No, I wouldn't feel rich. I would feel secure. My financial planner suggests that if I have $800,000 in the bank by the time I'm 55 then I could retire at 59, and help my child get through college (probably a state school) without taking on more than $25,000 or so in SallieMae debt. At 4% income, $800k will give me $32,000 a year. The house won't be paid off, but I'll have two or maybe three hundred thousand in equity by then. I'll have to sell it and find something much smaller. Since the badness, my annual contributions need to be about $8k more than I last budgeted, to make this happen on schedule. It's probably the college fund that will get short shrift, because, as the financial planner also remarked, you can get a student loan, but you can't get a retirement loan. I really hope that doesn't make my son decide to skip college. I hear a lot of that lately.
So, no. If I had a million dollars, I would not feel rich. But I would stop weighing my son's preparation for the future against my own security in old age. I would stop putting 20% of the household income into savings, and call the retirement fund done. With that bump, I might get my son out of public school and into private. I would certainly keep working, and clipping coupons, and not going out to eat much. I might get the occasional vacation. I would stop worrying that I don't know any software developers over age 50 or so, and wondering what happens to them. Do they all retire early? Voluntarily?
I talk to people and wonder what their retirement planning is like. The one topic related to finances that people talk about is their insane credit card debt. Does that mean they have no savings? Are they making IRA and Sep contributions with great discipline, and running up retail debt at the same time? Do they get that a time will come when they can no longer earn a living? And a time even sooner when they won't want to? Why isn't everyone else as freaked out as I am? Or are they?
So, no. If I had a million dollars, I would not feel rich. But I would stop weighing my son's preparation for the future against my own security in old age. I would stop putting 20% of the household income into savings, and call the retirement fund done. With that bump, I might get my son out of public school and into private. I would certainly keep working, and clipping coupons, and not going out to eat much. I might get the occasional vacation. I would stop worrying that I don't know any software developers over age 50 or so, and wondering what happens to them. Do they all retire early? Voluntarily?
I talk to people and wonder what their retirement planning is like. The one topic related to finances that people talk about is their insane credit card debt. Does that mean they have no savings? Are they making IRA and Sep contributions with great discipline, and running up retail debt at the same time? Do they get that a time will come when they can no longer earn a living? And a time even sooner when they won't want to? Why isn't everyone else as freaked out as I am? Or are they?