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Would a million dollars be enough to retire early and live

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chanta76
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Would a million dollars be enough to retire early and live

Post by chanta76 » August 21st, 2017, 4:20 am

I know every country is different but what would be the minimum amount you need to retire and live in another country? Let say I have about million dollars and I'm in my 40's. Decide to retire and move to south East asia like Philippines or THailand. Would that be enough?

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Yohan
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Re: Would a million dollars be enough to retire early and li

Post by Yohan » August 21st, 2017, 8:27 am

chanta76 wrote:I know every country is different but what would be the minimum amount you need to retire and live in another country? Let say I have about million dollars and I'm in my 40's. Decide to retire and move to south East asia like Philippines or THailand. Would that be enough?
If you are only 40 and expect to live up to 85, it would be

USD 1.000.000 /45 years/ 12 months - this means about USD 1850,- per month. In Thailand this is about THB 60.000,-.

A bit critical if you ask me, if you consider for example medical fees, buying a nice condominium, and we foreigners cannot live cheap like locals, we have to consider some different food, also some security issues, sometimes visa fees, airtickets... There are also some other expenses, like women or cars...

If you are alone, healthy up to your death, maybe OK, but we do not know our future...

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Zambales
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Re: Would a million dollars be enough to retire early and li

Post by Zambales » August 21st, 2017, 11:59 am

Easily - if you're smart enough. :wink:

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Yohan
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Re: Would a million dollars be enough to retire early and li

Post by Yohan » August 21st, 2017, 2:55 pm

Zambales wrote:Easily - if you're smart enough. :wink:
Not so easy, just my experience. I met men who arrived in Thailand with not so little money, they got yellow fever and left after a few years with nothing...

Generally said, baht 60.000,- is not so much money in Thailand for a foreigner, if you like to own your nice rooms, like to have a small car, go out sometimes for dinner, invite sometimes a girl to join, need occasionally a medical doctor, prefer not to eat the cheapest meals etc. etc.

Contrarian Expatriate
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Re: Would a million dollars be enough to retire early and li

Post by Contrarian Expatriate » August 21st, 2017, 3:27 pm

Yes, so long as you are single and have not debt. If you are married with children, it might become necessary to rely on additional income to purchase a house, second car, tuition for kids, etc.

To put it in perspective, 1 million dollars puts you in the top 3% in terms of world wealth. That being the case, a million of liquid cash is more than enough to live on if you have most of it invested in passive income producing vehicles. Those can be tricky in a low interest rate environment like today, but overseas they can be easier to find.

I encourage people to read the book, "The Millionaire Next Door" to absorb just how easy it is to achieve a million when you live below your means and invest your disposable income early and long term.

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Zambales
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Re: Would a million dollars be enough to retire early and li

Post by Zambales » August 21st, 2017, 3:54 pm

Yohan wrote:
Zambales wrote:Easily - if you're smart enough. :wink:
Not so easy, just my experience. I met men who arrived in Thailand with not so little money, they got yellow fever and left after a few years with nothing...

Generally said, baht 60.000,- is not so much money in Thailand for a foreigner, if you like to own your nice rooms, like to have a small car, go out sometimes for dinner, invite sometimes a girl to join, need occasionally a medical doctor, prefer not to eat the cheapest meals etc. etc.
Invest some of the money like Contrarian said to create a passive income.

You could use 25%-30% of the million to buy a property in your home country, rent it out, and use that income for the essentials in SE Asia. What you have left could be invested further or you could use the interest accrued to pay for the non essentials. It'll be a nice problem to have but it's definitely achievable.

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Yohan
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Re: Would a million dollars be enough to retire early and li

Post by Yohan » August 21st, 2017, 8:41 pm

https://www.yahoo.com/news/m/872db09b-1 ... go-in.html
How Far Does $1 Million Go in Retirement?
•August 21, 2017
A million dollars—it has a nice ring to it. But as Dr. Evil learned after spending 30 years cryogenically preserved, it may not be enough—for many people, certainly not enough to comfortably retire on, depending on where and how long they live. A new report from GOBankingRates measures how long a million dollars would last for retirees 65 and older, state by state. It did that by multiplying the Bureau of Labor Statistics' mean annual expenditures for that age group by a cost-of-living measure for each state, provided by the Missouri Economic Research and Information Center. The tally separated out annual spending on health care, housing, groceries, transportation, and utilities.

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Yohan
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Re: Would a million dollars be enough to retire early and li

Post by Yohan » August 21st, 2017, 8:56 pm

Zambales wrote: Invest some of the money like Contrarian said to create a passive income.

You could use 25%-30% of the million to buy a property in your home country, rent it out, and use that income for the essentials in SE Asia. What you have left could be invested further or you could use the interest accrued to pay for the non essentials. It'll be a nice problem to have but it's definitely achievable.
With only USD 250.000,- you cannot buy any reasonable property here in Metropolitan Tokyo - only a small one-room second-hand condominium unit.
Consider around USD 600.000,- for a 800 square feet condominium unit or very little house/land and this is by far not a prime location.

It's possible to survive with one million USD over decades, if you are very careful with money and continue your life as a single and in a very modest way of life while being only 40 years old while living in a low-cost country, but money is difficult to control for most people.

HouseMD
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Re: Would a million dollars be enough to retire early and li

Post by HouseMD » August 22nd, 2017, 7:42 pm

At that level of savings one could theoretically retire indefinitely on $40,000 at a 4% drawdown with expected returns of 7%. Taxes on capital gains are 15%, so 40k goes a lot further when its investment money.

CannedHam
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Re: Would a million dollars be enough to retire early and li

Post by CannedHam » August 23rd, 2017, 9:02 pm

HouseMD wrote:At that level of savings one could theoretically retire indefinitely on $40,000 at a 4% drawdown with expected returns of 7%. Taxes on capital gains are 15%, so 40k goes a lot further when its investment money.
4% seems a bit high for early retirement. Most would recommend 2.5-3%, which would still be 25-30k/year with no capital gains taxes (he'd likely be in the 0% CG rate).

Also, if you're 45 years old, you probably should see some social security in your 60s, don't forget to factor that in!

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Re: Would a million dollars be enough to retire early and li

Post by HouseMD » August 23rd, 2017, 9:10 pm

CannedHam wrote:
HouseMD wrote:At that level of savings one could theoretically retire indefinitely on $40,000 at a 4% drawdown with expected returns of 7%. Taxes on capital gains are 15%, so 40k goes a lot further when its investment money.
4% seems a bit high for early retirement. Most would recommend 2.5-3%, which would still be 25-30k/year with no capital gains taxes (he'd likely be in the 0% CG rate).

Also, if you're 45 years old, you probably should see some social security in your 60s, don't forget to factor that in!
4% is the generally conservative number if you're invested in the market, as it assumes a 4% withdrawal rate on 7% investment returns, for 3% growth per year (2% lower than annualized historical S&P 500 returns in total) which is enough to keep up with inflation. Pulling out less delays retirement or reduces the quality of your retirement with very little difference in your money lasting longer (you go from a 1 in 25 chance of failure to a 1 in 40, significant but unlikely top matter, it's literally 4% vs 2.5% but you're suffering a lot more for that extra 1.5%). Use FireCalc to figure out what will likely work for your individual risk tolerance and desired lifestyle.

HouseMD
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Re: Would a million dollars be enough to retire early and li

Post by HouseMD » August 23rd, 2017, 9:10 pm

CannedHam wrote:
HouseMD wrote:At that level of savings one could theoretically retire indefinitely on $40,000 at a 4% drawdown with expected returns of 7%. Taxes on capital gains are 15%, so 40k goes a lot further when its investment money.
4% seems a bit high for early retirement. Most would recommend 2.5-3%, which would still be 25-30k/year with no capital gains taxes (he'd likely be in the 0% CG rate).

Also, if you're 45 years old, you probably should see some social security in your 60s, don't forget to factor that in!
4% is the generally conservative number if you're invested in the market, as it assumes a 4% withdrawal rate on 7% investment returns, for 3% growth per year (2% lower than annualized historical S&P 500 returns in total) which is enough to keep up with inflation. Pulling out less delays retirement or reduces the quality of your retirement with very little difference in your money lasting longer (you go from a 1 in 25 chance of failure to a 1 in 40, significant but unlikely top matter, it's literally 4% vs 2.5% but you're suffering a lot more for that extra 1.5%). Use FireCalc to figure out what will likely work for your individual risk tolerance and desired lifestyle.

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