Is $1.5 Million Enough to Retire at Age 60?
Retiring at 60 sounds amazing, doesn’t it? No more meetings, no more deadlines—just travel, hobbies, and more time for the things (and people) you love. But is $1.5 million enough to make it happen? Let’s dive into the details, look at different scenarios, and run the numbers using real-life strategies. Buckle up—retirement planning just got fun.
Retirement at 60: What Does That Actually Mean?
Retiring at 60 means you're likely leaving the workforce five to seven years before you’re eligible for full government benefits like Social Security or CPP. That gap has to be funded entirely from your savings, investments, or other income sources.
It also means funding a retirement that could last 30+ years. According to the U.S. Social Security Administration, a man who is 60 today has a 50% chance of living to 84, while a woman has a 50% chance of hitting 87. That’s a long time to stretch $1.5 million.
The 4% Rule: What Does It Say About $1.5 Million?
The famous 4% rule suggests you can safely withdraw 4% of your retirement portfolio annually, adjusted for inflation, without running out of money. Based on that:
4% of $1.5 million = $60,000/year
This means you could withdraw about $5,000/month. Is that enough? It depends on your spending, taxes, healthcare costs, and location.
But Wait—You're Retiring Early!
Because you’re retiring before age 65 (in Canada) or 67 (in the U.S.), many advisors recommend using a lower rate—like 3.5%—to account for longer time horizons and market risks. That would reduce your safe withdrawal to about $52,500 per year.
Use the Retirementize Income vs. Savings Calculator to test different withdrawal rates based on your situation.
Key Factors That Impact Whether $1.5M Is Enough
Lifestyle and Spending Habits
If you’re living large with international travel, two homes, and supporting adult children, $1.5 million will evaporate faster than an ice cube in July. But if you embrace frugal retirement living—think modest home, used car, and local adventures—you could do just fine.
Location, Location, Location
Where you live dramatically affects your budget. Retiring in Florida? Watch out for hurricane insurance premiums. Thinking about small-town Alberta? Lower cost of living, but fewer amenities. Considering Mexico or Portugal? You’re not alone—retiring abroad is trending.
Healthcare Costs
One of the biggest curveballs. If you’re American, you won’t qualify for Medicare until 65. Private insurance can run $1,000–$1,500/month for a couple. Canadians fare better, but drugs, dental, and extended care still add up.
Longevity
What if you live to 100? That’s 40 years of retirement. You need to plan for the “worst-case-best-case” scenario: living long and healthy. Use Retirementize’s withdrawal calculator to run long-term simulations.
Inflation
Inflation is a retirement killer. A fixed income of $60,000 won’t feel like much in 2045. Even modest inflation (2.5%) will cut your purchasing power in half over 28 years.
Other Retirement Income Sources
- CPP/OAS (Canada): Most Canadians qualify for some level of Canada Pension Plan and Old Age Security. Check out why delaying CPP might pay off.
- Social Security (U.S.): The longer you wait to take it (up to age 70), the bigger the monthly check. See how Social Security works.
- Rental Income: Learn how rental properties can fund retirement.
- Pensions: Lucky enough to have one? Factor it into your planning here.
- Part-Time Work: There’s no shame in working a little. Explore best retirement side gigs.
Real-Life Scenarios
Scenario 1: The Frugal Couple
Jack and Marla, 60, live in a paid-off bungalow in New Brunswick. They spend $42,000/year, love hiking, and travel domestically. With $1.5M and modest CPP, they’re golden.
Scenario 2: The Middle-of-the-Road Retirees
Ahmed and Sheila want a nice condo, annual international travel, and occasional help to their adult kids. Their spending hits $75,000/year. They’ll need to supplement that $60K from investments.
Scenario 3: Big Spenders
Leo and Joanne have a lavish lifestyle and a downtown Toronto condo. Their burn rate? $120K/year. Unless they downsize or find extra income, they’ll run dry fast.
Pros and Cons of Retiring at 60 with $1.5M
Pros
- Younger, healthier, more energy to enjoy life
- Time to pursue passions, hobbies, travel
- Opportunity to control your schedule and reduce stress
Cons
- No access to government benefits yet
- Potential healthcare coverage gap
- Longer timeline increases risk of running out of money
Tips to Make $1.5 Million Last
- Delay CPP/Social Security for higher monthly payouts
- Use the Retirementize calculator to stress-test your plan
- Downsize your home or relocate to a cheaper region
- Pick up part-time work doing something fun
- Embrace a frugal but fulfilling lifestyle
- Avoid common retirement mistakes
Fun Facts
- One in four 65-year-olds today will live past age 90.
- The average Canadian spends over $7,000/year on healthcare after 65.
- Inflation averaged 3.4% in 2022–2023—double the 10-year average.
- 57% of Americans have less than $1,000,000 saved for retirement.
- Early retirees are 33% more likely to travel internationally each year.
Conclusion
So—is $1.5 million enough to retire at age 60? For many, yes. For some, not quite. It depends on your lifestyle, location, health, and flexibility. If you're strategic and realistic, it’s absolutely doable. Use the Retirementize online income calculator to map out your numbers and explore every scenario with clarity and confidence.