What's a good FIRE number? (and how to actually calculate yours)
How to calculate your FIRE number using the 4% rule, what counts as a realistic target by income, and the trap of over-estimating expenses.
1 May 2026
The standard FIRE number is your annual expenses × 25 — the size of investment portfolio that lets you withdraw 4% per year indefinitely without running out of money. It comes from the Trinity Study, which found that across most 30-year periods in US market history, a 4% inflation-adjusted withdrawal rate has lasted at least 30 years.
The full picture is more nuanced. Here is how to think about your number realistically.
Step 1: get your real annual expenses
Most people underestimate their expenses by 20-40% because they forget non-monthly costs. Your real annual expenses include:
- Housing (rent or mortgage + property tax + insurance + maintenance)
- Utilities and services
- Food (groceries + eating out, including coffees and snacks)
- Transport (car payment + insurance + fuel + repairs OR transit + rideshare)
- Healthcare (premiums + out-of-pocket — important if employer-provided now)
- Subscriptions and memberships
- Annual costs you forget (car registration, holiday spending, gifts, taxes on unsheltered investments)
- Discretionary buffer (travel, hobbies, things)
Total it all. That number times 25 is your headline FIRE number.
Step 2: the 25× rule, refined
The 4% rule was based on a 30-year retirement. If you plan to retire at 35 with a 50+ year horizon, the safe withdrawal rate drops:
- 4% (×25): safe for ~30-year retirements (traditional)
- 3.5% (×28.5): safer for 40-year retirements
- 3% (×33): conservative; closer to "perpetual" withdrawal
If you are 30 today and want to retire at 40, use 3.5% (multiply expenses by 28.5) at minimum. If you are 30 and want to retire at 50 with a 30-year retirement, 4% is fine.
Step 3: examples
| Annual expenses | 4% rule (×25) | 3.5% rule (×28.5) |
|---|---|---|
| $30,000 | $750,000 | $857,000 |
| $50,000 | $1.25 million | $1.43 million |
| $80,000 | $2 million | $2.28 million |
| $120,000 | $3 million | $3.42 million |
Step 4: the variable that actually matters — savings rate
The single most important number is not your FIRE target — it is your savings rate (the percentage of after-tax income you save and invest). Mr Money Mustache's canonical table:
- 10% savings rate: 51 years to FI
- 20%: 37 years
- 30%: 28 years
- 50%: 17 years
- 70%: 9 years
This is independent of income. Two people earning $60k and $200k both retire at the same time if they save the same percentage — because the high earner has higher expenses to replace, requiring a bigger nest egg. Income matters; savings rate matters more.
The trap: lifestyle inflation defeats high incomes
The most common mistake high earners make is letting expenses scale with income. A $200k earner spending $180k will need $4.5M to retire. A $60k earner spending $40k will need $1M. The high earner is not closer to FI — they are further from it because their FIRE number is 4.5× larger.
If you want to actually run your numbers (assets, expenses, projected FI date with adjustable return assumptions), the free FIRE calculator does the full simulation.
Put this into practice
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