FIRE

Calculating Your FIRE Number

Your FIRE number is the invested balance at which a safe annual withdrawal covers your living expenses forever, letting you stop relying on a paycheck. Using the widely-cited “4% rule,” your FIRE number is simply your annual expenses divided by your withdrawal rate — 25 times your annual expenses at the standard 4%. Enter your expenses, current savings, monthly contribution, and expected return, and this calculator finds both your FIRE number and how many years it will take to reach it.

This is separate from projecting a balance to a chosen retirement age — see the

Retirement / 401(k) Savings Calculator for that.

The Formula

$$\text{FIRE Number} = \frac{\text{Annual Expenses}}{\text{Withdrawal Rate}}$$

The years to reach it are solved from the standard future-value-of-a-growing-savings- balance formula, given your current savings, monthly contribution, and expected return:

$$\text{FIRE Number} = \text{Current Savings} \times (1 + r)^n + \text{Monthly Contribution} \times \frac{(1 + r)^n - 1}{r}$$

Worked Example

$40,000 in annual expenses, $50,000 in current savings, contributing $2,000 per month, with a 7% expected annual return and the standard 4% withdrawal rate:

1. FIRE number: $40,000 \div 0.04 = 1,000,000$.
2. Solving the growth equation for the number of months to reach $1,000,000 gives approximately 211 months.
3. Years to FIRE: $211 \div 12 \approx 17.6$.

Key Factors to Consider

• Sequence-of-returns risk is a real concern the 4% rule doesn’t fully address for every retiree. A market downturn in the first few years after reaching FIRE can be far more damaging to a portfolio’s long-term survival than the same downturn happening later, since withdrawals during a down market lock in losses — this is why some planners build in extra flexibility (adjusting spending in a bad year) rather than treating withdrawals as perfectly fixed.
• Healthcare costs before Medicare eligibility are a common, often underestimated expense for early retirees in the U.S. Someone reaching FIRE well before age 65 needs to budget for self-funded health insurance, which can be a substantial and rising annual expense not always fully accounted for in an “annual expenses” figure based on current, employer-covered costs.
• A FIRE number based on today’s expenses should account for how spending might change in retirement. Some early retirees spend more in the early, active years of retirement and less later, while others see costs rise with age-related healthcare needs — the FIRE number here assumes a constant real expense level throughout.
• “Lean FIRE,” “Fat FIRE,” and other variations describe different target lifestyles, not different math. These terms describe a lower or higher annual-expense assumption feeding into the same 25x formula — the underlying calculation doesn’t change, only the expense figure a person plugs into it.

Common Mistakes

• Confusing this with a traditional retirement projection. This calculator solves for the target balance itself and the time to reach it — for projecting a balance forward to a fixed retirement age instead, use the Retirement / 401(k) Savings Calculator.
• Treating the 4% rule as guaranteed. It’s a widely-cited historical planning heuristic (most famously the “Trinity Study”), not a guarantee — some planners use a more conservative 3.5% for a retirement expected to last many decades.
• Basing the FIRE number on current income instead of expected expenses. What matters for the calculation is how much you’ll actually spend once financially independent, not how much you currently earn.

Useful to Know

• A small change to the expected annual return has an outsized effect on the years-to-FIRE figure, since it compounds every month between now and reaching your number — worth running this calculator with a couple of more conservative return assumptions to see how sensitive your own timeline really is.
• “Coast FIRE” is a related but distinct milestone: the point at which your current savings alone, left to grow untouched, will reach your FIRE number by a traditional retirement age even if you stop contributing — see the Coast FIRE Calculator if that’s closer to your actual plan than saving all the way to full FIRE.
• This calculator pairs naturally with the Savings Rate Calculator (since your savings rate is the main lever you control for shortening the years-to-FIRE figure) and the Net Worth Calculator (for tracking your actual progress toward the number over time).