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$1 Million Doesn't Go As Far As It Once Did (And We Break Down The Numbers As Proof)

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Remember when you were younger and thought that one million dollars would be the most amazing thing in the entire world? Where you could live out all of your fantasies, retire from whatever it is you're doing and live a life of luxury and high-class? Yeah, that sure seems like nothing more than a pipe dream these days.

It's not that one million dollars isn't a hell of a lot of money — or that you're incapable of becoming a millionaire — it is and you are. Problem is, thanks to inflation, cost of living in each state and a few other factors, saying that you have one million dollars doesn't exactly get you a seat at the high rollers table anymore. It's sad, but, alas, that's how things go nowadays.

To further prove that point, take a look at this chart from MarketWatch, which breaks down just how long one million dollars will last a person in each state, via HowMuch.

With this knowledge, a person with one million dollars in savings who's living in Mississippi has things a hell of a lot better than someone with the same amount of cash saved who's living in Hawaii. That's because the Mississippi resident can have that money last for, presumably, 25.5 years, whereas the person in Hawaii only has there cash last 13 years, 1 month. Talk about a total buzzkill, right?

To help get your retirement savings in order — even for those 20-somethings who aren't thinking about it right now — it's important to remember the 3-4 percent rule, which is the suggested rule that most financial experts live by when it comes to retirement. That rules means that, whatever you're saving each year for retirement, you can safely withdraw 3 or 4 percent and your money should last forever.

So, let's breakdown your expenses each year and how far one million dollars would really last you, shall we? For the sake of staying consistent, let's just go with the 3 percent rule, with assumptions of factors such as a 2.9% rate of inflation and a portfolio of 75% equities and 25% fixed income. This is the big reveal, guys, so pay close attention.

To help with your retirement savings goals, here's a helpful chart to follow from J.P. Morgan Asset Management, via Investors.com.

One million dollars may have once been the financial goal that would solve all your problems. Unfortunately, as we show above, it doesn't go as far as it once did, so getting your retirement savings intact is the most responsible way to make it last as long as possible.

BroBible, Investors

Lead image via Getty.

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