$1.5m Is a Retirement 'Magic Number.' Here's How Long It Lasts In Every State.
When it comes to planning for retirement, one number keeps coming up again and again: the retirement magic number.
It’s that target amount we hope will carry us comfortably through our golden years, covering everything from groceries to healthcare to the occasional beachfront margarita.
But, is $1.5 million enough? Well, that depends a lot on where you live. Let’s break it all down.
$1.5m Is a Retirement 'Magic Number.' Here's How Long It Lasts In Every State.
So, what’s a realistic retirement number? That depends on who you ask.
Charles Schwab puts the number at a whopping $1.8 million.
Schroders comes in on the lower end at $1.2 million.
Northwestern Mutual falls in the middle at $1.5 million.
That number is also the figure used in a recent GOBankingRates report to explore how that sort of savings will hold up in every U.S. state.
And here’s the silver lining: $1.5 million goes a lot further in some states than in others.
Where Are Retirees Actually Moving?
Before we dig into the numbers, let’s talk about where people are choosing to spend their retirement years.
A recent AARP report found that the best states for people to retire to in 2024 were:
Massachusetts
Florida
Illinois
Kentucky
North Carolina
Some classic retirement destinations, like Arizona, didn’t even crack the top 10. Surprising, right?
How Long Does $1.5 Million Last in Popular Retirement States?
Let’s take a look at how far that number really stretches in those top five destinations:
Massachusetts: 23 years
Florida: 39 years
Illinois: 44 years
Kentucky: 46 years
North Carolina: 42 years
That’s a pretty big range, even among popular retirement picks. Massachusetts, for example, is one of the most expensive states, with an annual cost of living after Social Security of over $65,000. Meanwhile, in Kentucky, that same $1.5 million could last nearly twice as long.
Want Your Money to Stretch Even Further? Consider These States
If affordability is your top priority, here are five budget-friendly states:
West Virginia: 54 years
Kansas: 52 years
Mississippi: 51 years
Oklahoma: 51 years
Alabama: 50 years
Yes, you read that right – your nest egg could potentially carry you through half a century of retirement in some of these places. And, considering the average American retires around age 65 and lives another 20 to 25 years, that’s more than enough cushion for most people.
In fact, according to GOBankingRates, $1.5 million may stretch as far as 40 years in 32 different states. That’s some solid peace of mind.
Let’s Be Honest – Most of Us Don’t Have $1.5 Million Saved
Here’s the tough truth: most people retire with far less. The Federal Reserve’s Survey of Consumer Finances reports that the typical American household aged 65 to 74 has about $200,000 in retirement savings. And only around half of those households even have retirement accounts to begin with.
That said, many retirees still manage to get by just fine on Social Security and a more modest nest egg. The idea behind the realistic retirement number is to balance savings with lifestyle expectations and the cost of living.
It's Not One-Size-Fits-All
Sure, $1.5 million might not be enough if you’re planning to retire in Hawaii, where it would only last 17 years, or in California, where it stretches to about 24 years. But, throughout most of the U.S., that sum of money is still very solid.
Try using tools like a simple retirement calculator or a full-featured retirement calculator come in handy. They help you factor in everything from Social Security benefits to healthcare costs, and even local housing prices.
The Bottom Line
Is $1.5 million enough to retire? For many Americans, the answer is yes, especially if you choose a retirement-friendly state where your savings can stretch further. Of course, your own retirement plan should reflect your lifestyle goals, health needs, and where you plan to live.
Whether you’re aiming for a beachfront bungalow or a cozy mountain cabin, the key is understanding what your retirement magic number is – and planning accordingly.
And, truth be told, if you're not quite at $1.5 million yet, don't panic. Retirement isn't about hitting one magic number. It's about knowing your options, setting goals, and making smart choices along the way.