FIRE Calculator
The portfolio that supports your expenses indefinitely, and how long it takes to build. The savings rate matters far more than the return, which is the finding that makes the whole idea work.
Also called: financial independence calculator, 25x rule, retire early.
13.6 years to a $22,500,000.00 portfolio at a 4% withdrawal rate. Your savings rate of 50% is what drives that, far more than the return.
An estimate, not an offer or a guarantee. Projected returns assume the rate you entered holds for the whole term, which no market does.
This is what the calculation gives for the numbers you entered. It is an estimate, not advice, and it knows nothing about your situation beyond those numbers. Rules for United States change on a published schedule; the effective date is shown on every rule-based tool.
How this is calculated
The target is annual expenses divided by the withdrawal rate, so a four percent rate means twenty-five times expenses. Everything then depends on the savings rate rather than the return, because saving more does two things at once: it adds to the portfolio and it lowers the expenses the portfolio has to cover. That double effect is why someone saving half their income reaches independence in under two decades at any plausible return.
the target is expenses divided by the withdrawal rate; the years follow from compounding the portfolio and savings up to it- E
- Annual expenses (currency)
- w
- Withdrawal rate (decimal)
- S
- Annual savings (currency)
- r
- Real return (decimal)
Method and limits
What it assumes
- Returns are entered net of inflation, so the answer is in today’s money.
- Expenses in retirement match expenses now.
What it deliberately does not model
- The four percent rule comes from US market history over thirty-year retirements. A longer retirement or a different market is a different question.
- It ignores tax, healthcare and the possibility of earning anything after stopping.
- Sequence of returns risk is not modelled and is the main way this fails in practice.
Formula version 1.0.0 · definition 1.0.0 · United States · Report a problem with this calculator
Frequently asked questions
- Why does the savings rate matter more than the return?
- Because it works on both sides. Saving more grows the portfolio and shrinks the expenses it must cover, so it moves the target and the progress towards it at the same time.
- Is four percent safe?
- It came from US data on thirty-year retirements and is a rule of thumb rather than a guarantee. For a retirement of forty years or more, or outside that market, a lower rate is the cautious choice.