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Can You Live Off $1 Million Dollars? (and for How Long?)

Tons of people work all their lives to save up 1 million dollars. And then they have absolutely no clue if they can live off 1 million dollars or how to do it!

Some spend too little, others spend too much. Some invest too conservatively, others invest with way too much risk. 

Wondering if you can live off 1 million dollars? Or maybe you’re wondering how you can live off 1 million dollars? This post should have the answers to all your questions! And, for good measure, we’ll try to answer all your related questions as well.

 Questions like…

  • How much interest does 1 million dollars earn per month? Per year?
  • How common is it to have a million dollars? Are you better off than most?
  • Is 1 million dollars enough for a couple to retire?
  • Can you live comfortably on a million dollars?

If you want to learn how to live on 1 million dollars (and everything else that’s closely related), you found the right post!

If you like this article, check out the interest earnings within the posts listed below:

And take a serious look at our Best Investment Apps piece if you’re looking to invest.

Can You Live Off 1 Million Dollars?

It’s possible to live off a 1 million dollar retirement nest egg as long as you use $50,000 per year to cover your basic living expenses.

Assuming you withdraw $50,000 per year, your $1 million can last for 20 years. However, if you add an average inflation rate of 2%–4% each year, your $1 million can last for around 15 years. This amount of money may not be enough for a comfortable retirement.

A recent survey by Schwab Retirement Plan Services revealed that the average American needs about $1.9 million to retire comfortably.

(Interested in investing now? Here’s our list of the best stock apps and the best investment apps.)

What Percentage of Retirees Have a Million Dollars?

Before we dive too deeply into the numbers, it would be helpful to know how many people have $1,000,000 in savings today! Because most are getting along just fine.

Do they have a million dollars? Or are they living on even less than that? 

So what is it? What percentage of retirees have a million dollars?

According to a survey by TD Ameritrade, on average, 12% of retirees have $1 million dollars or more in their retirement savings (see the chart below). So if you have (or will have) a million dollars in retirement, you’ll certainly be better than average! What Percentage of Retirees Have a Million Dollars In Their Retirement? Now the question is, what does a million dollars get you? Will you be able to retire the way you want to?

How Much Interest Does 1 Million Dollars Earn Per Year?

Let’s say you did it. You saved up that million bucks! Now what? How much interest does 1 million dollars earn per year?  Well…as you may have guessed…it all depends on the interest of your investment!

Based on my research and my experience, you can expect to get the below rates for the respective investments.

  • Savings: 0.5%
  • Certificate of Deposit: 0.65%
  • Short term government bond: 1%
  • Short term corporate bond: 2-3%
  • Annuity: 3%
  • Real Estate: 7%
  • S&P 500 Index Fund: 10%

The real estate percentage is my estimate based on the crazy price of homes today (rental rates have not kept up with housing prices). And, the S&P 500 is based on the historical average when including dividend reinvestment. 

So now to answer the question of “what is the interest on 1 million dollars annually?” 

  • With a 0.5% savings account: $5,000 a year
  • 1% government bond: $10,000 a year
  • 3% annuity: $30,000 a year
  • 7% real estate: $70,000 a year
  • And, 10% in S&P 500: $100,000 per year

Based on those numbers, it seems like a no-brainer for what you should invest in, right? Not so fast. There’s also the factor of risk. Putting your million dollars in the stock market is much more risky than putting it into a savings account. Be sure to take that into account and invest accordingly.

(Interested in investing so you can become a billionaire? Here’s our list of the best stock apps and the best investment apps to get you started.)

How Much Interest Does $1 Million Dollars Earn Per Month?

If you did have that sack of cash, then what would be the monthly interest on $1 million dollars? Using the same investment figures as above, here’s how much you’d earn each month on one million dollars:

  • 0.5% savings account: $417 a month
  • 1% government bond: $833 a month
  • 3% annuity: $2,500 a month
  • 7% real estate: $5,833 a month
  • And, 10% in S&P 500: $8,333 per month

Is a Million Dollars Enough For a Couple to Retire?

I’ve heard this question a lot lately — “Can a couple retire on $1 million dollars?” It’s a fair question. Sure, $1 million seems like a solid number for one person, but when you put two people into the mix, you’ve got…

  • additional food costs every day
  • extra clothing costs
  • the cost of a second car

And, quite frankly, more unexpected bills can come up when you’ve got two people in the equation vs. just one. 

The Best Way to Know If a Couple Can Retire on 1 Million Dollars

If you really are uncertain about this one, I suggest you just take this simple approach. 

  1. Ask yourself what amount of money you live comfortably on today
  2. Would you like this annual amount in retirement as well?
  3. If so, enter that amount in Bankrate’s handy Savings Withdrawal Calculator to see how long your money will last in retirement

By entering in your likely nest egg (the million bucks), the interest you’d earn on that money (I’d estimate 6% to be safe), and the withdrawal rate each year, you’ll quickly be able to see if your money will last…even as a couple. Is a Million Dollars Enough for a Couple to Retire On? In the example above, I used a yearly withdrawal rate of $50,000, which many couples could live on today. And you know what? That million dollar nest egg kept going up! Can a couple retire on $1 million dollars today? Absolutely! Just as long as they live on $50k a year.

Do Couples Need 2 Million to Retire?

The only problem with $50k a year is…after roughly 20 years in retirement, that money is going to feel like just $25k a year (thanks to inflation). 

So if you intend to live for 20+ years in retirement, can you live comfortably on a million dollars? Mmmm….you may want a little more. This leaves many couples wondering if they should reset their goals and instead save up 2 million dollars in retirement!

How much could you withdraw each year if you had $2 million in retirement?

If $50,000 a year seems like too little to you (because inflation is essentially cutting it in half), you might be looking at withdrawing an amount that’s closer to $100,000 a year.

But you know what? If you have $2 million in retirement and withdraw $100,000 a year, your nest egg will just keep growing for decades!

Check out the chart below. Can a Couple Retire Comfortably With $2 Million Dollars? So, can you live comfortably on a million dollars? It’s possible to live…but you’ll certainly have to watch your pennies. We’ll go over this in more detail later.

Can you live comfortably on 2 million dollars? Yes. It might even be a bit of overkill.

If you don’t want to live on only a million bucks in retirement, but you don’t want to wait to retire until you hit the $2 million mark, then $1.5 million might be the right number for you!

Related: What is the Interest on 2 Million Dollars?

Can You Retire Comfortably on 1.5 Million Dollars?

Is $1.5 million dollars the right number for retirement? Let’s stick with our $100,000 withdrawal each year.

How long would $1.5 million last in retirement? Is $1.5 Million Enough For Retirement? Turns out, even by withdrawing $100,000 a year out of your nest egg each year, it would last over 30 years! If a million dollars in retirement didn’t seem like enough, but you didn’t want to wait until you reached $2 million, then $1.5 million might be the perfect number for you!

How to Live on 1 Million Dollars (Can It Last Till You Die?)

We discovered early on in this post that only 12% of retirees had a million dollars in retirement. So it is definitely possible to live on less than that. I mean c’mon! 88% of the population is already doing it! 

Here’s how you can live off the interest of 1 million dollars:

  • Set up your investments to earn 6% per year
  • If you withdraw $50,000 a year, your nest egg will continue to grow and last forever
  • Withdraw $60,000 a year and your million dollars will still be worth $378k after 50 years of withdrawals
  • Withdraw $70,000 a year and your money will run out after 29 years
  • And, if you withdraw $75,000 a year, you’ll be out of money in 24 years

Withdraw any more than $75k a year and you’ll be at risk for running out of money before you die (never a good scenario!!). 

Can You Retire Early With 1 Million Dollars?

Now, let’s say you don’t want to retire at the conventional age of 65 or 67 years old. You want to retire earlier!

Is it possible to retire early with 1 million dollars?

It is, but you won’t be living lavishly in retirement!

Want to retire at 40 years old? Or maybe 45? 50? 55? Check out all the sections below to see how much you could withdrawal each year from your million dollar nest egg, but still have some money left over when you die.

And don’t forget these important points:

  1. Inflation is a killer. It will cut your purchasing power in half every 20 years.
  2. If you retire before the age of 65, you’ll need to buy your own medical insurance. Don’t forget to factor this into your cost of living!

Can I Retire at 40 With $1 Million Dollars?

Want to know how to live on 1 million dollars if you retire at 40 years old?

To make a million dollars last for 60 years (who knows? You might live until you’re 100 years old!), you’ll have to be quite careful with your withdrawal rate.

If you can earn 6% on your money in retirement, you could consistently withdraw $59,700 a year and still have $25,000 to your name at your 100th birthday party.

So, can you retire at 40 with 1 million dollars?  Yup! Buuuuut, your withdrawal of $59k a year is going to feel more like $15k after 40 years of retirement… That’s going to be rough. 

(Interested in a monthly budget template? Follow the link for a comprehensive spreadsheet that will auto matically create your budget for you. All you need to do is enter your income and it does the rest.)

How to Live Off 1 Million Dollars If You Retire at 40 Years Old

If it were me and I had $1 million in retirement by 40, I would probably start off super frugal and allow my money to grow for a decade or two.

I figure it’s easier (and more fun) to live frugally when I’m young than when I’m elderly and have a bunch of medical costs to deal with. 

Related: Early Retirement – Is It Really Possible?

So how can you live well on 1 million dollars if you retire early?

Here’s what I would do:

  • Keep the earnings target at 6% per year
  • Only withdraw $40k a year for the first 20 years (this allows the 1 million dollar nest egg to grow to $1.7 million)
  • Then start withdrawing $90k a year for the next 20 years (feels like $45k due to inflation)
  • Then bump up the withdrawals to $165k for the last 20 years (feels like $41k due to inflation)

In the 60th year (your 100th birthday), you’ll still have $59,000 to your name!

Related: Can a Poor Person Become a Millionaire (and if so…how?)?

Can I Retire at 45 With $1 Million Dollars?

Maybe you’re approaching your 45th birthday and you just reached the ultimate pinnacle of 1 million dollars in your retirement account. Good for you! Now, it’s leading you to the question…”Can I retire at 45 with $1 million dollars?”

The short answer:  Sure you can!

Do you still need to be cautious with your spending?


How to Live Off 1 Million Dollars If You Retire at 45 Years Old

If you want to retire at 45 years old with 1 million dollars, you can be slightly more aggressive than if you were 40…but not by much. First, be sure you’re earning 6% on your money.

Then, instead of withdrawing a flat $59,700 a year, you could dial it up to $60,300 and still have a bit left by the time you reached 100 years old.

Can I Retire With $1 Million Dollars at 50?

Want to retire at 50 with 1 million dollars? You can. It’s certainly possible. And, you can afford to be even more aggressive since you only need your money to last for 50 years vs. 55 or 60 years.

How to Live Off 1 Million Dollars If You Retire at 50 Years Old

So how can you do it? How much can you withdrawal a year if you retire at 50 with 1 million dollars? If you earn 6% on your money each year, you can withdraw $61,100 a year and be left with $20,000 at the end!

Can I Retire With $1 Million Dollars at 55?

So how about at age 55? Can you retire with 1 million dollars at 55 years old? We just showed you how to retire with 1 million at age 40, 45, and 50, so of course you can retire at 55 years old! But, oddly enough, you’ll still have to be quite cautious with your spending.

A million bucks just isn’t what it used to be!

How to Live Off 1 Million Dollars If You Retire at 55 Years Old

So how can you do it? How can you live off 1 million dollars if you retire at 55 years old? If you earn 6% on your money, you can withdraw $62,200 a year and still have $26k left when you turn 100.

Again though, keep in mind that at the 40 year mark, your purchasing power will be roughly 1/4th the amount of today (thanks to inflation). So $60k in 40 years will only buy you as much as $15k will today. 

Want to live better in your later years? Spend less today and then increase your withdraw rates with inflation. (Here’s a link to our budget spreadsheet again if you’re interested in playing with some numbers.)

Here’s how I’d recommend you live off 1 million dollars if you retire at 55 years old

  • Earn your 6% rate each year with your money
  • In the first 20 years, withdraw just $40,000 a year. This would allow your retirement to grow to $1.7 million.
  • In the next 25 years, you could live large and withdraw $120,000 (which would feel like $60k in today’s dollars).
  • And then, you’d still be left with $430,000 when you turn 100!

So can you live off the interest of a million dollars? Heck yes! I’d say you now have a few options of how to do so! 

How to Live on 1 Million Dollars – Is This Plan Right For You?

You came here wanting to understand how to live on 1 million dollars. The answer is pretty simple.

  • Invest so that you earn a consistent 6% on your money (which is probably a combination of stock market investing, real estate, and perhaps some annuities – it’s certainly not rocket science to earn 6%).
  • Then withdraw roughly $60,000 a year.
  • And your money will last till you die!

If you want to get a little bit more fancy, you can start by withdrawing just $40,000 a year, and then ladder up from there along with inflation. The point is, it’s definitely possible to live off of 1 million dollars (even if you retire early).



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