Financial Independence Retire Early (FIRE) Calculator
function calculateFIRE() {
var currentAge = parseFloat(document.getElementById('currentAge').value);
var currentSavings = parseFloat(document.getElementById('currentSavings').value);
var annualExpenses = parseFloat(document.getElementById('annualExpenses').value);
var annualSavingsContribution = parseFloat(document.getElementById('annualSavingsContribution').value);
var investmentReturnRate = parseFloat(document.getElementById('investmentReturnRate').value) / 100;
var withdrawalRate = parseFloat(document.getElementById('withdrawalRate').value) / 100;
var resultDiv = document.getElementById('fireResult');
resultDiv.innerHTML = "; // Clear previous results
// Input validation
if (isNaN(currentAge) || currentAge < 18 || isNaN(currentSavings) || currentSavings < 0 ||
isNaN(annualExpenses) || annualExpenses <= 0 || isNaN(annualSavingsContribution) || annualSavingsContribution < 0 ||
isNaN(investmentReturnRate) || investmentReturnRate < 0 || isNaN(withdrawalRate) || withdrawalRate 0.10) { // Common sense check for withdrawal rate
resultDiv.innerHTML = 'A safe withdrawal rate is typically between 3% and 5%. A rate above 10% is generally not sustainable.';
return;
}
// Calculate FIRE Number
var fireNumber = annualExpenses / withdrawalRate;
// Calculate Years to FIRE (Iterative)
var yearsToFire = 0;
var simulatedSavings = currentSavings;
var simulatedAge = currentAge;
var maxYears = 150 – currentAge; // Prevent infinite loops for unrealistic scenarios
if (annualSavingsContribution <= 0 && simulatedSavings = fireNumber) {
resultDiv.innerHTML += 'You have already reached your FIRE number!';
}
resultDiv.innerHTML += 'Your FIRE Number: $' + fireNumber.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) + ";
resultDiv.innerHTML += 'Estimated Monthly Passive Income at FIRE: $' + (fireNumber * withdrawalRate / 12).toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) + ";
return;
}
if (simulatedSavings >= fireNumber) {
yearsToFire = 0;
} else {
while (simulatedSavings < fireNumber && yearsToFire = maxYears && simulatedSavings < fireNumber) {
resultDiv.innerHTML = 'It appears you may not reach your FIRE number within a reasonable timeframe (e.g., by age 150) with your current inputs. Consider increasing savings, reducing expenses, or adjusting your expected return/withdrawal rate.';
} else {
resultDiv.innerHTML += 'Your FIRE Number: $' + fireNumber.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) + ";
resultDiv.innerHTML += 'Estimated Years to Financial Independence: ' + yearsToFire + ' years';
resultDiv.innerHTML += 'Estimated Age at Financial Independence: ' + fireAge + ' years old';
resultDiv.innerHTML += 'Estimated Monthly Passive Income at FIRE: $' + monthlyPassiveIncome.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) + ";
}
}
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Understanding Financial Independence, Retire Early (FIRE)
The Financial Independence, Retire Early (FIRE) movement is a lifestyle philosophy with the goal of accumulating enough financial assets to live off investment income, thereby no longer needing to work for money. This allows individuals to retire much earlier than the traditional age, often in their 30s or 40s.
The Core Principle: The 4% Rule (or 25x Rule)
At the heart of many FIRE strategies is the "4% Rule," also known as the "25x Rule." This rule suggests that if you save 25 times your annual expenses, you can safely withdraw 4% of your investment portfolio each year, adjusted for inflation, without running out of money. This 4% withdrawal is intended to cover your living expenses, making you financially independent.
For example, if your annual expenses are $40,000, you would need to accumulate $40,000 * 25 = $1,000,000 in investments to be financially independent according to this rule.
How the FIRE Calculator Works
Our Financial Independence Retire Early (FIRE) Calculator helps you estimate how long it will take to reach your FIRE number based on your current financial situation and savings habits. Here's a breakdown of the inputs:
Current Age (Years): Your current age. This helps determine your estimated age at FIRE.
Current Investments (USD): The total amount you currently have saved and invested in accounts like 401(k)s, IRAs, brokerage accounts, etc.
Annual Expenses ($): Your total yearly living costs. This is a crucial number, as it directly determines your FIRE number. The lower your expenses, the less you need to save.
Annual Savings Contribution (USD): The total amount you plan to save and invest each year. This includes contributions to retirement accounts, taxable brokerage accounts, etc.
Expected Annual Investment Return (%): Your anticipated average annual return on your investments, ideally after accounting for inflation. A common historical average for a diversified portfolio might be 5-7%.
Desired Safe Withdrawal Rate (%): The percentage of your portfolio you plan to withdraw annually in retirement. The 4% rule is a popular starting point, but some choose 3% for more conservatism or 5% for a more aggressive approach.
Understanding the Results
Your FIRE Number: This is the total amount of money you need to have invested to cover your annual expenses based on your desired safe withdrawal rate.
Estimated Years to Financial Independence: This is the projected number of years it will take you to reach your FIRE number, considering your current savings, annual contributions, and investment returns.
Estimated Age at Financial Independence: Your estimated age when you achieve financial independence.
Estimated Monthly Passive Income at FIRE: The amount of passive income you can expect to receive monthly from your investments once you reach your FIRE number.
Example Scenario:
Let's consider a realistic example:
Current Age: 30 years
Current Investments: $50,000
Annual Expenses: $40,000
Annual Savings Contribution: $15,000
Expected Annual Investment Return: 7%
Desired Safe Withdrawal Rate: 4%
Using these inputs, the calculator would determine:
FIRE Number: $40,000 / 0.04 = $1,000,000
Estimated Years to Financial Independence: Approximately 25 years
Estimated Age at Financial Independence: 30 + 25 = 55 years old
Estimated Monthly Passive Income at FIRE: ($1,000,000 * 0.04) / 12 = $3,333.33
This example shows that by consistently saving and investing, financial independence can be achieved well before traditional retirement age, offering more freedom and choices in life.