Understanding fire calculator
A FIRE target connects an expense budget with a selected initial withdrawal percentage. A lower percentage requires a larger portfolio. The simulation raises the target with expense inflation, so comparing a future portfolio only with today's uninflated target would make independence appear earlier than this model indicates.
Formula and calculation method
FIRE target today = annual expense / selected withdrawal fraction. Each year, grow the portfolio and add year-end savings, inflate expenses, and compare portfolio with the inflation-adjusted target.
Financial Independence, Retire Early scenario. A user-selected withdrawal rate is not a guaranteed safe rate. Constant returns, constant contributions and deterministic inflation omit market sequence risk, tax, healthcare shocks and uncertain longevity.
How to use fire calculator
- Set Current annual retirement expense budget. The example below uses 600000.
- Set Planned initial withdrawal rate (%). The example below uses 4.
- Set Existing investment portfolio. The example below uses 1000000.
- Set Annual contributions. The example below uses 300000.
- Set Assumed annual portfolio return (%). The example below uses 8.
- Set Assumed annual expense inflation (%). The example below uses 5.
- Set Maximum years to simulate. The example below uses 60.
- Select Calculate to update the result. Reset restores the illustrated inputs. Copy, print or download your own result if you need a record.
Worked example
Example inputs
- Current annual retirement expense budget
- 600000
- Planned initial withdrawal rate (%)
- 4
- Existing investment portfolio
- 1000000
- Annual contributions
- 300000
- Assumed annual portfolio return (%)
- 8
- Assumed annual expense inflation (%)
- 5
- Maximum years to simulate
- 60
- FIRE target today
- 15000000
- Years until modeled target
- 42
- Portfolio at simulation end
- 116,612,538.90087013
- Target at simulation end
- 116,423,813.32676154
Factors affecting your result
Financial Independence, Retire Early scenario. A user-selected withdrawal rate is not a guaranteed safe rate. Constant returns, constant contributions and deterministic inflation omit market sequence risk, tax, healthcare shocks and uncertain longevity.
Changing current annual retirement expense budget changes the scenario being evaluated. Adjust one input at a time when comparing results, keep a copy of the assumptions, and compare values using the same unit and period. A precise arithmetic result does not make an uncertain assumption precise.
Frequently asked questions
How does the fire calculator work?
FIRE target today = annual expense / selected withdrawal fraction. Each year, grow the portfolio and add year-end savings, inflate expenses, and compare portfolio with the inflation-adjusted target.
What inputs does FIRE Calculator need?
Enter current annual retirement expense budget, planned initial withdrawal rate (%), existing investment portfolio, annual contributions, assumed annual portfolio return (%), assumed annual expense inflation (%), maximum years to simulate. Read the unit labels; percentages are entered as ordinary percentages, not decimal fractions.
How should I interpret the fire calculator result?
Financial Independence, Retire Early scenario. A user-selected withdrawal rate is not a guaranteed safe rate. Constant returns, constant contributions and deterministic inflation omit market sequence risk, tax, healthcare shocks and uncertain longevity.
Are my fire calculator inputs uploaded?
No. The calculation runs in this browser. Favorites, recent tool names, theme and formatting preferences may be saved locally, but calculation inputs are not sent to a calculation server or stored by this website. Shared links do not include entered values.
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