FIRE Calculator

How do I calculate my FIRE number?

Your FIRE (Financial Independence, Retire Early) number is the total investment portfolio size you need to sustain your lifestyle indefinitely without having to work for active income. The calculation relies heavily on the Safe Withdrawal Rate (SWR), often known as the "4% Rule" derived from the Trinity Study.

Mathematical Formula

FIRE Number = Target Annual Expenses ÷ Safe Withdrawal Rate

Developer Snippet: Programmatic FIRE Calculation

If you are building a financial app, you can copy-paste this JavaScript utility function to calculate the core FIRE metrics:

function calculateFireMetrics(targetExpenses, withdrawalRatePct, currentSavings, annualSavings, realReturnPct) {
  const fireNumber = targetExpenses / (withdrawalRatePct / 100);
  // Calculate years to FIRE using compound interest formula
  const yearsToFire = Math.log((fireNumber + (annualSavings / (realReturnPct/100))) / (currentSavings + (annualSavings / (realReturnPct/100)))) / Math.log(1 + (realReturnPct/100));
  
  return {
    targetCorpus: fireNumber,
    yearsRequired: Math.max(0, yearsToFire)
  };
}

How Inflation Impacts Your FIRE Number

Premise: Many retirement planners use aggressive 8-10% stock market returns to calculate their portfolio growth, completely ignoring the fact that inflation devalues their purchasing power over the same 30-year timeframe.

Evidence: If your portfolio grows at 8% per year, but inflation averages 3% per year, your true "real" gain in purchasing power is only 5%. Failing to adjust for this means a $1,000,000 portfolio in 30 years will only buy the equivalent of what $411,000 buys today.

Conclusion: Therefore, the most accurate way to model FIRE is to deduct your expected inflation rate from your expected market return. This "Real Return" calculation ensures your target FIRE number remains anchored in today's purchasing power, providing a realistic goal.

Why Basic Calculators Fall Short

• Static Expenses: Basic tools assume your current expenses will perfectly match your retirement expenses. In reality, commuting costs drop, while healthcare or travel may rise. You must set a dedicated "Target Retirement Expense".
• Rigid 4% Rules: As life expectancies rise, many in the FIRE community prefer a conservative 3.25% or 3.5% Safe Withdrawal Rate over the traditional 4%.

Frequently Asked Questions