How to use the FIRE calculator
The calculator opens with an example: someone who is 35 years old, with $250,000 invested, saving $30,000 a year and planning to spend $60,000 a year in retirement. Replace the figures with your own.
- Annual spending in retirement. What you expect to spend each year once work stops, in today’s dollars. Start from your current spending, then adjust for things that change: a paid-off mortgage, health insurance you no longer get through work, travel.
- Safe withdrawal rate. The share of the portfolio you plan to take out in the first year. 4% is the familiar starting point; longer retirements call for 3% to 3.5%.
- Current portfolio and annual savings. Count invested money you can draw on: brokerage accounts and retirement accounts. Leave out home equity and your emergency fund.
- Expected real return. The average yearly return after fees and after inflation.
- Current age and take-home pay. Age turns years into a date; pay is optional and only gives your savings rate.
- Lean and Fat FIRE spending. Two alternative budgets, one leaner and one more generous than your regular plan.
The chart shows your portfolio growing year by year, with horizontal lines at the Lean, regular and Fat FIRE numbers. The first table compares the three targets; the second gives the projection year by year.
How the FIRE number is calculated
The target is the portfolio that can pay your spending at your chosen withdrawal rate:
The years to get there come from growing today’s portfolio and adding each year’s savings at the end of the year:
Years to FI: t = ln[(N + S ÷ r) ÷ (P + S ÷ r)] ÷ ln(1 + r)P is the current portfolio, S the annual savings, r the real return and N the FIRE number. The year count is solved as a continuous number, so 18.5 years means halfway through the nineteenth year. With a 0% return, t = (N − P) ÷ S.
A worked example
You plan to spend $60,000 a year and use a 4% withdrawal rate, so your FIRE number is $1,500,000, 25 times your spending.
Your $250,000 is 16.7% of the way there. Saving $30,000 a year from take-home pay of $90,000, a savings rate of 33.3%, and earning a 5% real return, the portfolio reaches the target in 18.5 years, at age 53.5.
The Lean FIRE budget of $40,000 needs $1,000,000 and arrives at age 48.0. Fat FIRE at $120,000 a year needs $3,000,000 and arrives at age 64.6.
Lean, regular and Fat FIRE
FIRE stands for financial independence, retire early. Within the movement, people use a few labels for how much they plan to spend:
- Lean FIRE: independence on a minimal budget, often close to essential costs. It arrives soonest but leaves little room for surprises.
- Regular FIRE: a budget that keeps roughly your current lifestyle.
- Fat FIRE: a generous budget with room for travel, gifts and a margin of safety.
These are community conventions, not definitions. Some people describe Lean FIRE as a certain dollar figure, others as a share of their normal spending. What matters is the shape of the trade-off. Because the FIRE number is proportional to spending, doubling the budget doubles the target, but it does not double the years: the extra money is reached during the years when compounding does the most work. In the example, Fat FIRE needs three times the Lean target and takes 29.6 years instead of 13.0 years.
What moves your FI date most
Holding take-home pay at $90,000, the savings rate changes two inputs at once: more money goes in, and the spending you must replace goes down.
| Savings | Spending | Savings rate | FIRE number | Years to FI |
|---|---|---|---|---|
| $15,000 | $75,000 | 16.7% | $1,875,000 | 28.2 years |
| $30,000 | $60,000 | 33.3% | $1,500,000 | 18.5 years |
| $45,000 | $45,000 | 50.0% | $1,125,000 | 11.6 years |
The withdrawal rate and the return matter too, but each moves only one side of the equation:
| Change from the example | FIRE number | Years to FI |
|---|---|---|
| Withdrawal rate 3% | $2,000,000 | 22.9 years |
| Withdrawal rate 3.5% | $1,714,286 | 20.5 years |
| Real return 3% | $1,500,000 | 23.4 years |
| Real return 7% | $1,500,000 | 15.4 years |
The return is the input you control least. A 7% real return shortens the path, but it is an optimistic long-run figure for a diversified portfolio, so treat it as a best case rather than a plan.
Choosing a withdrawal rate
The 4% guideline comes from research in the 1990s that tested withdrawals against US stock and bond returns since the 1920s. A retiree who took 4% of the starting balance and raised it with inflation each year would have lasted 30 years in nearly every historical period. Early retirement changes two things. The horizon can be 40 to 60 years, and there is no pension or Social Security for the first decades. For those reasons, many people aiming to retire in their 30s or 40s plan with 3% to 3.5%, or keep the flexibility to cut spending after a bad year in the markets.
A lower rate is not free: it adds years of work. Comparing 4% with 3% in the table above shows the price of extra safety in your own numbers.
What this calculator does not include
- Taxes. Withdrawals from pre-tax accounts are taxed as income in the US, and early access before age 59½ has penalties with some exceptions. Enter spending that includes the tax you expect to pay.
- Market swings. The projection uses one steady return. Real portfolios rise and fall, and a crash just after you stop working does more harm than one later. The retirement Monte Carlo calculator tests that risk.
- Other income. Social Security, a pension, rental income or part-time work all reduce the portfolio you need.
- Changing spending. Costs often fall in later life and rise again for health care. A single flat figure is a simplification.
- Rising savings. Pay rises usually let you save more over time; the calculator keeps savings level in today’s dollars.