I guess the issue is that if one invests in safe areas like bonds or term deposits as one gets older, the the min drawn down along with inflation will cause a $1m to be used rather quicker than the life expectancy.
If you are getting 4% on term deposit and drawing down >4%, then your capital is starting to reduce, and by the time you get to 85 it is disappearing rapidly. With a $1m starting point many will draw more than the min each year. $40k a year is not much to live on, IMO.
I'm 58 and wife is 53 - there is a 15% chance (from memory -please correct if wrong) one of us will be alive in 25 years time, so the pension needs to last a good few years to avoid penury. Wife will be under 80 at that point and one assume she will need a reasonable pension. I believe there is a 5% chance of one of us being around after 40 years.
Thus my number, and it is a personal thing, is $2m.
