Over the last 35+ years I’ve spoken with literally hundreds of people convinced they were seriously preparing for retirement. The problem for many is one of scale. For a couple in their 40s who make $80,000 yearly between them, $250,000 is one heckuva lotta money. Yet, if they’re 45, retiring at 65, turning that amount into $1 million would require 20 consecutive years of just under 7.2% annual yield. No losing years allowed. ‘Course, they’re gonna have a down year or two, right? That means a few months to a few years on the ol’ treadmill catchin’ up to where they were when Murphy showed up. At that point, more likely than not, double digit returns would be needed to arrive at the coveted million dollar mark. A million bucks at retirement probably ain’t gonna cut it for most retirees. Think about it. For those getting their income from 401s and IRAs, two things sober ’em up big time, and quickly. 1. Every single dollar coming out of their plan is taxed. Want more articles like this? Create an account today to get BiggerPocket's best blog articles delivered to your inbox Sign up for free 2. If they were 65 today, the 10 year treasury bond would yield them exactly $19,000 a year plus two $5 foot-longs at Subway — before taxes. The same million bucks in debt free real estate? Well located real estate, assuming no increase ever, as in never-ever, in net operating income (NOI), the income would be roughly $60-80,000/yr give or take. $1,000/mo into an EIUL from 28 years old ’til 58, with inflation adjustments of about 2% annually on the premiums, will get my own daughter and her newish hubby around $100,000 annually — tax free — ’til they die. The combination of those two investment vehicles, wisely used, with careful and Purposeful Planning, will slaughter, literally, the anemic performance of a million bucks in the average couple’s 401k or IRA. Thing is, Purposeful long term real estate investing is relatively rare. This is especially true when compared to those with the ‘qualified retirement plans’ at work. Seems most everybody has one, but they’ll quickly tell us how the performance has been mediocre at best, and dismal at worst. What TV does with real estate is Barnum and Bailey. There’s the required flipper. Then they find a property. Then there’s some false drama created to keep us coming back after the commercials. Then they make a profit. Then it’s time for the new Netflix movie that came in the mail today. The Takeaway Your 401k or IRA ain’t gonna get ya there, regardless of what you’ve been told. The next person who tells me about the six figure retirement income they’re enjoying, courtesy of their 401 or IRA — will be the first. They gotta be out there, but I’ve yet to meet one. Are you gonna be the exception proving the rule? Not freakin’ likely. Marshal your capital, and commit to learning about how to invest in real estate, long term. Don’t travel the road most are on, it’s a dead end. There are thousands of Americans thinkin’ they’ve succeeded with their retirement plans, solely due to the fact they’re nest egg requires two commas. They were woefully misled, but after the last guest at the retirement party leaves, it’s a bit late. Now, it might not be too late, IF, that million bucks can be extracted tax free. Alas, a pipe dream for most. What’s that I see comin’ round the corner? Another birthday? Time . . . is . . . not . . . your . . . friend.