Hahah.. yeaeah I kn..
It comes down to fear vs greed.. Actually both at the same time in my case.
I am very risk adverse by nature so I can easily see a big drop in the markets, our large rental burning down (or the markets tank just after the rental trailer burns down.. Oh and those pension projections were just a scam anyway.
The greed part of me says... hey I'd rather have $3M rather than $1.5 and dammit we will travel everywhere business class when the Wife retires...
So yes very much a first world problem I would aggree.
I am much more likely to be the crazy old guy with $10M stashed in the mattress at 92 still scraping by on a $20k a year spend rate..:)
Well - the part of you that could have $10M and still feel poor is rooted in behavior & psycology, not economics. Not sure how to combat that.
As for being 'risk-adverse' - there's two sides to risk. What you could loose by doing something, and what you won't gain by doing something. Stuffing it all under your mattress is a surefire way of avoiding loss (except through inflation) at all costs but it's also a surefire way of not seeing any gains. So while principle is preserved it's actually more 'risky' than putting that money into a low-yield savings account. etc etc.
I'll make this suggestion based on my own planning (still a decade+ away). Plan on enough money for X number of years in bonds or secure bond-like investments, and put the rest in a low-cost equity index fund. When the markets dive pull money from your bond fund until it recovers, and then replenish/rebalance with money from your equities.
With your spending and savings, you could put a very conservative $300k - or
10 years of your spending - into a bond fund, and still keep $1M in your index fund. Use any income from rentals, wife's job or pension towards your spending, thus reducing what you need from your portfolio.
With your assets and adversion to loss I personally don't like coming up with a specific "AA-Ratio". Just figure out how many year's of cash you'd need to feel secure that your portfolio will weather the worst economic storm. Using the great-depression as a benchmark, 10 years seems fair even withOUT all that extra income you have on the side.
Or this: consider that $1.3M gives you 43 years of withdraws if all you ever do is keep up with inflation.
You've got it made. Stop worrying :-)