We know our reader demographics fairly well and unless there might be a huge chunk of you who have retired early we’d say most of those who read (and write) these posts are quite some time from taking a permanent vacation.  At least by American standards which are now reaching closer to not beginning until age 67 and certainly even later for those with birth dates from the 1990’s.

Not so long ago on one of the television financial “news” programs, the hostess repeated her oft told opinion that if one plans on a happy and successful retirement, he or she must have at least a million dollars in a retirement account.  Even though we aren’t close to retirement we also aren’t close to having a million dollars in any account, particularly not one that will be left untouched for quite a few years yet to come.  Had we a million dollars in all of our combined accounts we’d probably die of shock and never get around to the retirement anyway.

Where, we would like to know, with houses costing hundreds of thousands of dollars, cars costing tens of thousands of dollars, and bacon costing $4.00 a pound, does one manage to cut back sufficiently to save a million dollars.  We suppose if we were a television host and hostess and making six or seven million dollars a year, we could easily scrape up a million in 40 years of working.  We might even save a few bucks from the radio shows, books, syndicated newspaper columns, and commercial endorsements.  We might be able to save a million dollars for every year of retirement.  Maybe for every day!  But we aren’t.  And we suspect if you are reading this (please, we mean not to pry) you probably aren’t saving at that rate either.

As we said, we aren’t close to retirement ourselves but we know many people who have retired.  Some at the traditional retirement age, some a little earlier, some a little later.  The one thing they all had in common is that they didn’t have a million dollars saved and yet they have managed to live happy and successful retirement lives.  How does one do it living in such abject poverty that comes with having less than a million?  Let’s start with having the big things paid for before hitting retirement.  The mortgages are gone.  New car warranties of 10 years or 100,000 miles are used in entirety.  Clothes last for more than one season.  Dinners out are held to no more than once a week, sometimes even less.  Vacations are instead long weekends.  Credit cards are for true emergencies.  Better still, hard won savings are for true emergencies.  Frugal is not a bad word.  It can be done.

Will anybody ever really need a million dollars to retire?  Probably to the financial pundits who in their working lives are making six or seven million dollars a year, a million seems to be the bare minimum.  Thank goodness they’ll still be eligible for social security.

Now, that’s what we think. Really. How ‘bout you?