FI Number Calculator
Calculate your Financial Independence number — the nest egg you need to retire using the 4% rule.
Your FI number is the amount of money you need invested to live off returns indefinitely. The classic formula: annual expenses divided by your safe withdrawal rate. At 4%, $50K/year in expenses means a $1.25M FI number. This is the most fundamental calculation in the FIRE movement — once you know your number, every other financial decision becomes clearer.
Your FI number is $1,250,000. At a 4% withdrawal rate, this generates $50,000/year — covering your estimated annual expenses.
What you'd spend annually in retirement
4% is standard; 3.5% is more conservative
Your FI number
FI number
$1,250,000
Withdrawal rate
4%
Monthly expenses
$4167
Annual expenses
$50,000
How to use this calculator
Annual expenses — Your expected yearly spending in retirement. Include housing, food, healthcare, insurance, and discretionary spending. A common mistake: underestimating healthcare costs, which average $5–7K/year for retirees.
Safe withdrawal rate — The percentage of your portfolio you withdraw in year one. 4% is the classic rule from the Trinity Study. For longer retirements (40+ years), consider 3.5% or even 3% for extra safety.
Real-world examples
Moderate spender: $40K/year
At 4% SWR: FI number = $1,000,000. At 3.5% SWR: $1,142,857. The difference between 4% and 3.5% is ~$143K — that extra safety margin costs about 2–3 more years of saving for most people.
High-cost area: $80K/year
At 4% SWR: FI number = $2,000,000. This is why many FIRE seekers move to lower-cost areas — halving expenses halves your FI number and can shave a decade off your working years.
Lean FIRE: $25K/year
At 4% SWR: FI number = $625,000. At 3.5%: ~$714K. Lean FIRE requires significant lifestyle sacrifices but can be achieved in 7–10 years on a median income with aggressive saving.
Formula & Methodology
FI Number formula
- Annual Expenses = Total yearly spending in retirement
- Withdrawal Rate = Safe withdrawal rate (e.g., 0.04 for 4%)
This is derived from the 4% rule (Trinity Study). The inverse of your withdrawal rate gives your multiplier: 4% = 25x expenses, 3.5% = 28.6x, 3% = 33.3x.
Assumptions & limitations
- The 4% rule is based on US historical data (1926–1995) and may not hold in all future scenarios.
- Longer retirements (40+ years for early retirees) may require lower withdrawal rates.
- Expenses in retirement may differ significantly from current spending.
- This does not account for Social Security, pensions, or other income sources.
Frequently asked questions
What is the 4% rule?
The Trinity Study found that withdrawing 4% of your portfolio in year 1 (adjusted for inflation after) has a ~95% success rate over 30 years with a 50/50 stock/bond portfolio. Some prefer 3.5% for longer retirements.
How do I estimate my retirement expenses?
Start with current spending, then adjust: remove work-related costs (commute, work clothes), add healthcare (if leaving employer insurance), and account for mortgage payoff if applicable. Most people spend 80–100% of their current amount.
Does my FI number include my home?
Generally no — your FI number should be investable assets that generate returns. Your home doesn't produce income unless you plan to downsize or use a reverse mortgage. Include home equity only if you plan to sell and invest the proceeds.
What if I have Social Security or a pension?
Subtract expected annual income from your annual expenses before calculating. If you need $50K/year and Social Security covers $20K, you only need your portfolio to generate $30K — reducing your FI number from $1.25M to $750K at 4%.