Can You Retire at 57 with $1.8 Million? Here’s What the Math Says
- Joe Boughan
- Sep 26
- 6 min read
Most people delay retirement out of fear — even when they could retire comfortably.
The irony? By the time they feel “ready,” many have already spent their healthiest, most energetic years working longer than necessary.
The truth is, retiring early feels risky. But what if the real risk is waiting too long?
🎥 Before You Read On
If you prefer visuals, check out our video explaining Parkmount Financial Partners’ Retirement Strategy — it shows how our process helps clients create retirement income clarity and peace of mind.
Meet Steve and Betty:
The 57-Year-Old Couple with $1.8 Million Saved
Steve (57) and Betty (49) wanted to know: Can we retire now — and make it last 40 years or more?
They live in Massachusetts and have two adult sons living at home rent-free while getting established.
Together they own two properties (a paid-off primary home and a beach house where they plan to retire), and $1.8 million across multiple accounts:
$700K IRA
$300K 401(k) (mix of Roth and pre-tax)
$200K inherited IRA (pre-2019 stretch)
$500K taxable brokerage concentrated in a major tech stock
Steve earns $180,000 as the sole provider, while Betty manages the household. They plan to sell their primary home soon, freeing about $100K after expenses to supplement retirement savings.
Their retirement goal? $7,000/month for essentials, plus $12,000/year for travel and hobbies.
But like many pre-retirees, they had serious concerns. They reached out to work with us as a financial planner to solve the following questions:
What if their early-year withdrawals (over 8%) were too high?
What about health insurance before Medicare?
How do they manage taxes and concentrated stock?
Could their portfolio truly last 40 years?
Running the Numbers: From 64% to 92% Retirement Success
When we ran their base plan through a Monte Carlo simulation, the result was a 64% probability of success.
Think of Monte Carlo as rolling the dice thousands of times to model how different market conditions might play out. In 640 out of 1,000 simulations, their portfolio lasted through retirement. But would you board a plane with a 36% chance of crashing? Probably not.
So, we went deeper — improving withdrawal efficiency, tax planning, and portfolio structure.
After adjustments, their plan rose to ~92% success!
1️⃣ Guardrails, Not Guesswork: Managing Income Flexibly
We built a guardrail-based income strategy — a dynamic withdrawal framework where income adjusts when markets rise or fall beyond set thresholds.
If markets outperform, income can rise by ~10%.
If markets underperform or spending runs high, distributions pull back slightly.
In normal years, income simply grows with inflation.
This “adaptive spending” approach has academic support showing 10–20% higher sustainable income without extra portfolio risk (Journal of Financial Planning, Guyton & Klinger, 2006).
Early-year withdrawal rates were high (~9%) but projected to drop to 6–7% once they sold their primary home, then to ~1% once both Social Security benefits began so the plan had a lot of long-term strength, even with a withdrawal rate that was really high at the start.
This meant that they would be facing a lot of risk early on, especially if markets dropped, but we talked about contingency plans that they had available, and they were able to feel confident in the scenarios we had in place for them.
2️⃣ Precision Tax Planning: Turning Efficiency into Longevity
Next, we built a multi-layered tax strategy:
0% Capital Gains Harvesting: They diversified tech stock holdings within the 0% bracket, realizing ~$96K tax-free. (IRS Topic 409 – Capital Gains)
ACA Subsidy Optimization: By managing reported income, they qualified for Affordable Care Act healthcare subsidies before Medicare (HealthCare.gov Subsidy Calculator).
Roth Conversion Window: We identified low-tax years post-retirement for strategic Roth conversions at 0–10% marginal rates, boosting lifetime tax efficiency.
Roth Conversion Analysis
Our modeling showed these steps could add potential for $300K+ in projected lifetime after-tax value — all from strategic sequencing and withdrawal timing.
3️⃣ Life-Aligned Investing: Managing the “Retirement Risk Zone”
The first five years around retirement are crucial — what academics call the “sequence of returns risk.” Poor early-market performance can permanently derail an otherwise solid plan.
So, we segmented their portfolio into two “buckets”:
Bucket 1: ~$400K in conservative assets (≈4 years of spending) for stability and short-term needs. This includes a diversified mix of higher quality fixed income and money markets and possibly buffered ETF funds that have a strong amount of buffer applied to them.
Bucket 2: Remainder in diversified equities (~80%) for long-term growth and inflation defense.
This way, even in down markets, withdrawals come from Bucket 1 — avoiding the need to sell equities at a loss. It’s a hybrid between time-segmentation and guardrail strategies, designed for durability and confidence.
Research shows that 50-70% Equity is healthy for a retirement portfolio to provide growth necessary to outpace inflation, but it's not for everyone. Steve's plan called for 80% equity in retirement which can make sense but is somewhat unique to his high-risk tolerance and high confidence in markets combined with his wife Betty's age disparity, meaning she has a higher time horizon since she is almost 50, where Steve is a bit older.
What Surprised Steve and Betty
They were astonished that early retirement was actually feasible.
They’d assumed the “4% rule” disqualified them.
Seeing a tailored, numbers-backed plan changed everything:
Healthcare + tax efficiency saved potentially thousands annually.
Dynamic guardrails reduced anxiety about market drops.
Sequence-proof design showed staying invested could work long-term.
Most importantly, they realized the value of clarity: structured planning turns fear into freedom.
Final Outcome
✔️ Retire now, spend confidently.
✔️ Drop expenses after selling their home.
✔️ Enjoy family and travel while protecting long-term sustainability.
Yes, they could afford to retire — not by luck. There is still real risks that they face, but now they have better clarity, planning, and adaptability.
🎯 Ready to See Your Own Numbers?
If Steve and Betty’s story feels familiar, take 30 seconds to complete our short Retirement Readiness Questionnaire.
We’ll send you a free 5-minute personalized video showing your retirement outlook — your potential income, spending guardrails, and tax opportunities. No sales pitch, no jargon — just clarity.
🎥 Next Step: Watch Our Retirement Strategy Video
Learn how we model real-world retirement decisions and create flexibility for every stage of life. Then, if it makes sense, schedule a free financial planner consultation to explore your personalized plan.
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