Plan for Financial Independence

Disclaimer: This is an estimate based on simplified assumptions. Consult a financial advisor for personalized planning.

Our FIRE Calculator helps you plan for Financial Independence, Retire Early (FIRE) by estimating the savings needed and time to reach your goal. Enter your details to see your FIRE number and savings growth.

How to Use the FIRE Calculator

1. Enter your annual expenses (e.g., $40,000) needed in retirement.
2. Input your current savings (e.g., $100,000).
3. Specify your annual savings (e.g., $20,000) you contribute each year.
4. Enter the expected annual return (e.g., 7%) on investments.
5. Input your safe withdrawal rate (e.g., 4%), typically 3-4%.
6. Click Calculate FIRE to view your FIRE number, years to FIRE, and savings growth chart.

The Logic Behind It

The calculator uses the following logic:
1. FIRE Number = Annual Expenses / Safe Withdrawal Rate (e.g., $40,000 / 0.04 = $1,000,000).
2. Years to FIRE are calculated by simulating savings growth with annual contributions and compound interest until savings reach the FIRE number.
3. Savings growth is modeled using the compound interest formula with annual contributions:
FV = PV × (1 + r)^t + PMT × ((1 + r)^t - 1) / r
Where FV = Future Value, PV = Current Savings, PMT = Annual Savings, r = Annual Return, t = Time in Years.
The chart shows savings growth over time until the FIRE number is reached.

Benefits of Using the FIRE Calculator

• Clarity: Understand the savings needed for financial independence.
• Planning: Estimate how long it will take to retire early.
• Insight: See the impact of savings rate and investment returns.
• Visualization: Track savings progress with a growth chart.