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Using the standard definition of "independently wealthy" as "no longer needs to work to cover living expenses", I would say that $1MM is nowhere enough to do th
by dhd415 5y ago
Using the standard definition of "independently wealthy" as "no longer needs to work to cover living expenses", I would say that $1MM is nowhere enough to do that in almost any place in the US, especially if you have kids. I'd say at least $3MM in cash and as much as $5-6MM in higher cost-of-living areas would be required to maintain an upper middle class standard of living.
- ericmay 5y agoIf you had $1mm today you for sure no longer need to work to cover living expenses in most places in America. I guess healthcare is a question, but even then your annual income rate will probably qualify you for Obamacare subsidies. Even with kids. Though that makes the budgeting a little more tight.
- sidlls 5y agoAccording to https://livingwage.mit.edu/states/48/locations https://livingwage.mit.edu/states/48/locations (based on https://livingwage.mit.edu/resources/Living-Wage-Users-Guide-Technical-Documentation-2021-05-21.pdf https://livingwage.mit.edu/resources/Living-Wage-Users-Guide...), $1MM invested (excluding equity in a primary residence) would certainly be enough in many areas, especially the midwest and southeast. On $1MM, one can almost certainly safely take out $35k/year (after taxes on any gains) and still grow the portfolio (so as to offset inflation). That's definitely sufficient to support the barest minimum of "lower middle class" living expenses. Without kids. Add a kid and it blows right up. But, yes, to support an upper middle class style of living one would certainly need more.