Reaching a savings milestone of $5 million by age 50 is a significant achievement, allowing for potential early retirement options. This amount generally allows for a comfortable withdrawal of about $200,000 per year under the 4% safe withdrawal rate, making it feasible for sustaining a satisfactory lifestyle. Individuals with this level of savings can consider stopping their contributions to retirement accounts and might look into less stressful employment options, knowing that their investments can grow without additional input, reflecting a strategy similar to Coast FIRE.
If you have $5 million at age 50, you can consider retiring and may not need to continue contributing to your 401(k) anymore.
Reaching a $5 million savings goal means you could potentially live off a $200,000 annual withdrawal and enjoy retirement.
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