How To Retire on 4 Million Dollars

Shawn Plummer

CEO, The Annuity Expert

Can I retire with 4 million dollars? This guide will show you how to retire on 4 million dollars step-by-step. In addition, we’ll provide estimates on your retirement income at different age brackets.

If you are close to transitioning to retirement, check our Retirement Planning Guide.

If you are not close to transitioning to retirement, check out our Guaranteed Retirement Income Guide.

Use an annuity calculator to get a better idea of the retirement income generated.

This guide will answer the following commonly asked questions:

  • Can I retire on $4 million?
  • Can I retire at 55 with $4 million?

How to Retire on 4 Million Dollars

The average monthly Social Security Income check in 2021 is $1,543 per person. In the tables below, we’ll use an annuity with a lifetime income rider coupled with SSI to provide you a better idea of the income you could receive off a $4,000,000 in savings. The data will be based on:

How to Retire on 4 Million Dollars, Immediately

The table below illustrates how much monthly income can be generated immediately with a combination of annuity payments and Social Security Income (SSI).

ADDITIONAL READINGHow Much Does A $1,000,000 Annuity Pay?

If you retire on a $4,000,000 annuity, starting immediately, your monthly income for life would be:

AgeSSIAnnuityTotal
62$3,086$17,280$20,366
65$3,086$18,884$21,970
70$3,086$20,532$23,618
Total = Monthly Income for Life

How to Retire on 4 Million Dollars in 5 Years

The table below illustrates how much monthly income can be generated in 5 years with a combination of annuity payments and Social Security Income (SSI). If you retire in 5 years on a $4,000,000 annuity, your monthly income for life would be:

AgeSSIAnnuityTotal
62$3,086$25,492$28,578
65$3,086$27,000$30,086
70$3,086$30,088$33,174
Total = Monthly Income for Life

How to Retire on 4 Million Dollars in 20 Years

The table below illustrates how much monthly income can be generated in 5 years with a combination of annuity payments and Social Security Income (SSI). If you retire in 20 years on $4,000,000, your monthly income for life would be:

AgeSSIAnnuityTotal
40$3,086$35,124$38,210
45$3,086$39,524$42,610
50$3,086$44,400$47,486
Total = Monthly Income for Life

How To Retire On $4 Million By Age

The following guaranteed income amounts are on an annual basis and do not include Social Security Benefits.

Retire At Age 55 With $4 Million.

Annuity Purchase DateAnnual Income At 55
Age 40$328,908
Age 45$326,312
Age 50$244,996
Age 55$188,000

Retire At Age 60 With $4 Million.

Annuity Purchase DateAnnual Income At 60
Age 40$421,520
Age 45$379,976
Age 50$360,760
Age 55$264,128

Retire At Age 65 With $4 Million.

The following guaranteed income amounts are on an annual basis and do not include Social Security Benefits.

Annuity Purchase DateAnnual Income At 65
Age 40$516,732
Age 45$474,320
Age 50$438,060
Age 55$400,848

Why Use An Annuity?

Why use an annuity? Currently, annuities are the only retirement plan in the United States that provides a guaranteed income for a lifetime, even if the plan runs out of money. The annuity is basically a money management tool in retirement, taking all the guesswork in budgeting your day-to-day expenses. By utilizing this financial plan, a retiree will never have to worry about running out of money, ever.

Annuity Basics

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Understanding Lifetime Income Riders

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Estimate Your Retirement Income Payments

Take advantage of 17 different annuity calculators to generate estimates, then request a quote.

Keeping Up With Inflation

Some annuities offer a guaranteed lifetime income with the ability to increase regularly to keep up with inflation. Once the income increases, the payment amount is locked in and can never go backward from that point forward.

Example

A 40-year-old purchases a $1,000,000 annuity with a lifetime income rider to retire at age 60. At age 60, the lifetime income amount may be guaranteed $105,380 initially but hypothetically increases to $288,439 by age 67. Once the income has increased to $288,439 annually, this payment is locked in and can never go below $288,439 in the future.

On the other hand, a performance-based annuity may hypothetically generate an income of $381,349 a year for life starting at age 60, increasing to $636,610 a year by age 70. Once the income has increased to $636,610 annually, this payment is locked in and can never go below $636,610 in the future.

Things To Consider When Retiring

Find Out How Much Income Your $4 Million Will Provide In Retirement

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Frequently Asked Questions

Is $4 million enough to retire at 50?

Yes, you can retire at 50 with four million dollars. At age 50, an annuity will provide a guaranteed level income of $145,200 annually starting immediately, for the rest of the insured’s lifetime. The income will stay the same and never decrease.

If the annuitant selected the increasing income option, they would receive $124,200 annually initially with the income amount increasing over time to keep up with inflation.

Either lifetime income option will continue to pay the annuitant, even after the annuity has run out of money. At the time of the annuitant’s death, the designated beneficiary will inherit the remainder of the annuity.

Is $4 million enough to retire at 55?

Yes, you can retire at 55 with four million dollars. At age 55, an annuity will provide a guaranteed level income of $158,400 annually starting immediately, for the rest of the insured’s lifetime. The income will stay the same and never decrease.

If the annuitant selected the increasing income option, they would receive $129,600 annually initially with the income amount increasing over time to keep up with inflation.

Either lifetime income option will continue to pay the annuitant, even after the annuity has run out of money. At the time of the annuitant’s death, the designated beneficiary will inherit the remainder of the annuity.

Is $4 million enough to retire at 60?

Yes, you can retire at 60 with four million dollars. At age 60, an annuity will provide a guaranteed level income of $189,200 annually starting immediately, for the rest of the insured’s lifetime. The income will stay the same and never decrease.

If the annuitant selected the increasing income option, they would receive $160,000 annually initially with the income amount increasing over time to keep up with inflation.

Either lifetime income option will continue to pay the annuitant, even after the annuity has run out of money. At the time of the annuitant’s death, the designated beneficiary will inherit the remainder of the annuity.

Is $4 million enough to retire at 65?

Yes, you can retire at 65 with four million dollars. At age 65, an annuity will provide a guaranteed level income of $206,400 annually starting immediately, for the rest of the insured’s lifetime. The income will stay the same and never decrease.

If the annuitant selected the increasing income option, they would receive $180,000 annually initially with the income amount increasing over time to keep up with inflation.

Either lifetime income option will continue to pay the annuitant, even after the annuity has run out of money. At the time of the annuitant’s death, the designated beneficiary will inherit the remainder of the annuity.

These rates are based on an immediate payout. The longer the annuitant waits after purchasing an annuity, the higher the income amounts will be. Rates can change and vary by state.

Shawn Plummer

CEO, The Annuity Expert

I’m a licensed financial professional focusing on annuities and insurance for more than a decade. My former role was training financial advisors, including for a Fortune Global 500 insurance company. I’ve been featured in Time Magazine, Yahoo! Finance, MSN, SmartAsset, Entrepreneur, Bloomberg, The Simple Dollar, U.S. News and World Report, and Women’s Health Magazine.

The Annuity Expert is an online insurance agency servicing consumers across the United States. My goal is to help you take the guesswork out of retirement planning or find the best insurance coverage at the cheapest rates for you. 

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