Rich old people have to deal with a ton of BS. Excess capital, if it happens completely accidentally is one thing; but purposely putting oneself in a position that statistically almost guarantees excess capital by working more than wanted will create headaches later in life, not solve them. OTOH if someone believes "A", then safe away.
Can you offer some examples of the BS and headaches we need to avoid or address?
Tax complexity (depending on investments)
Being a target of scams
Relations with relatives strained
Friends/relatives begging for help
Oversized house maintenance
Isolation from less-wealthy friends during retirement years
I don't believe any of these issues, in isolation or in the aggregate, are in any way unmanageable. I agree with you that unhealthy excess is, well, unhealthy. But when the alternative is the risk of not having enough, I'll take the problems on your list in a heartbeat.
It's all a matter of perspective. I suspect that being 85 years old with three million dollars in investments is significantly less stressful than being 85 with a billion dollars. Rich old people are targets. The extra money doesn't really get you anything except stress and abuse and trust issues. You're not going to spend it all either way.
Similarly, having one million is probably better than having three million. Is having 500k left at that age (in today's dollars) better than 1mil? Now we're getting down to the point where you could theoretically want to spend that money on nursing care or medical care if you live too long.
The whole point of this website, gofu, is to help you make the mental leap away from the scarcity mindset. Fear of poverty is a bad motivator. What is really "enough" in a world where millions die each year of starvation or bad sanitation services but jeff bezos can spend $42million on a clock, as a hobby? You are already fabulously wealthy compared to almost every human who has ever lived, and you will never be as wealthy as someone like jeff. Why do you really want more? Why isn't today "enough"?
In reality, doubling your next egg from today's value will have essentially zero impact on your quality of life. You will still have a home, and food, and a car, and an approximately middle class American lifestyle. Arguably, the extra years spent sitting in cubicle for a high stress job are much more detrimental to your quality of life than is not having more money.
I suspect that being 85 years old with a hundred bucks is significantly more stressful than being 85 with a billion. Whether 3 million is better than one million at that age would I suspect depend mainly on your health, but in many cases I agree it might make no difference.
But I disagree that someone who wants to retire in 2018 at age 40, or even 50 or 60, is in the same position with 1 million as he is with 2 million. As if that extra million dollars makes no difference to a sense of financial security, let alone the ability to take care of family and do some good in the world. A lot of people would have no need or use for the extra million, but a lot of people would. Maybe I’ll do a poll and ask people if, all else being equal, they would rather retire with 1 million or 2 million.
This is not to suggest that people should pursue the extra million (or any other amount) without regard to the cost in time, opportunity to do other things or diminution in mental or physical health. Everyone is different and if the time and effort to earn money are not worth it then by all means stop that activity and conform your life to your resources.
I don’t think it betrays a scarcity mindset or fear of poverty to take a conservative or even cautious approach to making sure one’s accumulation is sufficient to last the rest of one’s days. Nobody can predict down to the dollar how much will be needed and my humble view is that it is better to err on the side of too much rather than too little. Quite to the contrary of a scarcity mindset I am pursuing a life of abundance both now and with preparations for the future.
In any case, a properly channeled fear of poverty can indeed be a very good motivator. We all have that fear to one degree or another. That is why we save and plan and optimize, to make sure we can achieve and maintain a certain quality of life and to ensure we don’t end up on the street or burdening others. Just like a fear of dark alleys in a bad part of town, at the right time, in the right place and to the right degree the right fear is a most healthy and useful thing.
Much less healthy and useful is comparing one’s situation to the needs, desires and resources of others. What difference does it make how rich or poor I am compared to anyone else? If I compared myself to my next-door neighbor I would get pilloried on this site for it and rightly so. Why then should I evaluate my needs and desires by the standards of mud hut villagers or multibillionaires who buy ridiculous clocks? They have nothing to do with me in terms of how much money I require to live and to properly and securely fund my retirement.
As I said before, unhealthy excess is axiomatically unhealthy. That includes the excessive pursuit of wealth accumulation, and it also includes an excessive fear of the potential pitfalls of having too much money in decrepitude. I would counsel against either excess.
The point of this thread is safe withdrawal rates. I would prefer to be in a financial position to not have to worry too much about whether I am withdrawing 3.5% or 5% in any given year regardless of almost any circumstance. And I prefer to be in a financial position where I don’t need to stay ready to jump back into the work force to ride out tough times if they hit. I see nothing wrong with pursuing that in a manner consistent with my own contentment and physical and mental well being.