

The rule of thumb that says you can withdraw about 4% of your starting balance each year, adjusted for inflation, and historically you could expect that money to last around 30 years.

They ran the numbers and were a little panicked.

Because by that rule alone,
$1.6 million = about $5,300 per month.

But that’s not the full story.

When we zoomed out and looked at the whole picture:

• Their Social Security added roughly $4,000/month
• A rental property added another $1,000/month

Now all of a sudden, they were north of $10,000/month.

But here’s the important part.

The 4% rule isn’t really a rule. It’s a guideline. And not a guarantee.

For it to work, it assumes:

• You’re invested properly for the long term (not sitting in cash)
• Markets behave like they have in the past, over time
• You don’t abandon the plan during downturns
• You have a well-develop income plan and budget

So the “rule’ gives us a nice place to start.

But what really matters is the detailed planning to see how much you really need to reach your goals.

👉 If you’re within a few years of retirement and asking “Do I really have enough?”, be sure you are working with your financial planner to eliminate the guesswork.

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