FIRE Calculator

Frequently Asked Questions

• What is FIRE?

  FIRE stands for Financial Independence, Retire Early. The goal is to save enough that investment returns can cover your annual expenses indefinitely.

• How is the FIRE number calculated?

  FIRE Number = Annual Expenses ÷ Safe Withdrawal Rate (typically 4%). So expenses of $40,000 require a $1,000,000 portfolio. This is the "25× rule".

• What is the 4% rule?

  Based on the Trinity Study, withdrawing 4% of your initial portfolio annually (adjusted for inflation) has historically lasted 30+ years with high success across various market conditions.

• Lean FIRE vs Fat FIRE — what's the difference?

  Lean FIRE is achieving FI on minimal expenses ($25-40K/yr). Fat FIRE is FI on luxury expenses ($100K+/yr) requiring a much larger portfolio (often $2.5M+).

• Is the 4% rule still safe?

  Recent research suggests 3.3-3.5% may be safer for very long retirements (50+ years), and 4% remains reasonable for 30-year horizons. Adjust based on your retirement length and risk tolerance.

• What return rate should I assume?

  Conservative: 5-6% real (after inflation). Historical S&P 500 average: ~7% real. For planning, use 5-7% real and run scenarios at multiple rates.

• Should I include Social Security in my FIRE calculation?

  For early retirees, no — Social Security typically isn't available until 62-67. Including it as a backstop makes traditional retirement easier but doesn't change the FIRE math significantly.

• What about healthcare in early retirement?

  Healthcare is the biggest unknown for early US retirees. Budget $10-20K/year for ACA marketplace plans or consider HSAs and geographic arbitrage to manage costs.

• Coast FIRE vs Barista FIRE — explained?

  Coast FIRE: invested enough that compound growth alone reaches your FI number by traditional retirement age — you can stop saving. Barista FIRE: enough investments + part-time income covers expenses.

• Is FIRE realistic for average earners?

  Yes, but requires aggressive saving (40-70% of income) and patience. Even saving 25% of income consistently from age 25 makes FIRE feasible by mid-50s.