People Say $10 Million Is Enough to Retire Early, but I Strongly Disagree

Is a $10 million net worth the right target for retirement? A post in the Fat FIRE subreddit generated significant engagement around exactly that question. The Redditor references a Financial Samurai blog post by Sam Dogen, who argues that $10 million is the ideal net worth for retirement.

That figure sounds enormous to most Americans, and yet the Fat FIRE community debates it regularly. Whether it is sufficient depends almost entirely on personal circumstances: where you live, how long your retirement needs to last, and what lifestyle you intend to fund. Consulting a financial advisor before drawing any firm conclusions for yourself is a wise first step.

Location and Lifestyle Matter

Geography shapes retirement math more than almost any other factor. Sam Dogen, who founded Financial Samurai in 2009 and retired from investment banking at age 34, lives in San Francisco, one of the most expensive cities in the world. That context explains why his retirement target sits considerably higher than what most households would need. He estimates that $10 million invested in income-producing assets can generate roughly $350,000 to $500,000 per year in low-risk income, a range that makes practical sense for a high-cost coastal city but far exceeds what the average retiree requires.

For someone in a low-cost rural area, the picture looks entirely different. Retiring on $1 million or $2 million is genuinely achievable in the right location, particularly for someone at traditional retirement age who does not need the portfolio to last four or five decades. For those pursuing a high-end lifestyle, however, spending on luxury goods and private healthcare tends to grow faster than general inflation. That dynamic is part of why some in the Fat FIRE community contend that $10 million is effectively the new $5 million.

Continuing to Work After a $10 Million Net Worth

Crossing the $10 million threshold does not automatically translate into retirement. Many people continue working well past that point, a pattern sometimes called “One More Year Syndrome.” The psychological pull to keep earning is rarely about the math. It tends to be rooted in a fear of losing a professional identity, or in the comfort of a predictable paycheck, rather than any genuine financial need.

The Redditor whose post sparked this discussion holds a net worth of $12 million: $10 million in stocks and ETFs and $2 million in home equity. Despite sitting well above any conventional retirement threshold, this person has stayed in the workforce because the job is low-stress and provides steady income. That choice illustrates how personal fulfillment and financial inertia can easily override a purely numerical case for retiring.

Dogen himself is an instructive example of this tension. Although he left Wall Street in 2012, he continued building Financial Samurai into one of the leading independently owned personal finance sites in the country. In 2025 he published a USA TODAY national bestseller, “Millionaire Milestones: Simple Steps to Seven Figures,” reinforcing that for many high-net-worth individuals the goal shifts from accumulating wealth to finding meaningful ways to deploy time and energy. Reaching the number, it turns out, is often easier than deciding what to do afterward.

How Much Do You Need at Retirement?

The most practical starting point is calculating monthly expenses and then applying a safe withdrawal rate to determine a required portfolio size. The longstanding “4% rule,” developed by researcher Bill Bengen in a 1994 paper in the Journal of Financial Planning, holds that a retiree can withdraw 4% of their portfolio in year one, adjust for inflation annually, and expect the money to last 30 years. That benchmark remains the most widely cited baseline, but it has attracted scrutiny from two different directions in recent years.

Bengen himself updated his own thinking in his 2025 book, “A Richer Retirement: Supercharging the 4% Rule to Spend More and Enjoy More,” raising his recommended first-year withdrawal rate to 4.7%. His revised analysis swaps the original 50/50 stock-and-bond portfolio for a more diversified seven-asset-class mix (roughly 55% stocks, 40% bonds, and 5% cash), and he argues that retirees who stick with 4% are “cheating themselves a little bit.” Morningstar, working from a forward-looking view of capital markets, arrives at a more cautious figure. Its State of Retirement Income report, released in December 2025, pegs the safe starting rate at 3.9% for those retiring in 2026, up from 3.7% in the prior year’s report. The honest conclusion is that no single number fits every situation.

Using the classic 4% figure as a planning anchor, someone spending $10,000 per month carries $120,000 in annual expenses, which implies a required portfolio of $3 million. Those who want additional cushion can apply a 3% withdrawal rate instead, pushing the required nest egg to $4 million for that same level of annual spending. Neither figure is anywhere near $10 million for a household with typical expenses. That gap illustrates just how location- and lifestyle-specific any retirement number really is. High-net-worth individuals sometimes pursue a “Yield Shield” approach, building a portfolio heavy in dividend-growth stocks so that living expenses are covered by income alone, without drawing down principal.

The SECURE 2.0 Act has also given large tax-deferred portfolios more room to grow. Required Minimum Distributions (RMDs) now begin at age 73 for those born between 1951 and 1959, up from age 72 under the original SECURE Act. Those born in 1960 or later will not face mandatory withdrawals until age 75, when that rule takes effect on January 1, 2033. That extended tax-deferral window lets a large portfolio compound longer before mandatory withdrawals kick in, which is a meaningful advantage for early retirees who stop working in their 40s or 50s.

Age at retirement matters enormously in this calculation. Someone in their 60s needs a smaller cushion because the portfolio has fewer decades to outlast. Someone aiming to retire in their 30s or 40s faces a horizon of 50 years or longer, where compounding inflation and rising healthcare costs weigh far more heavily. For that group, a higher portfolio target is a practical necessity, not an indulgence.

The bottom line is that $10 million comfortably covers retirement for most people in most scenarios, but it functions as neither a universal floor nor a universal ceiling. Personal expenses, location, age, and risk tolerance all matter far more than any single target number.

Editor’s note: This pass adds the December 3, 2025 release date for Morningstar’s State of Retirement Income report and clarifies Bengen’s updated seven-asset-class portfolio composition (55% stocks, 40% bonds, 5% cash) from his 2025 book. The 4% rule’s original publication venue (Journal of Financial Planning, 1994) was also specified.

Contact [email protected] for any questions or corrections.