“I would retire if I had $5 million.”
The number sounds precise, but it represents a feeling, not a calculation. No expected spending, taxes, housing costs, or withdrawal rate have been established.
Core question:
What monthly lifestyle are you trying to finance, where do you plan to live, what asset allocation do you expect to use, and why does it require $5 million?
Explanation:
People often use a large round number to express, “I would finally feel safe.” Usually, the number is two to five times larger than what the person currently has. From a financial perspective, it makes no sense. Psychologically, it allows them to postpone thinking and planning.