Can I Retire at 60 With $1 Million?

Knoxville Financial Q&A Episode 13 | Can I Retire at 60 With $1 Million?

September 8, 2026

Can You Retire at 60 With $1 Million?

Having $1 million saved for retirement sounds like it should make the decision to retire at 60 fairly simple. But the amount you've saved is only one part of the equation.

In this episode of the Knoxville Financial Q&A Show, Paul Ragone and Brian Duncan discuss the factors that can determine whether $1 million may be enough to retire at age 60. They look at retirement lifestyle, pensions and other income sources, Social Security, health insurance before Medicare, housing costs, taxes, investment risk, long-term care and planning for a surviving spouse.

They also discuss why the years between retirement and required minimum distributions can create important tax-planning opportunities, including Roth conversions and strategic IRA withdrawals.

Ultimately, the better question may not be “Is $1 million enough to retire?”

It may be:

“Can my income and assets support the retirement lifestyle I want?

Transcript

All right, welcome to episode 13 of the Knoxville Financial Q&A. I'm your host, Brian. I'm Paul. And today's question, pretty good one.

We get it a lot. Yep.

It's, I'm 60 years old. I have a million bucks saved. Can I retire? What would you say?

I would say that's a hard maybe.

There's just not enough info here to answer a question like that.

Yeah, for sure. But it does lead to the question, what kind of things would you look at and what would you start telling that person? You know, hey, this is the scenario.

Yeah. Well, first I would make some assumptions based on the demographic for our show, Knoxville Financial Q&A. So, we're assuming that the person might live in Knoxville.

Yep. We're also assuming, because this is 99% of our clients, that this money is either coming from a 401(k) or is qualified in some way. It's basically never been taxed yet.

Retirement, right?

Okay. So, you take those two assumptions and then maybe we can start formulating a plan from that.

Right. But, you know, there's also questions too. We have a lot of industries around here. So, we've got, you know, as we've talked about before, we've got TVA, we've got Y-12 and the Oak Ridge National Lab. Some of those have pensions, some of those have additional income. So, it'd be, do you have any other income? Do you have a time frame at which you want to start taking Social Security?

We need more info. But, you know, is there a chance? Maybe. Like you said, it's a hard maybe.

And there's also a yes and a no depending on the client's circumstances and quality of life desired, you know.

Okay. If you said, "Okay, all I've got is the million bucks and I don't have anything else." Okay. Well, if you have no desire to pass the money on to your heirs and/or kids or grandkids and you just want to use it till it's gone, you know, if you probably put yourself on anywhere from a three to four and a half percent withdrawal.

So, if you can live on 40 grand a year, if you're doing the 4% rule of thumb, which we don't really believe in a rule of thumb—it's client dependent—but, you know, if that's something that you can do, perfect.

Yeah. Then the answer is yes.

Yeah.

Or if they're waiting and delaying for Social Security, they only have to live like that for a short period of time, right? That's an important factor. So, if you do retire at 60, you got two years before you can possibly claim Social Security. So, what are you going to fill that gap in with?

Yeah. And maybe you have a five or 6% withdrawal for your first two years and then turn on Social Security and allow that to be the difference and then reduce your withdrawal.

Right. So, yeah, is the answer maybe?

But, I mean, it could happen. It could. Part of it comes down to what is your expectation in retirement? And I think that's where a lot of people break down. Every day becomes the weekend.

Could you live on 40,000? You may not want to.

Another thing that could really impact this whole thing, which we really can't predict as financial advisors, is the sequence of return risk.

Yep. Yeah. You definitely are exposed there.

Yeah. So, you retire at 60, market's doing great, and all of a sudden you got two years in a row where the market's just terrible. That's going to royally screw up any sort of retirement plans that you had.

You know, if you are that 60-year-old person that comes in here with a million bucks and says, "Look, this is all the money I've got. I need it to last for the rest of my life. I don't want to lose any." Well, that means we're not taking much risk.

Yep.

Which means you're not keeping up with the cost of living or inflation, right?

You have to make an adjustment in your mind that you're going to need to take on some risk if you want that money to last because people are living longer. You know, you're looking at a 30-year runway from that point.

Yeah.

Possibly. Right. And so, God forbid, like, you know, you get to 85, you still have some money and then you're checked into a nursing home.

That brings up important planning parts, too, when you start looking at, like, if all you got is the million bucks, but your house is paid for. So, if you have a $500,000 house, $600,000 or a million-dollar house, part of protecting that, you know, if you go into a home, you got to make sure that your assets are protected because if you run out of money and go into a home, big trouble. They start seizing them, especially and shift you to the state-run type facilities.

So, there are some pitfalls from the planning perspective that most people need to be aware of.

Yeah. Yeah. I mean, I think before you can give an answer to that question, is your house paid off or do you have a big mortgage?

Yeah.

I mean, these kinds of things matter. If you like to travel a lot and probably live above your means, you're probably going to have a no for an answer there. I think the answer could be yes if you live below your means or you just live a pretty conservative lifestyle, right? You have a pension. That's a huge deal here because a lot of the facilities provide them.

Yep.

And you don't have a mortgage, and so you can definitely pull that off.

Yeah, I think that it's just missing giant chunks of information that are very important to be able to answer that correctly.

Right.

I do think it's a possibility, but it's just, yeah, that question is just too vague to be able to answer, right? We don't know if you have a spouse, and is your spouse also retiring at 60 or is your spouse still working, and can you be on your spouse's health insurance?

Yeah, because the health insurance part matters.

Or are you going to have to pay COBRA or come up with your own health insurance through the ACA? I mean, there's just so many different scenarios. And if anybody, you know, if anybody posts some video out there that says, "Oh, you can definitely do this," be scared.

So, I think the answer is a hard, hard maybe until we know all the details.

Yeah. And don't forget, you know, at 60, you're five years away from Medicare.

Yep.

As we talked about, or as I talked about on the Social Security side of things, you know, that's something to think about, too, is if you have a spouse pass away, you get a reduction in your Social Security income. Usually it's whichever one was higher, right? And that's it. And so, yeah, you could lose a chunk of your income that you plan on having. That affects the million-dollar lifespan.

Yeah. So, basically, if you're asking if you can retire with a million dollars at 60, well, we have to also plan for spousal planning. So, another thing that we have to look at is taxes between age 60 and RMD age.

Yeah, I think that's a big giant—I'm dealing with this right now with a client. You know, one of the things we're having a conversation of is they want to delay the RMDs as long as possible because there's a substantial nest egg there and working through that, trying to burn that pile down because as soon as Social Security starts, they don't want to have the provisional income.

It's almost no way around it at this point based on what we've got. It's like we're still going to run into that. It's just how big of a problem is it going to be?

And if you do retire at 60, you're probably going to be in the lowest tax bracket you've been in quite some time. So, that gives you the opportunity to start doing Roth conversions or just, you know, strategic IRA withdrawals.

That can also induce panic by people that, you know, you start seeing that balance drop because you're either burning through it, trying to dwindle the pile down, which is the goal, but it's also scary because you're sitting there going, "Well, I had the million dollars. I just, you know, moved 100,000 to Roth and then took 50,000 to live on. 50 grand just disappeared," you know, like it's being used.

And so, yeah, that's probably a very scary thought process when you're used to accumulating.

If done correctly, though, the amount of taxes that you save over the rest of your life, well worth it.

Yeah, huge difference. And like we said in the last episode, don't wait until it's RMD time to learn about RMDs.

Yeah, that's for sure.

Something that you glossed over when we talked about, like, going into a nursing home or something—long-term care. You know, this would be one of the questions. Do you have a long-term care policy?

If you don't, long-term care isn't as good as it used to be. I think they realized it was somewhat unsustainable, and so they started trimming down some of those benefits. And so, if you've only got a million bucks and you want to start looking at a long-term care plan, it's too little too late.

I think at this point, there are some annuities and some stuff that you might be able to get some benefits, but I don't know that that would be the route I would go. It's just long-term care isn't what it used to be. And if you've only got a million bucks, I wouldn't be looking at that route.

They know you're going to die, right? And so, they figured all this stuff out, but basically they allow you to access your death benefit early.

Yeah. Every company's different. This would be the challenge that I would say: if you're relying on your life insurance policy to be what cares for you in a nursing home, make sure you're aware of how it works.

Yeah, I would definitely consider that benefit as more of a supplement to whatever else you have in place versus true long-term care.

You have a million dollars, you're 60 years old, you live an extravagant lifestyle, you don't have a pension, and you still have a mortgage. Nope, you cannot retire at 60.

And then on the flip side of that, 60 years old, million bucks, your mortgage is paid off, you live a very normal lifestyle, you have a pension, you're good to go.

You can probably pull that off no problem.

Yeah. No pension, no additional, no rental income. We haven't even brought up that. You know, like maybe you got rental properties.

Yeah. If you've got no other sources of income, the answer is I hope you don't have a lot of travel goals and/or other extravagant—because the answer is maybe. If the answer is we've got rental properties and pensions and all that other stuff, million bucks, you're good.

Yep. And this is a true story. Like, I have a client who's 60 years old. He's got about 300,000 in assets saved, but he has incredible benefits. Everything from health insurance to amazing pension. And he can pull that off easily. In fact, he's not even planning on touching the 300,000.

You know, the million bucks really isn't—it's not about an asset value or an account value. It's more about a revenue value.

Yeah. And it seems like a million bucks used to be like the benchmark. Wow, I've got it. And it's your lifestyle determines if that million bucks is going to last.

Yeah. So, that's the conversation I have with even a lot of the young people that I talk to just starting out. It's kind of like, you know, a million bucks is—if you trim off the million-dollar tag and you view it only as a $40,000 to $60,000 a year income stream, it's how many of those do you want? Not a matter of how many millions do you want. It's a matter of here's the revenue that it can produce. How many of those do you want? You know, it's like that's what I look at it as.

A million dollars minus taxes is not a million dollars anymore.

So, the closing takeaway here is, is $1 million enough to retire?

I'd say the better question is, can my income and my assets—or, as we talked about, my income—support the lifestyle that I want? That's the better question there.

All right. So, with that said, signing off.

Signing off.