How do you calculate your FIRE number?

The short version: take what you actually spend in a year and multiply it by 25. That comes from flipping a 4% withdrawal rate into a multiple — spend $60,000 a year, and a $1,500,000 portfolio can theoretically sustain it indefinitely. The number moves a lot from there depending on how carefully you built the spending figure, how long the retirement needs to last, and whether any income keeps arriving after you stop working full-time.

Most of the disagreement about FIRE numbers is really disagreement about those three inputs, not about the arithmetic. Two households earning identical incomes can land on FIRE numbers a million dollars apart once one of them spends conservatively and plans to freelance part-time, and the other spends at the edge of their income and wants a clean break from work entirely.

Spending sets the number, not income

A FIRE number is a multiple of spending, full stop — income only enters as the thing that funds saving toward it. This trips people up because most financial benchmarks scale with income: what to save, what house you can afford, what a comfortable retirement "should" look like. The FIRE number does not work that way. A household earning $150,000 and spending $55,000 needs a smaller portfolio than a household earning $90,000 and spending $75,000, even though the second household's income is well below the first's.

That is also why raising your savings rate attacks the number from both directions at once. Every dollar you choose not to spend does two things simultaneously: it adds to the portfolio you're building, and it shrinks the spending figure the portfolio eventually has to support, since the number you're aiming for is a multiple of exactly that figure. A higher earner who spends less is not just saving more — they are also lowering their own target while everyone else's stays where it is.

Build an honest annual spending figure

The multiple is only as good as the number you feed it, and the most common mistake is building that number from a monthly budget estimate instead of a full year of actual transactions. A budget estimate misses the costs that don't show up every month — insurance premiums, car repairs, holiday gifts, an annual trip — and every one of those gets left out of the FIRE number along with it.

The gap is usually bigger than people expect:

Missing the irregulars here understates the FIRE number by more than $237,000 — not a rounding error, a materially different target that would leave the portfolio short in exactly the years those costs actually land. Pull twelve months of real transactions rather than reconstructing a budget from memory, and go back further if the last year had anything unusual in it, good or bad.

The multiple is not fixed at 25

Twenty-five times spending comes from a 4% withdrawal rate, which is itself an estimate built from historical market returns over rolling 30-year periods. It held up well across most of the historical record, but "most" is doing real work in that sentence, and 30 years is a specific assumption that doesn't fit everyone's actual retirement length. The full case for where the number comes from, and where it gets shaky, is covered in the four percent rule — the short version here is that the multiple and the withdrawal rate are two names for the same choice, related by simple division.

Multiple needed at different withdrawal rates

	Multiple needed at different withdrawal rates
5%	20×
4%	25×
3.5%	29×
3%	33×

Multiple = 1 ÷ withdrawal rate, rounded to the nearest whole number. A lower rate trades a larger portfolio for more room against sequence-of-returns risk and a longer time horizon.

Two things push the multiple higher than 25. The first is retirement length: the 4% figure was tested against 30-year retirements, and someone retiring in their thirties or forties with a 40-plus year horizon is asking the portfolio to survive markedly longer, which argues for a lower withdrawal rate and a correspondingly higher multiple — 28× to 33× is a common range for an early retirement. The second is sequence-of-returns risk: a portfolio that takes a serious downturn in its first few withdrawal years is in real trouble even if the average return over the whole retirement turns out fine, because withdrawals during a down market lock in losses that a portfolio still being contributed to never has to realize. A more conservative multiple is partly a hedge against bad early timing, not just a longer horizon.

Someone with a shorter runway to retirement — a traditional retirement in their sixties lasting 20 to 25 years — can reasonably lean toward the lower end, closer to 25× or even a bit under, since the portfolio has fewer years left to weather a downturn.

Part-time income shrinks the number fast

The multiple applies to whatever the portfolio alone has to fund — not to total spending, if something else is covering part of it. This is the single biggest lever available to someone who doesn't want, or can't reach, a fully income-free retirement: any income that keeps arriving after the portfolio needs to start supporting you reduces the number by that income times the multiple, not just by the income itself.

Take a household spending $60,000 a year. Funded entirely from the portfolio at 25×, that is a $1,500,000 target. Add $18,000 a year from part-time work, freelancing, or a small side business — the portfolio only needs to cover the remaining $42,000, which drops the number to $1,050,000. Eighteen thousand dollars of ongoing income removed $450,000 from the target, because the reduction gets multiplied the same way the spending figure does.

This is the mechanism behind what people call Barista FIRE and Coast FIRE — working part-time or letting a portfolio grow untouched for a few more years rather than aiming for full income independence on day one. Types of FIRE walks through those variations and which one fits a given situation; the arithmetic above is what makes all of them work.

What the number looks like across spending levels

Putting the pieces together — an honest spending figure and a multiple chosen for your retirement length — produces a wide range of outcomes depending on where you land on each axis:

Reading down a column shows what a dollar of spending is worth at that multiple; reading across a row shows what a longer, more conservative retirement costs at the same spending level. Neither axis is free to ignore — a household that gets the spending figure right but picks an unrealistically aggressive multiple has the same problem as one that picks a cautious multiple but understates spending by a third.

Turning the number into a plan

Once the target is set, the two remaining questions are how fast you can reach it and what actually happens once you start drawing from it. The FIRE calculator runs your own spending, savings rate, and expected return to project a timeline against a target built the way this guide describes, and the savings-rate calculator shows exactly how much a change in that rate moves the date. Getting to the number is only half the plan — the decumulation planner models what withdrawing from it actually looks like year by year, including the sequencing questions a multiple alone can't answer.