How to Save $1.5 Million and Retire at 50 with No Debt

 In Personal Finance, Retirement

retire at 50

Who wouldn’t want to retire at 50 with $1.5 million in the bank and the ability to do whatever they wanted, whenever they wanted?

Sadly, too many people will never enjoy this freedom just because they didn’t know they could. It’s actually a simple matter to save and retire early, as Carl or Mr.1500 mentions on his blog 1500Days.

I would also recommend that you study his blog – it’s not only educational, but inspirational. The real challenge is educating yourself as to the process and the best practices involved. We’ll break the entire process down below.

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Know How Much Time You Have to Retire at 50

The first step here is to know how long you have to save for retirement. If you want to retire at 50, just subtract your current age from 50. So, if you’re 35, that means you have 15 years to build your savings to the point that you can ride off into the sunset when you hit 50 years old.

Plan Your Investment Earnings

Now that you know how many years you have in which to save, it’s time to plan how much you expect your investments to earn during that period. This can be a little tricky, because it requires a good understanding of your risk aversion.

Risk aversion (or risk tolerance, if you prefer) is simply how much risk you can stand. Would losing your investment capital devastate you financially? If so, then you need to play it safe. If you have capital to spend that won’t impact your day-to-day living, then you have a little more flexibility here.

You also need to know more about the available investment vehicles. Make no mistake – they’re not even remotely similar, so let’s discuss some of them below.

However, before we begin, understand that past performance cannot be used as an indicator of future performance.

Sure, it suggests that a particular investment vehicle might behave in a certain way, but that’s not a guarantee.

In addition, being able to leave your investment alone for a longer period (called the investment horizon) means that you’ll make larger gains over time and will earn closer to the “historical long-term average,” also known as historical performance.


Stocks are perhaps the first thing that comes to mind when people talk about investing for the future. You play the stock market, make a good return, and retire early, right?

Actually, that’s probably not the way things will work. The stock market is incredibly volatile, and it’s possible to lose not only all of your gains in seconds, but your investment capital as well.

Combine that with the fact that we’re nearing peak market valuation (after which everything goes downhill), and you can see why this might be an option only for those with money to burn.

The average stock market performance has been historically low for the past 20 years, and things are not going to improve for at least another 40 years.
early retirement


Cash investment options include things like money market accounts. These are generally short-term investment vehicles that can offer some growth, although they do not perform as well as others. They are among the safest options, though, and experience very little in the way of volatility.


When it comes to a safe haven for your investment funds, bonds are it. Bonds do not suffer from a fluctuating return the way that stocks do. And while you don’t have the (exceptionally rare) chance of really hitting it big with a surprise win, you also don’t have the chance of experiencing the soul-crushing losses that the stock market all too often incurs.

While Treasury bonds are probably the most common options, high-quality US corporate bonds are better options. Many corporate bonds actually outperform stocks, and by creating a bond ladder, you can stagger the maturity dates so that you have a constant stream of income.

You will need to determine the right mix of these three methods for your particular portfolio, based on your risk tolerance and where you are at on the road to being able to retire at 50 years of age.

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Know How Much You Must Save Per Month

retire at 50

Next up, you will need to know exactly how much money you need to save per month. If you have a long time until you reach 50, then you will need to save less per month than someone who is nearing the 50-year mark.

However, the more you save (beyond the amount you are required to), the more comfortable your retirement will be and the more likely you’ll be able to live debt free.

Let’s say that you have 15 years left until you reach 50 and you have already saved $200,000. That means you will need to save over $1,600 per month, plus your investment returns at 10%.

If your return is 6%, you’ll need to save almost $3,600 per month.

However, the future return estimated by McKenzie might turn around, and your investment return could be far less than those levels.

Be prepared for the fact that your return might only be around 4% for investments over the next 40 years, which means you would need to save nearly $4,700 per month.

It is not an easy task

The key to this is living below your means. It’s not something most people want to consider, but it can be done, and it can be done in a way that allows you to live comfortably.

You just have to plan for it, and then stick to your plan come hell or high water.

In the end, any effort toward saving money now will be rewarded.

However, the longer you have to invest, the more time there is for compound interest to work its magic, and the closer you’ll be to the $1.5 million mark when you retire at 50 years old.

Plan exactly how much you need to save each month, know your risk tolerance, and choose your investment vehicles wisely.

early retirement

Sergey Sanko
Sergey had started an IncomeClub after years of being an investment advisor for high affluent investors and managing fixed income securities. He is the lead investment advisor representative and holds a Series 65 license. Sergey earned his Executive MBA degree from Antwerp Management School.
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