Financial Independence, Retire Early. The math is surprisingly simple: your savings rate decides everything. Run your numbers and see when you can walk away from required work.
All numbers are in today's dollars — your return rate should be real (inflation-adjusted), and spending is assumed constant. Growth follows the end-of-year formula balance × (1 + return) + annual savings. FIRE number uses your withdrawal rate (4% → 25× spending). Tiers assume steady returns and don't model sequence-of-returns risk or healthcare costs pre-65. For a full Monte Carlo simulation, see FIRECalc or cFIREsim.
Not your salary. Not your investment picks. Not luck. The one number that decides when you can stop working is the share of your take-home pay you keep. Here's what that looks like, starting from zero.
Pile up enough in your 20s and 30s that compound interest alone gets you to a traditional retirement at 65 — no further contributions needed. You can drop to a lower-stress job or support a family on one income.
Retire with a smaller number by committing to a lean lifestyle — often $30k–$50k/year. Works best for people who genuinely enjoy simplicity: van life, low cost-of-living towns, homesteading.
The classic goal: 25× your current annual spending. Withdraw 4% per year and your portfolio is statistically expected to last 30+ years, even through recessions. The Bengen rule in action.
Retire with room for travel, gifts, a nicer home, and the occasional splurge. Usually means a target of $2.5M–$5M+ and often requires high income plus high savings rate for 15–20 years.
FIRE isn't about quitting at 35. It's about having the option. Once your portfolio covers your bills, work becomes a choice — whether you keep going for purpose, downshift to something meaningful, or walk away entirely.
In 1994, financial planner William Bengen analyzed every 30-year retirement window in US market history and found that retirees who withdrew 4% of their starting portfolio each year — adjusted for inflation — never ran out of money. Not even those who retired in 1929 or 1966. Flip that math around and you get the FIRE equation: whatever you spend annually, you need 25× that amount invested to be done for life.
Modern research suggests 3.5–4% is still a solid starting range for early retirees (who face longer horizons than traditional retirees). Variable withdrawal strategies can push this higher in good years.