FIRE Calculator

What this calculator answers

How much you need invested to live off your savings (your FI number), and how many years of saving and investment growth it takes to get there. FIRE stands for financial independence, retire early. The FI number comes from two choices you make: what you’ll spend each year and what share of your savings you plan to withdraw. The time depends on what you have now, what you add each year and the return you expect. With your age and a target retirement age, it also works out Coast FI: the amount that would reach your FI number by that age with no more contributions.

Everything is in today’s dollars, so the FI number means the same buying power as your spending does now.

How to use it

• Spending in retirement: what you expect to spend each year once you stop working, at today’s prices, as a yearly or monthly amount. Include the tax you’ll pay on withdrawals and costs your job covers now, such as health insurance. 48,000, $48,000 and 48k all work.
• Withdrawal rate: the share of your savings you plan to take out in the first year, in percent. 4 means 4%. No rate is guaranteed to last; see the 4% rule section below.
• Other income (optional): yearly income that continues after you stop full-time work, such as part-time pay. It lowers the spending your savings must cover.
• Current invested assets: investment and retirement accounts you’ll draw from, not your home or car. Enter 0 if you’re starting out.
• Contributions: what you add to those investments each year or month, including any employer match.
• Raise contributions with inflation: check it if your contributions will grow with prices, as they would with cost-of-living raises. Unchecked, you add the same dollar amount every year.
• Contributions added: at the end or the start of each year. The start is slightly faster, because each deposit grows for one more year.
• Expected annual return and inflation rate: your own long-run estimates, before inflation and after fund fees. The calculator converts them to a return after inflation.
• Current age and target age (optional): the current age adds ages to the results. The target age is the age you want to be able to retire by; with both ages, the results add Coast FI.

Results update as you type. The Try buttons load lean, fat and barista examples and a “stop contributing” case, all worked through below. To weigh plans side by side, press Save for comparison, change an input and save again. Continue in the Retirement Withdrawal Calculator takes your FI number and spending over to see how long the money lasts once withdrawals start.

How to calculate your FIRE number

Divide the yearly spending your savings must cover by your withdrawal rate as a decimal. At 4%, that is 25 times your spending; at 3.5%, 28.57 times; at 3%, 33.33 times.

$$F = \frac{S}{w}$$

• $F$ is the FI number, in today’s dollars.
• $S$ is your yearly spending minus any other yearly income that continues after you stop working.
• $w$ is the withdrawal rate as a decimal (4% is 0.04).

How long until you reach financial independence?

Until the first year-end when your invested balance, growing at your return after inflation plus your contributions, is at least your FI number: 17 years in the worked example below. To find that year, project your savings forward in today’s dollars. First turn your expected return into a return after inflation by dividing, not subtracting:

$$\rho = \frac{1 + r}{1 + f} - 1$$

where $r$ is the expected return and $f$ the inflation rate, both as decimals. If your contributions rise with inflation, each one is worth the same $C$ in today’s dollars, and the number of years $n$ until your assets $A$ grow to $F$ has a closed form, the one a spreadsheet’s NPER function uses:

$$n = \frac{\ln\left(\dfrac{F\rho + C}{A\rho + C}\right)}{\ln(1 + \rho)}$$

With contributions at the start of each year, replace $C$ with $C(1 + \rho)$; with a 0% return after inflation, $n = (F - A) \div C$. Contributions arrive once a year, so the balance first reaches $F$ at the end of year $n$ rounded up, and that whole year is the answer. When your contributions stay at the same dollar amount instead, they buy less each year, there is no single formula, and the calculator finds the year from the year-by-year projection.

Worked example: $4,000 a month of spending, $150,000 invested

You’re 33, expect to spend $4,000 a month and plan on a 4% withdrawal rate. You have $150,000 invested and add $40,000 a year at the end of each year, raised with inflation. You assume a 6.5% return and 2.5% inflation, and you’d like to know about Coast FI by 60.

1. Yearly spending: $4,000 × 12 = $48,000.
2. FI number: $48,000 ÷ 0.04 = $1,200,000.00, 25 times your spending.
3. Return after inflation: 1.065 ÷ 1.025 − 1 = 0.0390244, or 3.90% a year.
4. Years: n = ln(($1,200,000 × 0.0390244 + $40,000) ÷ ($150,000 × 0.0390244 + $40,000)) ÷ ln(1.0390244) = 16.68.
5. Rounded up to whole years, you reach the FI number at the end of year 17, around age 50, with $1,227,555.43 in today’s dollars.

In dollars of that year, the balance is $1,867,870.76 and the FI number has risen with prices to $1,825,941.91. Of the $1,227,555.43, $150,000.00 is what you have today, $680,000.00 is 17 contributions of $40,000 in today’s dollars, and $397,555.43 is growth after inflation.

The 4% rule: where it comes from and its limits for early retirement

The 4% rule comes from studies of past U.S. market returns, not from a formula that guarantees anything. In 1994 William Bengen tested a portfolio half in stocks and half in intermediate-term Treasury notes, starting a retirement in each year from 1926. A first-year withdrawal of 4%, raised with inflation every year after, never ran out in fewer than 33 years. The 1998 study in the AAII Journal, often called the Trinity study, counted how many past payout periods of 15 to 30 years each withdrawal rate survived. It did not adjust for taxes or transaction costs.

Two limits matter for early retirees. Those studies looked at retirements of about 30 years, while someone stopping work at 45 may need their savings for 40 to 50 years. And the future may hold a worse sequence of returns than any in the historical record. A lower rate means a larger FI number and more years of saving; the table under the results shows the trade-off. For the worked example:

Going from 4% to 3% adds $400,000.00 to the target but only 4 years to the wait, because by then growth on a large balance is doing much of the work. None of these rates is a recommendation.

Coast FIRE: how much do you need invested now?

Coast FI is the point where your investments can grow to your FI number by a target age with no more contributions, so from then on you only need to earn what you spend. The coast number is your FI number discounted by the return after inflation over the years left:

$$\text{Coast number} = \frac{F}{(1 + \rho)^{n}}$$

In the example, 60 − 33 = 27 years, so the coast number is $1,200,000 ÷ 1.0390244^27 = $426,860.73. With $150,000 today you’re $276,860.73 short. At $40,000 a year, you pass the coast level after year 9, around age 42, with $633,324.62 in today’s dollars: stop contributing then, and growth alone would reach $1,200,000 by 60. To reach the FI number exactly at 60 instead, you’d need to invest only $16,769.53 a year, rising with inflation.

The Stop contributing button shows the same idea from where you are now: $150,000 alone takes 55 years to grow to $1,200,000 at a 3.90% real return, reaching it around age 88.

Lean, fat and barista FIRE explained

Lean and fat FIRE are not different formulas, just different spending levels, and there is no official line between them. Barista FIRE means covering part of your spending with part-time work, so your savings need to cover less. With the rest of the worked example unchanged:

• Lean FIRE, $30,000 a year: FI number $750,000.00, reached in 11 years, around age 44.
• Fat FIRE, $120,000 a year: FI number $3,000,000.00, reached in 33 years, around age 66. Reaching it by 60 would take $55,552.15 a year instead of $40,000.
• Barista FIRE with $20,000 of part-time pay: your savings cover $48,000 − $20,000 = $28,000 a year, so the FI number is $700,000.00, reached in 11 years (NPER gives 10.03, just past 10).

Barista FIRE only works while that income lasts; if the part-time work might stop, check the full FI number too.

Why this calculator works in today’s dollars

Prices rise, so a dollar amount 20 years from now buys less than it does today. A projection in future dollars makes every number look larger and is hard to compare with your spending now. This calculator does the whole projection in today’s dollars, using the return after inflation, and shows the future-dollar figures next to them.

Use division for the return after inflation. In the example, 6.5% − 2.5% = 4%, but the exact figure is 1.065 ÷ 1.025 − 1 = 3.90%. The gap is small in one year and adds up over decades.

Reading the result

• Your FI number is the target in today’s dollars, with how many times your spending it is and when you reach it.
• Years to FI counts whole years to the first year-end when your balance is at least the FI number. If you’ve already reached it, the calculator says so and shows the spending your assets support; if the balance doesn’t get there within 100 years, it says why and how much spending the plan would support.
• Balance then is the balance at that year-end in today’s dollars, then in dollars of that year next to the FI number in the same dollars.
• Coast FI (with both ages) shows the coast number, the year you pass it at your current contributions, and the contributions that reach the FI number exactly at your target age.
• The year-by-year projection lists each year’s contribution, growth and balance in dollars of that year, the balance in today’s dollars, the FI number in that year’s dollars and your progress toward it. In the example, year 1 is $150,000 × 1.065 + $41,000 = $200,750.00, which is $195,853.66 in today’s dollars. Download the whole projection as a CSV file.
• The chart draws your balance against the FI number, both in today’s dollars. Where your balance at FI comes from splits the final balance into what you have now, your contributions and growth.
• FI number and years at other withdrawal rates and Years to FI at other returns repeat the calculation with one input changed. In the example, a return 2 points lower (4.5%) stretches 17 years to 21.

What this FIRE calculator leaves out

• Varying returns. The projection uses one return every year. Real markets swing, and a run of poor years just after you stop working does more damage than the same years later (sequence-of-returns risk).
• Taxes. Nothing is taxed here. Withdrawals from traditional retirement accounts are usually taxable, and taking money from a 401(k) or IRA before age 59½ generally adds a 10% additional tax unless an exception applies. Include the tax in your spending, and plan which accounts pay for the years before 59½.
• Social Security and pensions. Income that starts later isn’t modeled. Social Security retirement benefits can’t start before age 62.
• Fees. Enter your return after fund and advisory fees. The fee comes off the return every year, and the gap compounds.
• Changes in spending. Spending is assumed to stay level in today’s dollars. Health insurance before Medicare, children and housing can move it a lot.
• Home equity and other assets you won’t sell. Only invested assets count.

The result is an educational estimate, not financial, tax or investment advice.

Common mistakes

• Using income instead of spending. The FI number depends on what you spend, not what you earn. Someone earning $120,000 and spending $48,000 needs $1,200,000 at 4%, not $3,000,000.
• Typing monthly spending as yearly. $4,000 entered as a yearly amount gives an FI number of $100,000. Choose Monthly, or multiply by 12.
• Taking inflation off twice. If your expected return is already after inflation, set inflation to 0%.
• Leaving out taxes on withdrawals. If you expect 15% of each withdrawal from a traditional account to go to tax, spending $48,000 means withdrawing $48,000 ÷ 0.85 = $56,470.59.
• Treating 4% as safe for any length of retirement. It comes from historical tests of about 30 years; a 50-year retirement is a different question.
• Counting Social Security from the first year. For an early retiree it may be decades away; leave it out of other income.