FIRE Number Calculator
The nest egg you need to retire on the 4% safe-withdrawal rule.
Input sheet
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FIRE — Financial Independence, Retire Early — hinges on one figure: the nest egg that lets you live off withdrawals indefinitely. This computes that target from your annual spending and chosen withdrawal rate.
How it works
FIRE number = annual spending ÷ withdrawal rate. At a 4% rate that equals 25 times your yearly spending.
The idea is that a portfolio can sustain withdrawals if you take out only a small, fixed percentage each year. Divide your annual spending by that rate and you get the principal needed to generate it. At the classic 4% rate, that works out to 25 times your yearly spending.
The withdrawal rate is the key dial. A lower rate (say 3.5%) demands a bigger portfolio but is safer over long retirements; a higher rate needs less savings but carries more risk of running out.
FIRE number = annual spending ÷ (withdrawal rate ÷ 100). At a 4% withdrawal rate this equals 25 × annual spending; the multiple of spending is 1 ÷ withdrawal rate.
Worked examples
$50,000 annual spending at a 4% withdrawal rate. → $1,250,000 FIRE number — 25× annual spending.
$50,000 ÷ 0.04 = $1,250,000. That portfolio, drawn at 4% a year, is designed to fund $50,000 of spending while the balance has historically survived 30+ years.
Tips & gotchas
- Estimate your real post-retirement spending, not your current income. Many costs (commuting, mortgage, raising kids) change in retirement, up or down.
- A lower withdrawal rate is the simplest way to add safety margin — many planners use 3.25-3.5% for retirements expected to last well beyond 30 years.
- The FIRE number is in today's dollars. If you are decades out, inflate your spending estimate so the target reflects future prices.
- Healthcare and long-term care are the wild cards in early retirement — pad your spending figure to account for coverage you may have to buy yourself.
FAQ
Is 4% safe?
It is a historical guideline, not a guarantee. Many planners use 3.25–3.5% for longer retirements.
Where does the 4% rule come from?
It traces to research showing a portfolio withdrawing 4% in year one, adjusted for inflation after, historically lasted at least 30 years across U.S. market history. It is a guideline, not a guarantee.
Does this account for Social Security or a pension?
No. If you expect guaranteed income, subtract it from your annual spending before entering the figure, so the FIRE number covers only what your portfolio must fund.
What is the difference between lean, regular, and fat FIRE?
They are just different spending levels plugged into the same math — lower annual spending yields a smaller FIRE number (lean), higher spending a larger one (fat). The formula does not change.
How much do I need to save each year to reach it?
That depends on your timeline and return assumptions — pair this target with the Future Value Calculator to see what monthly contribution and growth rate reach the number in your desired timeframe.
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