The 4% rule
Historical research (the Trinity study) found that withdrawing about 4% of a portfolio a year, adjusted for inflation, lasted 30 years in most scenarios. So your FIRE number is your yearly spending ÷ 4%, or 25 times your annual expenses. Early retirees often use 3% to 3.5% for extra safety.
Example
To spend $4,000 a month you need $1.2 million. Starting with $50,000 and investing $1,500 a month at a 5% real return, you get there in about 27 years and 2 months.
Frequently asked questions
What about Social Security?
Expected benefits reduce how much your portfolio needs to cover, which lowers your number.
See also
Results are estimates for information only and are not financial, legal or medical advice. Rates, taxes and fees vary — confirm with a professional or your lender.