FIRE Calculator - Financial Independence
Calculate how much capital you need to live off your investments (your "FIRE number") and how many years it will take to get there at your current savings rate.
Results
Your FIRE number
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Years to reach it
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Current progress
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Monthly income available once reached
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FIRE number = desired annual expenses · safe withdrawal rate. Years to reach it are calculated by projecting your current savings plus monthly contributions month by month at the given return, until the accumulated capital matches the FIRE number.
Growth projection
When should you use this calculator?
The FIRE movement (Financial Independence, Retire Early) aims to accumulate enough capital to cover living expenses from investment returns alone, without relying on a salary. This calculator estimates how much capital you need and how many years it will take at your current savings rate.
How it is calculated
The FIRE number is calculated by dividing your desired annual expenses by the safe withdrawal rate: FIRE number = annual expenses · withdrawal rate. To calculate how many years it will take to reach it, the calculator projects your current savings month by month, applying the monthly return equivalent to the entered annual return and adding the monthly contribution, until the accumulated capital matches the FIRE number.
Practical example
A numeric example: with €20,000 saved, contributing €500/month at an expected 6% annual return, and wanting to cover €24,000 a year in expenses with a 4% withdrawal rate, the FIRE number is €600,000 (24,000 · 0.04), reached in about 29.5 years at that savings rate. If a more conservative 3.5% rate is used instead, the FIRE number rises to €685,714.29, but the time to reach it only increases to 31.4 years, because compound growth accelerates in the later years of the projection.
Legal and tax context
The 4% rule, popularized by the Trinity Study (1998), analyzes historical U.S. stock and bond portfolios and concludes that withdrawing 4% of the initial capital each year, adjusting that amount for inflation, has historically had a high probability of not running out of money over a 30-year horizon. Some people use more conservative rates, like 3% or 3.5%, precisely for horizons longer than 30 years (a very early retirement) or to reduce risk in unfavourable market scenarios at the start of withdrawals.
The result of this calculator is a purely mathematical projection that assumes a constant annual return, and doesn't explicitly account for inflation, taxes or actual market volatility. Taxation on capital withdrawals varies widely by country of residence and type of investment product, so it's worth checking the rules that apply to your situation. This is not financial advice.
Common mistakes
A common mistake is treating the 4% as a universal rule valid under any circumstances: the original study is based on historical data from specific markets (mainly the U.S.) and a 30-year horizon, not necessarily 40 or 50 years like those sought by people retiring very young. Another frequent mistake is ignoring sequence-of-returns risk: suffering several years of negative returns right as you start withdrawing capital is far more damaging to portfolio sustainability than suffering the same losses later on.
Practical tips
Reaching your FIRE number doesn't require quitting work entirely: many people keep working at something they enjoy once they've reached financial independence, but without depending financially on that income. Variants like "Coast FIRE" (stopping contributions because the capital already accumulated, left to grow, will reach the FIRE number by itself within the desired horizon) or "Barista FIRE" (covering part of expenses with part-time work while the rest comes from investments) offer more flexible ways to approach financial independence than the goal of stopping work all at once.
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Frequently asked questions
What is the 4% rule?
It's a guideline based on historical market data suggesting that withdrawing 4% a year from a diversified portfolio, adjusted for inflation annually, has historically had a high probability of sustaining the capital for at least 30 years.
What is a "FIRE number"?
It's the total capital you need to accumulate so that withdrawing your chosen rate each year covers your annual expenses without working. It's calculated by dividing your annual expenses by the withdrawal rate.
Why use a withdrawal rate other than 4%, like 3% or 3.5%?
A lower rate reduces the risk of running out of money over very long horizons (like a 40-50 year retirement) or in unfavorable market scenarios, at the cost of needing a larger starting capital.
Does this calculator account for inflation?
Not explicitly. It assumes the annual return you enter is already a reasonable long-term estimate; for a more conservative result, you can enter a return net of inflation (a "real" return).
What annual return is realistic to assume?
It depends on your portfolio: a diversified global equity portfolio has historically averaged around 6-8% a year over the long run, though past performance doesn't guarantee future results.
Does financial independence mean I can never work again?
Not necessarily. Many people who reach their FIRE number keep working at something they enjoy, just without financially depending on that income - known as "Coast FIRE" or "Barista FIRE" depending on the approach.
How does choosing a more conservative withdrawal rate affect the time needed?
Although a lower rate (say 3.5% instead of 4%) requires a bigger FIRE number, the extra time needed to reach it is usually smaller than it looks, because compound growth accelerates in the later saving years: in this guide's example, going from 4% to 3.5% only adds about 2 years despite needing €85,714 more capital.
What is sequence-of-returns risk?
It's the risk that the first years after you start withdrawing capital coincide with negative market returns. In that case, a larger share of the portfolio is sold to cover expenses, which can jeopardize long-term sustainability more than if the same losses happened later on.
What is Coast FIRE?
It's the situation where you already have enough capital accumulated that, without contributing anything more and just letting it grow at the expected return, you'll reach your FIRE number by your desired retirement age. From there, you can work just to cover current expenses without needing to keep saving for financial independence.
Is the 4% rule valid outside the United States?
The original study is based on historical U.S. market data. Applying it to other countries or differently composed portfolios is a reasonable but not guaranteed extrapolation; some international analyses suggest somewhat more conservative rates for portfolios not centred on the U.S.