'$2 Million Is Nothing' Suze Orman Warns Don't Retire If You Don't Have At Least $5 Million Or $10 Million Saved

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'$2 Million Is Nothing' Suze Orman Warns Don't Retire If You Don't Have At Least $5 Million Or $10 Million Saved On the "Afford Anything" podcast, Suze Orman delivered a pointed critique on the notion of retiring early with a $2 million portfolio. She was direct in her advice, emphasizing the insufficiency of such an amount for early retirement. "Two million dollars is nothing," Orman declared, "It’s nothing. It’s pennies in today’s world, to tell you the truth." Don't Miss: The average American couple has saved this much money for retirement — How do you compare ? Can you guess how many Americans successfully retire with $1,000,000 saved? The percentage may shock you. Orman expanded on the potential financial dangers that could deplete such savings quickly. "If you have $20 [million], $40 [million], $50 [million] or $100 million, be like me, okay. If you have that kind of money … and you want to retire, fine," she explained, contrasting this with the risks faced by those with less substantial sums. "But if you only have a few hundred thousand dollars, or a million, or $2 million, I’m here to tell you...if a catastrophe happens...what are you going to do? You are going to burn up alive." Addressing the common retirement strategy of withdrawing 4% annually, Orman was skeptical: "I think that in the long run, $80,000, especially after taxes and as you get older, is not going to be enough. You may think it’s going to be enough, but it’s just not," she stated firmly. Her advice underscores the importance of ample financial cushioning, particularly if unexpected costs arise, such as health care or family support needs. "Think about it logically," Orman urged, highlighting potential expenses that could easily top hundreds of thousands annually. Trending: Reddit user reveals his retirement account’s “hourly wage” — how much does your money really make per hour? When asked if $3 million was enough Orman firmly stated it was not. "If you don’t have at least $5 million or $10 million, don’t retire early," Suze asserted. Orman’s assertion that individuals need "at least $5 million to retire early" stirred a mix of reactions, with some viewing it as excessively cautious while others validate her perspective. Financial Samurai supports Orman’s viewpoint, highlighting that with today’s low interest rates, a larger capital is necessary to generate sufficient risk-adjusted income for early retirement. This is particularly relevant considering the need to depend more on investment income due to the diminishing reliability of traditional retirement income sources like Social Security and pensions. Story continues While Orman faced significant backlash for her statements, with critics arguing that her figures are unattainable for most, the underlying principle she advocates is prudence. This idea resonates with a segment of the financial community that sees the wisdom in ensuring a substantial financial buffer to address uncertainties in retirement, especially given potential long-term trends such as increasing health care costs and ongoing economic fluctuations. Orman's conservative approach, advocating for a higher threshold of retirement savings, reflects a cautious strategy designed to safeguard against the unknowns of future decades. Financial planning is crucial for a secure retirement, and while Suze Orman’s recommendations may not be suitable for everyone, consulting a financial advisor can help you craft a personalized plan that aligns with your unique goals and risk tolerance. An advisor can help you assess your current financial situation, including your income, expenses, debts, and savings, and create a road map to reach your retirement goals. Read Next: Boomers and Gen Z agree they need a salary of around $125,000 a year to be happy, but millennials say they need how much? Are you secretly doing better with your money than you think? Here are some signs you’re financially healthy. "ACTIVE INVESTORS' SECRET WEAPON" Supercharge Your Stock Market Game with the #1 "news & everything else" trading tool: Benzinga Pro - Click here to start Your 14-Day Trial Now! Get the latest stock analysis from Benzinga? This article '$2 Million Is Nothing' Suze Orman Warns Don't Retire If You Don't Have At Least $5 Million Or $10 Million Saved originally appeared on Benzinga.com © 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.