By Lee Eisenberg

The Number is yet another financial / retirement planning book that purports to help the reader figure out what their “Number” is: the amount of money needed to retire comfortably. It’s much less “how to” in favor of contemplating “why.” I found this approach alternately fascinating and frustrating.

Much of the book has us pondering the meaning of a fulfilling life, saving the formula for the “number” until the very end. In the interest of a concise review, here are the steps to calculate “The Number”:

1. Estimate how much you’ll need to live on per year in retirement.
2. It’s safe to withdraw around 4 percent annually from a reasonably well diversified portfolio.
3. Do the math to get “The Number.” If you think you need, say, $100,000 to live on annually, you’ll $2.5 million on the day you decide quit working.

The problem is the wide range of possible answers for #1. It will vary widely from person to person depending on what sort of lifestyle they want to enjoy during retirement. No financial adviser can do this.

The author sagely suggests that the perhaps the reason why people are so freaked out about retirement is they haven’t really thought about their life goals and as a result, how much money they would require. They may be socking away far too much, or more likely, far too little.

These are good points, but I felt frustrated because this book is directed at a different demographic - the baby boom generation. Many pages are spent inspiring people to question materialism, undo years of workaholic behavior, and find something more meaningful than a new car, a vacation home, and a great bottle of wine.

Yet, mixed in with these suggestions these noble suggestions, there are dire warnings directed towards the really wealthy - no, the ridiculously wealthy, who are enjoying a super-cushy existence at present and expect to maintain it. Eisenberg interviews an independently wealthy businessman who produces a chart, listing the approximate levels of wealth you’ll need to accumulate to sustain a certain lifestyle:

• “Comfortable” :: lives in one place, eats/travels modestly, though better than most, etc. -> $1 - $2 million
• “Comfortable+” :: likes occasional upgrade, mid-priced country club, maybe small second hone, etc -> $2 - $5 million
• “Kind of rich” :: likes finer things, eats/drinks/travels well, gives $ away, picks up checks, couple of nice houses, etc. -> $7 - $10 million
• “Rich” :: spends week / months abroad, exclusive gated golf communities, place for every season, fractional jets, sits on boards, etc. - > $20 million

I’m not sure if Eisenberg’s intent here is to make me say, “Wow, I really planned on riding around in a private jet and own several homes! I’m hopelessly screwed!” Because, my actual reaction is: “That’s great, because I’d be perfectly fine in the ‘comfortable’ category.”

I really have no desire to belong to a country club or any of the other posh materialist stuff on the list. Since many of the trappings of the “uber-rich” are so hopelessly out of reach for me, I’ve essentially given up trying - which sure makes it easier to save for retirement, as my step #1 of the “number” is within grasp.

But in the end, Eisenberg really hopes that every reader put some thought into their life’s purpose, which is admirable. Worrying about money should be an afterthought to defining a fulfilling life. I think he’s saying that instead of obsessing over the “number,” we ought to over what our life’s dreams are, and then figure out how much money we’d need to achieve them.

Note: For a more hands-on, practical financial planning book, I’d recommend any Suze Orman title, Smart Couples Finish Rich, or The Millionare Next Door.

Additional Reading: The Number Website

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