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Americans participating in a workplace retirement plan believe they need roughly $1.28 million to retire comfortably, according to Schroders (1). So it\u2019s safe to assume that if you have nearly twice as much \u2014 or $2 million \u2014 you would retire right away.<\/p>\n
But for some millionaires, giving up their career and regular income isn\u2019t easy. Older workers might aim for \u201cjust a little more\u201d before leaving work permanently. There may be a deep-seated fear of running out of money, which keeps them working longer than they initially planned.<\/p>\n
However, here are three reasons why you may want to consider retiring as soon as you hit the $2 million milestone \u2014 plus four ways to hang on to your hard-earned cash after the paychecks end.<\/p>\n
Average life expectancy in the U.S. is 76.4 years, according to the World Health Organization (WHO), so you might think sacrificing a few more years to work harder in your late 50s and early 60s is worth it (2).<\/p>\n
After all, you have plenty of time to enjoy the fruits of your labor, right? Well, the WHO also reports that health-adjusted life expectancy is lower \u2014 just 63.9 on average.<\/p>\n
That means if you retire at 60, you may have only a few years in full health before the onset of chronic conditions or functional limitations. Beyond that point, you may gradually lose energy, mobility or the desire to travel or enjoy time with family.<\/p>\n
This sacrifice might be justified if you were at risk of poverty in retirement. But with $2 million in your portfolio, it makes much less sense to keep working and trade away the healthiest part of your golden years.<\/p>\n
Read More: Robert Kiyosaki warned of a ‘Greater Depression’ \u2014 with millions of Americans going poor. Was he right?<\/a><\/p>\n According to LongTermCare.gov, about 60% of Americans will need some kind of assistance as they age (3). And the annual cost of care can be steep, reports SeniorLiving.org (4):<\/p>\n $75,756 for an assisted living facility<\/p>\n $80,300 for a home health aide<\/p>\n $118,104 for a shared nursing home room<\/p>\n $135,528 for a private nursing home room<\/p>\n While it\u2019s understandable to be concerned about the cost of care as you get older, that doesn\u2019t necessarily mean you need to keep working to offset those expenses. Instead, consider protecting your wealth by planning ahead.<\/p>\n With GoldenCare\u2019s long-term care insurance<\/a>, you can get things like nursing homes, assisted living and home health care covered so you don\u2019t have to pay out of pocket and deplete your $2 million nest egg.<\/p>\n All you have to do is fill in a little information about yourself, and GoldenCare<\/a> will provide you with a free quote for long-term care coverage that fits your needs and budget.<\/p>\n Based on the standard 4% rule, $2 million could support a comfortable lifestyle for many retirees, depending on spending and market conditions.<\/p>\n The average American household spends about $78,535 per year, according to Bureau of Labor Statistics data. However, that figure includes all age groups and families raising kids and paying mortgages or rent. Averages can also be skewed heavily by outliers, or the wealthiest Americans and their spending habits.<\/p>\n Retired empty nesters typically spend less. In fact, households between the ages of 65 and 74 spend about $65,354 per year \u2014 nearly $13,200 below the average (5).<\/p>\n Applying the 4% rule to $2 million would generate $80,000 in annual withdrawals. That does not account for Social Security benefits or any corporate pension you may have. Simply put, if you want to live a typical life, $2 million may be sufficient.<\/p>\n However, if your lifestyle is more expensive or highly discretionary, it may not be.<\/p>\n Ultimately, you need to ask yourself how much is enough \u2014 and what lifestyle you\u2019re comfortable maintaining.<\/p>\n Even if you\u2019re planning a modest retirement, it\u2019s important to ensure you have enough available cash to maintain a healthy emergency fund.<\/p>\n Conventional wisdom is to keep three to six months\u2019 worth of living expenses in a rainy day fund, but retirees should aim for an 18-to-24-month cushion, reports AARP (6).<\/p>\n After all, you\u2019re no longer earning a paycheck, and older age can bring a higher chance of emergencies \u2014 see the difference between average life expectancy and average healthy life expectancy. Making sure that you have cash on hand to weather life\u2019s storms can be an essential part of your retirement strategy.<\/p>\n A high-yield account like a Wealthfront Cash Account<\/a> can be a great place to grow your uninvested cash, offering both competitive interest rates and easy access to your money when you need it.<\/p>\n A Wealthfront Cash Account currently offers a base APY of 3.30% through program banks, and new clients can get an extra 0.75% boost during their first three months on up to $150,000 for a total variable APY of 4.05%<\/a>.<\/p>\n That\u2019s 10 times the national deposit savings rate, according to the FDIC\u2019s March report (7).<\/p>\n Additionally, Wealthfront is offering new clients who enable direct deposit ($1,000\/mo minimum) to their Cash Account and open and fund a new investment account an additional 0.25% APY increase with no expiration date or balance limit, meaning your APY could be as high as 4.30%<\/a>.<\/p>\n With no minimum balances or account fees, as well as 24\/7 withdrawals and free domestic wire transfers, your funds remain accessible at all times. Plus, you get access to up to $8M FDIC Insurance eligibility through program banks<\/a>.<\/p>\n Opening a certificate of deposit (CD) can be another smart way to grow your emergency fund. CDs allow you to lock in a rate up front so your earnings stay fixed for a set term, even if market rates slip.<\/p>\n If you\u2019re seeking that kind of predictable, reliable growth, a platform like CD Valet<\/a> can help you find high-yield options that work for you in retirement.<\/p>\n Here\u2019s how: CD Valet tracks over 40,000 verified rates from FDIC-insured banks and NCUA-insured credit unions nationwide<\/a> \u2014 and, unlike other websites, they show every publicly available rate, ensuring you have a comprehensive view of the market.<\/p>\n Plus, their CD rates are updated continuously, so you can shop, compare and open CDs with ease<\/a>.<\/p>\n Keep in mind that rising health care costs, in combination with uncertain markets, can make it harder to stretch even a $2 million nest egg to keep you comfortable in retirement.<\/p>\n But by joining a senior-focused organization like AARP<\/a>, you can score discounts on everything from prescriptions and dental plans to travel, entertainment and insurance \u2014 helping keep costs down so you can maintain your retirement lifestyle.<\/p>\n As one of the most trusted organizations for older Americans, AARP not only offers money-saving perks, but they can also help you make informed financial and health decisions.<\/p>\n AARP members get access to guides that can help you make the most of Social Security<\/a>, choose the right Medicare plan and uncover other government benefits \u2014 potentially saving you thousands.<\/p>\n Sign up with AARP today and get 25% off your first year<\/a>.<\/p>\n Americans typically achieve millionaire status in their 50s and 60s, according to Empower (8). If you\u2019re in your 60s with $2 million, actuarial tables suggest you may have roughly two decades of remaining life expectancy on average \u2014 depending on health and gender \u2014 based on conditional life expectancy data rather than the 76.4-year figure measured from birth (9).<\/p>\n To put that in perspective, you would need an annual budget of $125,000 to deplete $2 million within 16 years \u2014 assuming zero investment returns and no additional income sources. In reality, diversified portfolios typically generate returns over time, though they also carry risk.<\/p>\n Simply put, you can enjoy a six-figure lifestyle with a reasonable margin of safety under typical market conditions. For an ordinary couple of empty nesters, that may be more than sufficient \u2014 especially when you account for Social Security benefits.<\/p>\n To be fair, some multimillionaires have a strong desire to leave a legacy. A sizable inheritance could certainly give your loved ones a financial boost.<\/p>\n That\u2019s a perfectly valid goal, but it\u2019s not an obligation. You spent decades earning, saving and sacrificing to build this wealth. If you\u2019d rather spend your money on experiences, travel, comfort and living well in your final chapters, that\u2019s equally valid.<\/p>\n There\u2019s no rule that says your bank account needs to outlive you. The money was always meant to serve your life \u2014 not the other way around.<\/p>\n Whatever your goals for your money, it\u2019s wise to map out a financial plan for your retirement \u2014 including a strategy to grow your $2 million portfolio even more if you do want to leave a sizable inheritance.<\/p>\n A financial advisor can help crunch the numbers and build a plan that works \u2014 but it\u2019s crucial to find a professional you can trust.<\/p>\n That\u2019s where Advisor.com<\/a> can come in. The platform connects you with an expert near you for free.<\/p>\n Advisor.com does the heavy lifting for you, vetting advisors based on track record, client ratios and regulatory background. Plus, their network comprises fiduciaries, who are legally required to act in your best interests.<\/p>\n Just enter a few details about your finances and goals, and Advisor.com\u2019s AI-powered matching tool will connect you with a qualified expert<\/a> best suited for your needs.<\/p>\n Even better, you can schedule a free, no-obligation consultation<\/a> to discuss your retirement goals and long-term financial plan. That way, you can make sure you\u2019re on the same page before looking at what comes next.<\/p>\n With $2 million, you can likely sustain a six-figure lifestyle for many years. While outcomes depend on markets, inflation and longevity, the financial odds are generally favorable at that asset level.<\/p>\n Bottom line: You can keep working after you reach $2 million or more in assets \u2014 but there are compelling financial and personal reasons you may not need to.<\/p>\n Join 250,000+ readers and get Moneywise\u2019s best stories and exclusive interviews first \u2014 clear insights curated and delivered weekly. Subscribe now.<\/a><\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines<\/a>.<\/p>\n Schroders (1<\/a>); World Health Organization (2<\/a>); LongTermCare.gov (3<\/a>); SeniorLiving.org (4<\/a>); U.S. Bureau of Labor Statistics (5<\/a>); AARP (6<\/a>); FDIC (7<\/a>); Empower (8<\/a>); Social Security Administration (9<\/a>)<\/p>\n This article provides information only and should not be construed as advice. It is provided without warranty of any kind.<\/p>\n","protected":false},"excerpt":{"rendered":"Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below. 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