Your FIRE number and years to reach it.
FIRE number
—
Years to FI
—
Still needed today
—
Turning annual spending into a target number
FIRE stands for financial independence, retire early, and the maths behind it is refreshingly simple. Work out what you spend in a year, decide what percentage of your portfolio you can safely withdraw annually, and divide one by the other. At a 4 percent withdrawal rate that means you need 25 times your annual spending invested, after which the portfolio's returns can fund your life indefinitely without you drawing down the capital. The hard part is not the formula, it is the years of saving a large slice of your income to reach the number.
This calculator does both halves. It computes your FIRE target from annual spending and a safe withdrawal rate, then projects how many years it takes to get there from your current savings, annual contributions and an expected return after inflation. Using a real, after-inflation return keeps everything in today's dollars, so the target you see is the target you can actually spend.
Reaching $1.5 million from where you are now
Run the default. You want $60,000 a year in retirement and use a 4 percent withdrawal rate, which sets your FIRE number at $1.5 million, or 25 times spending. You already have $150,000 invested, add $30,000 a year, and expect a 5 percent real return. The calculator grows the balance year by year until it reaches the target.
| Input | Value |
|---|---|
| Annual spending | $60,000 |
| Safe withdrawal rate | 4% |
| FIRE number (60,000 over 4%) | $1.5 million |
| Current savings | $150,000 |
| Added each year | $30,000 |
| Real return assumed | 5% |
| Years to financial independence | 22 years |
From $150,000 today, you are $1,350,000 short, and contributions plus compounding close that gap in 22 years. The chart sketches the path the balance takes toward the target line.
The KiwiSaver bridge problem
Here is the wrinkle that makes early retirement in New Zealand different. KiwiSaver is locked until you turn 65, so if you want to stop work at 50 you cannot rely on it for those first fifteen years. You need a bridge portfolio, money held outside KiwiSaver in shares, funds or savings that you can access at any age, to carry you from your retirement date to 65. Many people aiming for FIRE deliberately split their saving, contributing enough to KiwiSaver to capture the employer match and the annual government contribution, then routing the rest into accessible investments. NZ Super, the flat universal pension, then arrives on top once you reach 65, which actually reduces how large your private portfolio needs to be for the later years.
Why 4 percent is a starting point, not a guarantee
The 4 percent rule came from US market history, and it is a useful anchor rather than a law of nature. A few cautions for New Zealand investors. First, returns are taxed here, mostly through portfolio investment entities at a prescribed investor rate that tops out at 28 percent, so build that into the real return you assume. There is no general capital gains tax to plan around, which helps, but fund fees and PIE tax both quietly reduce what you keep. Second, a long retirement of 40 or more years is more demanding than the 30-year horizon the rule was tested on, so some Kiwis use 3.5 percent for a bigger safety margin, which lifts the target toward 28 times spending. A practical tip: run the calculator at both 3.5 and 4 percent and treat the gap as your margin of safety. The most common mistake is anchoring on an optimistic return like 8 percent before inflation, which makes the years to FI look far shorter than they will be once tax, fees and inflation are stripped out.
Should I include my home in my FIRE number?
Generally no. Your FIRE number represents the invested assets that generate income you can withdraw, and a home you live in produces no cash to spend. A mortgage-free home does lower your annual spending, which lowers the target, so account for it that way rather than counting the house as part of the portfolio. If you plan to downsize and free up capital later, you can treat the released equity as a separate top-up.
What is Coast FIRE and how does it differ?
Coast FIRE is the point where your existing investments will grow to your target by traditional retirement age without any further contributions, so you only need to earn enough to cover current spending. It is a softer milestone than full FIRE, useful if you want to ease off saving rather than stop working entirely. This calculator models full financial independence, where the portfolio funds your whole lifestyle, but reaching Coast FIRE first is a realistic interim goal.