Money that Lasts: Can a $1 Million Nest Egg Work for Life?

A big sum at the start of retirement is only part of the story. What matters most is how much you pull from it each year.

• 3 % Withdrawal
• A $1 million pot can survive more than five decades.
• 5 % Withdrawal
• The risk of outliving it rises sharply.

Why Early Retirees Face a Tougher Test

Early retirees must watch their money for 50 years or more. Inflation and market swings have plenty of time to erode the balance, especially when a dip occurs early. A withdrawal in the second year locks in losses that are harder to recover.

Flexibility Is Key

• Cut expenses during bad years.
• Move to cheaper living areas when possible.
• Pick up side gigs to boost income.

How much you spend and how well you adapt to downturns often outweigh the exact amount saved.

Small Extra Spending Adds Up

An additional $5 000 each year can add up to a missing six‑figure sum over time. So the question isn’t just whether $1 million is enough, but whether your lifestyle lets it stretch.

Targeting a Lower Withdrawal Rate

Early retirees often aim for a lower withdrawal rate than the classic 4 % rule:

• Target between 2.5 % and 3.5 %
• Gives the portfolio more breathing room.
• Allows recovery from market setbacks and keeps pace with inflation.

Bottom Line

The longevity of a $1 million retirement depends on spending habits and adaptability rather than luck or stock picks. By living below the drawdown threshold and staying flexible, you can keep that money working for many decades.