A Million Dollars Isn’t What it Used to Be
One Million Dollars.
It sounds big. Big enough to have all of your worries go away in an instant. The sad truth is, it is not as big a number as it sounds. Not anymore at least, and certainly not in New Jersey.
My fiancé and I sat down a few evenings ago and did the math to see what it would take to walk away from our jobs and live in perpetuity off our investments. We made sure to add in the cost of independant health insurance as well as a comfortable level of spending for us both. After all, without work, we would have more time to ourselves and would need to be adequately entertained.
Without work, there are several expenses that go down or go away all together. For instance, we would be able to sell one of our cars and drastically reduce our spending on gas. And we all know what gas costs these days.
We also made our calculations based on staying in New Jersey, where the cost of living is rather high. If we moved to a lower cost of living state, we would be able to stretch our dollars further. However, we would want to remain somewhat close to our families and friends. We have spent the better part of our years here and would not feel right walking away from all of our emotional ties.
Some expenses would go up, such as the cost for heating and air conditioning and electricity. Since we would be home more during the day, we would be using all of these more.
The end result? We would need a bit over 2.3 Million dollars. And that would be today. For every year we don’t have that final amount, we would have to adjust up for another year of inflation.
While a million dollars is a significant emotional milestone, it is hardly the panacea it used to be. If I went to Vegas tomorrow and won a million dollars from a slot machine, I would be happy, but I would not be able to shed my day job just yet.
That said, it is a worthwhile goal to hit. I often joke that my taxable stock trading account has a goal of one million. I hope to actually hit that number in the future. I’ll make it so long as I don’t actually give up. While a million isn’t what it used to be, it still feels good saying it and it will feel good having it too.