The formula
FIRE number = annual spending ÷ safe withdrawal rate. At 4% that is 25 times your annual spending; at 3.5% about 28.6 times. To find when you get there, the calculator grows your net worth at the real return — (1 + nominal return) ÷ (1 + inflation) − 1 — and adds your monthly savings until the target is reached. Because everything is in today's money, the FIRE number means "this much in today's dollars". In retirement it withdraws your annual spending each year and checks whether the balance survives 60 years.
Using the 4% rule
The 4% rule comes from historical studies of 30-year withdrawals from US stock and bond portfolios. If you expect a retirement longer than 30 years, or want a margin against a bad market early in retirement, try 3–3.5%. Lean FIRE (70% of spending) is a frugal target; Fat FIRE (150%) leaves room for travel and surprises. Try raising savings a little versus trimming spending a little and see which moves your FIRE age more.
What it leaves out
Returns are assumed constant; real markets are volatile, and the order of returns matters. Social Security or other pensions, taxes, health insurance before Medicare and rising medical costs are not modelled — subtract expected pension income from your spending to approximate it. Treat results as a planning estimate.
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