Wealth Matters: How Much Is Enough?
“Yes, but I have something he will never have—enough!” ~ Joseph Heller, Author of Catch-22
We’ve all seen the commercials asking, “What’s your freedom number?” It’s a fair question. Many near-retirees haven’t taken the leap because they haven’t been able to answer that one basic riddle: How much is enough?
The standard internet shortcut is 25 times your annual retirement expenses. It matches up with the famous 4% rule, which says you can safely spend 4% of your liquid assets a year, forever.
But rules of thumb are just starting points, not promises. They ignore the real-life variables:
Social Security income
Mortgage payoffs
Healthcare costs prior to age 65
Gifting to heirs or receiving an inheritance
Suddenly, the simple formula falls short. And look at the stakes: if you over-spend, you run the risk of running out of money. But if you under-spend out of fear, you guarantee you'll leave too much life on the table. Both are failures.
I’ve worked with clients who actually added to their investments each month in retirement because they didn’t even spend their entire Social Security check. And I’ve worked with clients who needed extra cash every month on top of an $80,000 quarterly distribution. (Maybe I should set up a lunch for those two to meet.)
So how do we actually find your version of enough? We break the complexity down into four simple questions:
How much does your life really cost? Not the theoretical budget. The real one. What changes when you don't commute, but have 40 extra hours a week for travel and hobbies?
What will reliably show up every month? Your baseline retirement paycheck—Social Security, pensions, or rental income. The closer this is to covering your essentials, the less pressure you put on your portfolio.
What can your portfolio safely support? We look at the actual size of your assets, how they are invested, and your flexibility to dial spending up or down if the markets get rough.
What could go wrong? We stress-test the plan against the wildcards—bear markets early in retirement, health events, or needing long-term care.
If your plan can take those hits and you still recognize your lifestyle, you are much closer to "enough" than you think. In fact, you might already be independently wealthy and just working out of habit and uncertainty, not necessity.
A good financial plan doesn’t just chase a bigger number; it tells you when you can stop chasing and start living.
If you’d like to begin sorting out what your number is, let me know. Knowing what’s “enough” for you—and having the confidence to act on it—is exactly why your wealth matters.
