Question 1

What is a FIRE number?

Accepted Answer

Your FIRE number is the amount of savings and investments you need to cover your annual expenses indefinitely using a safe withdrawal rate. It is typically calculated as your annual expenses divided by your safe withdrawal rate (e.g. $45,000 / 0.04 = $1,125,000).

Question 2

What is the 4% rule for FIRE?

Accepted Answer

The 4% rule suggests you can withdraw 4% of your portfolio in the first year of retirement and adjust for inflation each year after, with a high probability of your money lasting at least 30 years. It is based on the Trinity Study and is the most common safe withdrawal rate used in FIRE planning.

Question 3

How do I calculate my savings rate for FIRE?

Accepted Answer

Your savings rate is the percentage of your gross income that you save and invest. It is calculated as (Annual Income - Annual Expenses) / Annual Income. A higher savings rate dramatically reduces the number of years needed to reach financial independence.

FIRE Calculator

Assumptions

FIRE Number

FIRE Date / Age

Savings Rate

Savings Growth vs FIRE Target

Year-by-Year Projection