What is a FIRE Number?

A FIRE (Financial Independence, Retire Early) Number is the amount of money you need to have saved and invested to support your desired lifestyle without the need for traditional employment.

This number is based on your annual expenses and a safe withdrawal rate, typically 4% per year, which is considered sustainable for a 30+ year retirement.

How to Use the FIRE Number Calculator？

1. Current Age: Enter your current age in years.

2. Desired Retirement Age: Input the age at which you want to retire.

3. Current Annual Income: Enter your total annual income before taxes.

4. Annual Expenses: Input your current yearly expenses. This should include all living costs, discretionary spending, and any debt payments.

5. Current Savings: Enter the total amount you have currently saved and invested for retirement.

6. Annual Savings Rate: Input the percentage of your income that you save each year.

7. Expected Annual Return Rate: Enter your expected average annual return on investments. A conservative estimate is typically between 5-7% after inflation.

8. Expected Inflation Rate: Input your expected average annual inflation rate. Historically, this has been around 2-3% in the US.

9. Safe Withdrawal Rate: This is pre-set to 4%, based on the widely accepted 4% rule, but you can adjust it if you prefer a more conservative or aggressive approach.

After entering all the required information, click the “Calculate FIRE Number” button. The calculator will then display your results, including:

• Your FIRE Number: The total amount you need to save to achieve financial independence.
• Projected Savings at Retirement: How much you’re expected to have saved by your desired retirement age.
• Years Until Retirement: The number of years left until your planned retirement.
• Annual Expenses at Retirement: Your expected yearly expenses at retirement, adjusted for inflation.

The calculator will also provide a brief analysis of your results, indicating whether you’re on track to meet your FIRE goal or if you need to make adjustments to your savings strategy.

This tool is designed to give you a clear picture of your financial future and help you plan for early retirement. Remember that while it provides valuable insights, it’s based on assumptions and projections. It’s always wise to consult with a financial advisor for personalized advice tailored to your specific situation.