Estimate your financial independence number and how many years of work stand between you and freedom.
The FIRE number is the portfolio size at which withdrawals can cover your living costs indefinitely. It is built from two inputs and one multiplication: annual spending divided by a withdrawal rate. At $40,000 of annual expenses and a 4% withdrawal rate the number is $1,000,000, and 4% of $1,000,000 is $40,000, which is the whole point. The portfolio does not need to be touched beyond that slice, so the principal keeps working.
Notice what the number is not. It is not a net worth figure, it is not a savings target, and it has nothing to do with income. Someone earning $200,000 and spending $120,000 has a much larger FIRE number than someone earning $70,000 and spending $35,000, and the second person gets there first almost every time.
The 4% rule comes out of US market history. William Bengen's 1994 paper tested rolling 30-year retirement periods from 1926 onward and found that a 4% initial withdrawal, adjusted for inflation each year, survived every one of them in a portfolio split between stocks and intermediate government bonds. The Trinity study, published in 1998 by three professors at Trinity University, reached a similar conclusion across a grid of stock allocations and horizons. The 25x multiple is simply the reciprocal of 4%.
Three assumptions hide inside that history, and they matter. The horizon is 30 years, which fits a retiree at 65 and fits poorly someone leaving work at 40. The markets are US markets, which had an unusually good century. And the withdrawal is a fixed real amount, so the plan fails in the year you run out rather than degrading gradually. Raise the horizon to 50 years and the sustainable rate drifts down toward 3.5%. That is why the withdrawal rate field in this calculator is the first thing to touch, not the last.
Expenses are annual spending in today's dollars, gross of taxes you will still owe. The withdrawal rate is the share of the portfolio you plan to spend each year, expressed as a decimal. Monthly savings is what actually leaves your paycheck for investments, including any employer match. The expected return is a nominal figure applied monthly, which is the first place this model flatters itself, as the last section explains.
$40,000 of annual spending at a 4% withdrawal rate gives a target of $1,000,000. Starting from $50,000 invested and adding $2,000 a month at a 7% nominal return, the balance crosses the target in month 212, or 17.7 years. You will have contributed $424,000 of the total. Investment growth supplies the other $526,000, so slightly more than half the portfolio comes from returns rather than from your own deposits.
That split is the entire case for starting early. Contributing $424,000 over 212 months works out to $2,000 a month for roughly eighteen years, which is a demanding savings rate for most households. Stretch the timeline to 35 years and the required deposit falls to about $223 a month, roughly a ninth of it, because the growth has twice as long to do the work.
Reducing annual spending lowers the FIRE number, because the target is a multiple of spending. It also frees cash to invest, which raises the monthly deposit. No other lever in this model works on both sides at once.
| Annual spending | FIRE number at 4% | Years at $2,000/mo | Total contributed |
|---|---|---|---|
| $30,000 | $750,000 | 14.7 | $352,000 |
| $40,000 | $1,000,000 | 17.7 | $424,000 |
| $50,000 | $1,250,000 | 20.1 | $482,000 |
| $60,000 | $1,500,000 | 22.2 | $532,000 |
| $80,000 | $2,000,000 | 25.7 | $616,000 |
Each $10,000 of annual spending costs about $250,000 of portfolio and, at a fixed deposit, roughly two to three years. The table also understates the effect, because it holds the deposit constant. Rerun the default case with spending cut to $30,000 and the freed cash invested, which means a deposit of $2,833 a month, and the date moves from 17.7 years to 12.0. Of those 5.7 years, 3.0 come from the smaller target and 2.7 come from the larger deposit.
| Withdrawal rate | Multiple of spending | FIRE number | Years at $2,000/mo |
|---|---|---|---|
| 3.0% | 33.3x | $1,333,333 | 20.8 |
| 3.5% | 28.6x | $1,142,857 | 19.1 |
| 4.0% | 25.0x | $1,000,000 | 17.7 |
| 4.5% | 22.2x | $888,889 | 16.4 |
| 5.0% | 20.0x | $800,000 | 15.3 |
Dropping from 4% to 3% adds $333,333 to the target and three years to the schedule. The trade is real in both directions: 5% gets you out sooner and raises the chance you go back to work in your seventies, and 3% buys margin that most people never need. A reasonable default for a 30-year retirement is 4%. For a 50-year retirement, or for anyone who wants the portfolio to survive a bad first decade, use 3.5% and accept the extra years.
Two tables, same target, one variable changed at a time.
| Monthly deposit | Years to FIRE |
|---|---|
| $1,000 | 23.9 |
| $1,500 | 20.2 |
| $2,000 | 17.7 |
| $2,500 | 15.8 |
| $3,000 | 14.2 |
| $4,000 | 11.9 |
| Expected nominal return | Years to FIRE |
|---|---|
| 4% | 22.6 |
| 5% | 20.6 |
| 6% | 19.0 |
| 7% | 17.7 |
| 8% | 16.5 |
| 9% | 15.5 |
An extra $500 a month saves 1.9 years. An extra percentage point of return saves 1.2 years. The deposit wins, and the deposit is the variable you can actually decide. Chasing 9% to shave two years is a bad trade, because the portfolios that produce 9% averages also produce 30% drawdowns, and a drawdown in the first five years of a FIRE plan is the one thing that breaks it.
This model applies a smooth 7% every month. Real portfolios do not do that. Two retirees with identical average returns can end up in completely different places depending on the order the returns arrive, and the one who hits a bear market in the first three years of withdrawals is the one who runs out. That is the argument for a cash buffer of one to three years of spending at the start of retirement, and for treating the first three years of withdrawal as the most fragile part of the plan.
The calculator also assumes you stop saving at the moment the balance crosses the line. Many people do not stop, they downshift, which pushes the date earlier and makes the plan more robust at the same time.
Taxes on withdrawals. Traditional 401(k) and IRA balances are taxed as ordinary income when they come out, so a $1,000,000 traditional balance does not fund $40,000 of spending at a 4% rate. At a 22% effective rate you need roughly $1,280,000 in a traditional account to match $1,000,000 in a Roth, and the Roth versus traditional IRA calculator prices that gap for your bracket.
Healthcare before Medicare. Retiring at 45 means a decade or more of insurance bought at full price, and for many early retirees that line item is $8,000 to $15,000 a year on its own. It belongs in the expenses field, not in a footnote.
Social Security. Anyone retiring at 62 or later will receive something, which lowers the portfolio needed. Leaving it at zero is the conservative choice, and it is the right one for a plan built to survive bad luck.
Inflation. The calculator grows the portfolio at a nominal 7% while holding expenses at today's dollars, which quietly assumes the 7% is a real return after inflation. If your 7% is nominal and inflation runs 3%, the real growth rate is closer to 4%, and the honest years-to-FIRE figure is the one in the 4% row of the return table. Use that row if you want the pessimistic, more defensible answer.
FIRE is a horizon problem, so the tools that matter are the ones that measure horizons. The retirement withdrawal calculator takes the other side of the question and asks how long a given balance lasts once you start spending it. The savings goal calculator handles the intermediate targets that sit between now and the finish line, and the compound interest calculator shows what the same deposit does over 40 years without a withdrawal rate attached. The retirement withdrawal guide goes further into sequence risk, the part a single withdrawal rate cannot show you.
For a 30-year retirement funded from a diversified US portfolio, historical data says yes with high probability, and the failures cluster in periods that started with expensive valuations. For a longer retirement or a retiree who cannot tolerate a bad outcome, 30 to 33 times expenses is the safer target. The multiple is a shorthand for a probability, so the honest answer is that it depends on the horizon and on how much margin you want.
Leaving it out produces a larger target and a more conservative plan. Including it is reasonable if you are within ten years of claiming and your earnings record is stable, in which case subtract the expected annual benefit from expenses before dividing. A middle path is to count 75% of the projected benefit, which is roughly the share the trust fund is projected to cover if nothing changes.
A nominal 7% for a mostly equity portfolio is a common planning figure and matches long-run US stock returns before inflation. After 3% inflation that is about 4% real. If you want a number that survives bad luck, model 5% nominal and see whether you can live with the resulting date. If the plan only works at 9%, the plan is a hope.
Most differences come from three choices: whether healthcare is in expenses, whether taxes are grossed up, and whether the withdrawal rate is 4% or 3.5%. A calculator showing a much larger number is usually including health insurance before Medicare and grossing up for taxes. Neither approach is wrong, and the one that fits your situation is the one whose assumptions you can see.
Yes, as long as the payment is in the expenses field and the balance is in the portfolio math. A paid-off house lowers the target twice, once by removing the payment from expenses and once by removing the risk that the payment rises with rates. Paying off a mortgage early is a guaranteed return equal to the mortgage rate, which is a reasonable alternative to holding bonds in the same portfolio.
That is sequence risk, and it is the main reason plans fail even when the average return is fine. The standard defenses are a cash or short bond buffer covering one to three years of spending, flexibility to cut discretionary spending in a bad year, and a slightly lower withdrawal rate at the start. None of them require forecasting, which is why they work.
Contribution limits and plan rules for the current tax year on every page.