FIRE: Retiring Early

What FIRE means

FIRE stands for Financial Independence, Retire Early. The idea: save and invest aggressively until your portfolio can sustain your spending indefinitely, at which point paid work becomes optional rather than required.

The core math: the 4% rule

A commonly used rule of thumb is that you can withdraw about 4% of your portfolio per year without running out of money over a long retirement, based on historical market returns. Working backward, that puts your 'FIRE number' at roughly 25 times your annual spending.

This is a historically-based estimate, not a guarantee — actual safe withdrawal rates depend on the market conditions you retire into, how flexible your spending can be, and how long your retirement actually lasts.

The savings rate is the whole game

At a 10% savings rate, funding a full retirement takes most of a working life. At 50%, it takes something closer to 17 years, because every extra point does double duty: it adds to the pot and it lowers the spending the pot has to cover. That symmetry is why FIRE conversations fixate on the rate rather than the salary.

Full FIRE usually means holding 40–70% of income for many years, which isn't realistic or desirable for most people — and that's a fine conclusion to reach. The math still tells you something useful if you never intend to retire early: it's the same math that decides when work becomes optional.

Before you optimise for it

Everything on the flowchart comes first. A high savings rate with credit card debt behind it isn't a plan, and retiring early with no cash buffer means selling investments in exactly the years you shouldn't.

If full FIRE looks out of reach, Coast FIRE is the more attainable milestone and worth tracking on its own terms.