How to Calculate Your FIRE Number

Your FIRE number is 25× your annual expenses. Spend $60,000 a year? Your number is $1.5 million. Here's where the 25× comes from, the variants that fit real life, and what the rule doesn't tell you.

The 25× rule and the 4% rule behind it

The 4% rule comes from the 1998 Trinity Study: a portfolio of roughly 50–75% stocks, withdrawing 4% in year one and adjusting for inflation each year after, survived every 30-year window in the historical data. 25× inverts it: save 25 years of spending, and 4% of that covers one year of spending indefinitely — in theory.

Worked example

Notice the input is spending, not income. Cutting $10,000/year of spending lowers your number by $250,000 — frugality moves the goalpost twice, once by letting you save more and once by shrinking the target.

The FIRE variants

Coast FIRE — the early win

You have enough invested now that compounding alone reaches your full number by 65, with zero further contributions. Example: $200,000 at age 30, growing at 7% real, becomes ~$2.1M by 65 — Coast FIRE achieved. You still work, but only to cover current expenses; retirement savings are done.

Barista FIRE — the halfway house

Quit full-time work with a portfolio covering most expenses, plus part-time work for the gap — often specifically for health insurance, the biggest pre-Medicare cost in the U.S. A $1M portfolio plus $20k/year of part-time income can replace a $1.5M full-FIRE number.

Lean FIRE / Fat FIRE

Lean FIRE targets a minimalist number (often under $1M) via low spending. Fat FIRE keeps a high-spending lifestyle and targets $2.5M+. Same math, different spending input.

What the 25× rule misses

• 30 years ≠ 50 years. The Trinity Study tested 30-year retirements. Retiring at 40 means funding 50+ years — many planners suggest 3–3.5% (28–33×) for very early retirement.
• Sequence-of-returns risk. A market crash in your first years of retirement hurts far more than one later. Flexible spending (cutting back in down years) massively improves survival odds.
• Healthcare. Before Medicare at 65, insurance is often the largest budget line — and the least predictable.
• Taxes and fees. The 4% is gross; taxes and fund fees come out of it. Low-cost index funds keep more of it.
• It's based on U.S. history. Past returns don't guarantee future ones, especially starting from high valuations.

Estimating your timeline

Your savings rate dominates everything. Rough years-to-FI at 7% real returns, starting from zero:

Frequently asked questions

What is a FIRE number?

25 times your annual expenses — the portfolio size the 4% rule says can sustain your spending indefinitely.

Is the 4% rule still safe?

It's a reasonable starting point. For retirements much longer than 30 years, 3.5% (about 28×) is the more conservative modern guideline.

What is Coast FIRE?

Having enough invested early that growth alone reaches your full FIRE number by traditional retirement age — no more contributions needed.

Does the FIRE number use gross or net spending?

Actual spending including taxes you'll owe in retirement. Most people estimate from current spending, adjusted for paid-off housing and added healthcare.

Can I FIRE with kids?

Yes — the math is the same, but the spending input is higher and less flexible, so the number grows. Many parents target Barista or Coast FIRE instead.

Educational content, not financial advice. Withdrawal research evolves — treat any rule of thumb as a planning starting point, not a guarantee.