Early Retirement & FIRE
FIRE: Financial Independence, Retire Early
FIRE isn't about getting rich quick. It's a simple equation: save a lot, spend deliberately, and buy back your time.
The core idea
FIRE stands for Financial Independence, Retire Early. “Financial independence” means your investments can cover your living costs indefinitely — work becomes optional. “Retire early” is just the timeline that follows from a high savings rate.
The math, simplified
Build a portfolio of about 25× your annual spending, then withdraw ~4% a year. The higher your savings rate, the faster you get there — it's the engine of every FIRE plan.
Savings rate
50%
Years to FI
~17
Target
25× spend
What FIRE is not
- Not necessarily quitting work. Many reach FI and keep working — on their own terms.
- Not deprivation. It's spending on what matters and cutting what doesn't.
- Not risk-free. Long retirements face sequence risk and need a margin of safety.
The real product of FIRE isn't early retirement — it's options. Even halfway there, a big cushion changes how you negotiate, what risks you take, and how you sleep.
Where to start
Measure your spending, push your savings rate, invest in broad low-cost funds, and run your odds. The flavor of FIRE you choose comes next.
Key takeaways
- FIRE = enough invested that work becomes optional.
- Target ~25× annual spending; savings rate sets the speed.
- It's about options and flexibility, not deprivation.
- Plan for long horizons and sequence risk.