7 Ways to Retire Comfortably with $1 Million

Many people spend decades building toward retirement only to find themselves unsure whether what they've saved will actually last. If you're approaching retirement with $1 million, the good news is that thoughtful planning can make your hard-earned nest egg work to help you retire comfortably. The challenge is knowing where to focus.

In this article, Fisher Investments walks through seven practical ways to help you retire comfortably with $1 million, covering ways to define your goals, build a budget, manage withdrawals, coordinate Social Security and invest for long-term growth.

#1: Define What “Comfortable Retirement” Means to You

Planning for retirement starts with knowing what you're planning for. Over the years, Fisher Investments has found most people are generally working toward one or more of four financial goals: avoiding running out of money, maintaining or improving their lifestyle, growing wealth for a legacy or spending down their assets over time.

Beyond goals, it's equally important to define your primary investment objective. This is the amount of money you wish to have at the end of your portfolio's time horizon. Do you want to grow purchasing power as much as possible? Maintain your current purchasing power in real terms? Leave a specific amount to heirs or charity? A clear objective creates a roadmap and can help you stay disciplined when markets get volatile.

You can't figure out ways to reach your destination if you don't know where you're going. Defining both your goals and your primary objective is the foundation for every other decision you'll make about ways to retire comfortably with $1 million.

#2: Build a Budget That Covers Both Fixed and Flexible Spending

Once you know what you're aiming for, you can start calculating what retirement will cost. In Fisher Investments’ view, retirees should divide expenses into two categories: non-discretionary and discretionary.

Non-discretionary spending includes costs you can't easily avoid:

• Housing
• Food
• Utilities
• Transportation
• Insurance
• Health care
• Taxes

Discretionary spending covers things like travel, hobbies, gifts, dining out and luxuries. Understanding the difference helps you identify where you have flexibility when needed.

Other budgeting considerations matter too, such as where you live, which can affect whether $1 million will allow you to retire comfortably. For example, $1 million may go much further in one part of the country than another.

Use your current spending as a starting point, then adjust for retirement. Some costs will fall in retirement, while others will rise. Health care deserves careful attention. Historically, health care costs have risen faster than broader inflation and tend to claim a growing share of retirees' budgets over time. Any realistic plan to retire comfortably with $1 million may want to account for that possibility.

#3: Account for Time Horizon, Including Joint Life Expectancy

Your investment time horizon is one of the most important and most overlooked factors in retirement planning. Most people live longer than they expect, and failing to plan for a long retirement is one of the most common regrets retirees have when it comes to retirement planning.

According to Social Security Administration data, a 65-year-old woman has a 52% probability of living to age 85, and there's a 71% chance that at least one member of a couple reaches that age.ⁱ Fisher Investments believes these projections likely underestimate actual life expectancy given ongoing medical advancements. For couples, it's especially important to plan around joint life expectancy: the longer of the two life expectancies.

A retirement lasting 25 to 35 years or more is a realistic planning assumption. If you don't properly account for your time horizon, you risk running out of money well before your retirement ends. If you have $1 million in your retirement nest egg, your time horizon is a key driver of how you should invest along with how much you can safely withdraw each year.

#4: Calculate Your Income Gap and What You Need from Your Portfolio

Before you can build a withdrawal strategy, you need to know how much your investments actually need to contribute to help ensure you can retire comfortably. Fisher Investments recommends starting by adding up all non-investment income: Social Security, pension payments, part-time salary and any income from business or real estate interests.

Once you have that total, subtract it from your expected annual expenses. The difference is your income gap and the amount your portfolio will need to cover each year. For example, a couple with $80,000 in estimated annual expenses and $40,000 in Social Security benefits with no additional non-investment income would need $40,000 per year from their investments to cover their expenses.

This calculation gives your investment strategy a clear purpose. It also helps you realistically assess whether you can retire comfortably with $1 million given your projected income, spending needs and long-term goals.

#5: Plan Sustainable Withdrawals and Avoid the 10% Trap

A sustainable withdrawal plan is critical to making your money last. Fisher Investments believes your withdrawal rate shouldn't be fixed. It should be flexible based on your time horizon, market conditions, asset mix and spending needs.

A common but incorrect assumption is that because equities have historically delivered roughly 10% annualized returns over the long term, it's safe to withdraw 10% per year without drawing down principal.ⁱⁱ That logic doesn't hold. Markets don't move in a straight line, and withdrawing too much during a downturn can do serious damage. If your portfolio is down 20% and you take a 10% distribution, you'd need roughly a 39% gain just to return to the initial value, emphasizing the need for a flexible approach to withdrawals.

While rules of thumb don’t account for your unique situation, most people should plan to withdraw no more than 5% from their portfolio each year. Any time you withdraw more than 5% annually, you're significantly increasing the risk of depleting your assets. Fisher Investments recommends reviewing withdrawals regularly and building flexibility into discretionary spending during difficult market periods. For retirees with $1 million seeking a comfortable retirement, managing withdrawals carefully is one of the most direct ways to help protect the longevity of their savings.

#6: Coordinate Social Security as One Piece of Your Income Plan

Social Security can be a valuable source of cash flow in retirement, but it shouldn't carry the full weight of your income needs. Fisher Investments encourages retirees to think of Social Security as one component of a broader income strategy, not a standalone solution.

The timing of when you claim matters. If you wait beyond full retirement age, your benefits increase by up to 8% per year until age 70.ⁱⁱⁱ Taking benefits early results in a permanent reduction. For couples, the decision is even more nuanced. Both individuals' claiming ages affect not just their own benefits but also potential survivor benefits. The right approach depends on health, the age gap between spouses and near-term cash flow needs.

If delaying Social Security makes sense for your situation, you may be able to bridge the gap using savings, taxable accounts or part-time work in the early years of retirement. Coordinating Social Security thoughtfully alongside your portfolio and other income sources can strengthen your overall plan to retire comfortably with $1 million.

#7: Invest for Growth and Plan for Inflation's Long-Term Impact

Many retirees instinctively shift toward conservative investments to reduce volatility. Fisher Investments thinks neglecting a growth-oriented approach for more conservative investments can be one of the costliest mistakes a retiree makes—particularly over a long time horizon.

That's because your asset allocation—the mix of stocks, bonds, cash and other securities in your portfolio—is the single greatest determinant of portfolio returns and your likelihood of affording the retirement you want. There's a common misperception that bonds are safer than stocks. While bonds carry less short-term volatility, stocks have actually had lower volatility than bonds over 30-year periods and have delivered meaningfully higher returns.^iv Stocks have outperformed bonds in every single 30-year period since reliable data became available.^v If you're withdrawing $50,000 per year from a $1 million portfolio, you need at least a 5% annual return just to keep your balance flat, and that's before accounting for inflation.

Inflation compounds the challenge. Since 1925, inflation has averaged about 3% per year.^vi At that rate, someone who needs $50,000 annually today would need roughly $90,000 in 20 years and about $120,000 in 30 years to maintain the same purchasing power. For retirees seeking to retire comfortably with $1 million, a growth-oriented portfolio isn't a luxury; it's a necessity.

Put Your $1 Million to Work with a Clear Plan

Retiring comfortably on $1 million is achievable, but it requires a carefully planned approach. It takes clearly defined goals, a realistic budget, a disciplined approach to withdrawals and an investment strategy built for a long time horizon.

Fisher Investments helps individuals and families assess their financial situations, build personalized plans and invest to meet their retirement goals. With a tailored approach to portfolio management, personalized service, including financial planning support and annuity evaluation, and a commitment to always putting clients' interests first, Fisher Investments is ready to help you make the most of what you've built. Request an appointment today and take the next step toward the retirement you've worked for.

ⁱ Source: Social Security Administration, Period Life Table, 2021.
ⁱⁱ Source: Finaeon, Inc. as of 3/4/2025. S&P 500 Total Return Index, annual, 12/31/1923 - 12/31/2024.
ⁱⁱⁱ Source: Social Security Administration, as of 5/7/2025. www.ssa.gov/planners/retire/delayret.html
^iv Source: Finaeon, Inc., as of 2/12/2025. Average rate of return from 12/31/1925 through 12/31/2024. Equity return based on Finaeon, Inc.’s World Return Index, Fixed Interest return is based on Finaeon, Inc.’s Global USD Total Return Government Bond Index. Standard Deviation represents the degree of fluctuations in the historical returns. The risk measure is applied to 5- and 30-year annualized returns in the above charts.
^v Ibid.
^vi Source: Finaeon, Inc., as of 2/7/2025. US Consumer Price Index, from 12/31/1925 – 12/31/2024, average annualized inflation was 2.94%.