Don’t Believe This Million-Dollar Lie About Retirement

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Posted by The Savvy Retiree on August 9, 2020 in Retirement Finances

“Screw society. Living up to anyone’s expectations except your own is a pointless way to go through life.”

You might call that the summary of a very short conversation—by way of text messages—I had this past week with my son back in Louisiana. Kid’s smart as a whip, but clearly not built for the antiquated teaching methods of the U.S. university system that require students waste time and money on classes that are useless to their interests. He’s calling it quits and, instead, wants to pursue his real estate license because, he told me, “I really love dealing with houses.”

I told him I think it’s a brilliant idea.

And it got me to thinking about us—Gen Xers and baby boomers.

So many of us—and I know I was one—have lived our decades largely trying to live up to one specific expectation: Amass a million dollars or more so that we can live a comfortable retirement. Otherwise, the media essentially says, we might as well stock up on off-brand cat food and consider euthanasia.

Having spent decades writing about and reporting on Wall Street, I have a sneaking suspicion this “save $1 million before you retire” nonsense was birthed inside a financial-planning firm or maybe a brokerage firm—a means of scaring people into saving more so that brokers and planners could hoover up more assets from which they can leach their fees.

This lunatic idea that we all need a million dollars or more has become such accepted wisdom that it’s pretty much all you read about in the mainstream financial media when it comes to retirement planning: How to save $1 million by 65; How to save $1 million on a penny a day; Stop Drinking Frappe Macchiatos NOW and Save $1 Million by Next Tuesday.

Don’t have a million dollars yet? Loser!

In truth, this quest for a million dollars is bogus click-bait. Henceforth all of us should, frankly, ignore and boycott any media outlet that jabbers on about this. They are doing all of us an emotional disservice. They’re the ones helping drive Americans’ declining sense of happiness, and fomenting our financial fears.

The vast majority of Americans have not accumulated—and never will accumulate—$1 million. And yet, look around you: How many retirees do you know who are living a happy life today, even though they’ve not saved a mil?

I would venture to guess that the vast majority of retirees are absolutely not millionaires—proof that a quantity of dollars does not define retirement happiness.

Retirement happiness is living a richer life on the assets and income you have, and the income you can generate in an era when age is no longer the limiting factor it once was. I read every story in The Savvy Retiree each month, and I read every issue of International Living. And every month, I’m pulled in by at least one story in which someone is living their best life and truly loving it, even though they’re not a member of the Millionaires’ Club.

Maybe you saw this in the most recent issue of The Savvy Retiree—a story from Cassandra Ellis, a court reporter for nearly three decades now. She had a chance to spend a year sub-letting a friend’s apartment in Hamburg, Germany. But Cassandra’s not so rich that she can just jet off to Europe and not worry about money.

So, she tapped into freelance opportunities as a proofreader specializing in the editing and proofing of court testimony, arbitration hearings, and similar documents. The pay is pretty good, upwards of $1,600 a week. But the bigger point to Cassandra’s story, at least to me, is that there are classes one might take to become a proofreader who specializes in proofing these types of documents. No one is going to care how old you are…or where you work…or when you work. So long as your proofreading skills are up to snuff, you’re hired. You have an income source.

When you can earn decent income anywhere you want to be, and on your terms…well, that’s just further proof that telling people to save a million dollars before retirement is 20th-century thinking.

So don’t buy into this notion of this million-dollar lie. It’s just not true, and not feasible for the vast majority of Americans. Nowadays, they are so many ways to fund your life in retirement, and there are so many ways you can reduce your retirement costs radically (a primary option being moving to a lower-cost state or a lower-cost country where Social Security alone will cover all or most of your living expenses…but that’s an entirely different column).

So, toss aside expectations. Trying to live up to the $1 million challenge is a pointless way to approach retirement.

By Jeff D. Opdyke