FIRE Calculator
Plan your journey to Financial Independence and Early Retirement. Calculate your FIRE number, see your projected savings, and find out if you are on track to meet your goals.
Your FIRE Number
£750,000
The total savings you need to retire.
Years to FIRE
22
Based on your current plan.
Projected Portfolio at Age 50
£722,864
Understanding Your FIRE Journey
The path to financial independence is a marathon, not a sprint. This calculator provides a snapshot based on your inputs, but the journey involves consistent strategy and discipline. Here’s a breakdown of the key concepts.
What is Your FIRE Number?
Your FIRE number is the cornerstone of your plan. It represents the total capital you need to accumulate for your investments to generate enough income to cover your living costs indefinitely. It is calculated based on your desired annual spending in retirement and a "safe withdrawal rate". For example, if you need £40,000 a year and use a 4% withdrawal rate, your FIRE number is £1,000,000.
The 4% Safe Withdrawal Rate (SWR)
The 4% rule is a popular guideline originating from the Trinity Study. It suggests that if you withdraw 4% of your portfolio's initial value each year, adjusting for inflation, your funds have a very high probability of lasting for at least 30 years. While it's a solid starting point, it's important to understand its limitations. It's based on historical US market data and doesn't guarantee future outcomes. Some people opt for a more conservative 3.0% or 3.5% rate for added security.
Strategies to Reach FIRE Faster
There are two main levers you can pull to accelerate your journey: increase your savings rate or increase your investment returns. Increasing your savings rate, by either earning more or spending less, has the most significant impact. Every pound you don't spend is a pound that can be invested to work for you. Maximising tax-efficient accounts like ISAs and pensions is crucial. For information on pensions, visit the official GOV.UK pensions website. You can also compare different savings options with our savings comparison calculator.
Frequently Asked Questions
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