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Fat FIRE Calculator

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Understanding the Fat FIRE calculator — concept and principle

Fat FIRE is the comfortable version of FIRE (Financial Independence, Retire Early): financial independence on a generous budget with room for travel, a larger home or helping family. The calculator turns that budget into a target portfolio and estimates the years of saving needed.

Fat FIRE target as 25 years of spendingSpending of $100,000 a year divided by a 4% withdrawal rate gives a $2,500,000 target, 25 years of spending. Starting from $150,000 and adding $30,000 a year at a 5% real return, the balance is $621,671 after 10 years, $1,389,973 after 20 and $2,641,457 after 30, first passing the target in year 30.Fat FIRE: 25 years of spending in one pot1 year$100,000÷ 4% = × 2525 × $100,000= $2,500,000 targetnow$150,000year 10$621,671year 20$1,389,973year 30$2,641,457× 1.05 + $30,000 each yearReached in year 30 · spend $8,333 a month
At 4% the pot is 25 times one year of spending; with the default saving it takes about 30 years to grow there.

How it is calculated

The target comes from the withdrawal-rate rule: Target = annual spending ÷ safe withdrawal rate. At 4% the target is 1 ÷ 0.04 = 25 times your yearly spending; at 3.5% it is about 28.6 times.

The years to target are found by simulation, one year at a time: balance(next year) = balance × (1 + real return) + yearly saving. The count stops in the first year the balance reaches the target (or after 100 years).

Spending is in today's money, saving is added at the end of each year, and the return is real (after inflation).

The principle

A withdrawal rate links a lump sum to an income stream. Studies of historical US stock and bond returns found that taking about 4% of the starting portfolio, then raising the amount with inflation, survived almost every 30-year period. Dividing spending by that rate gives the pot that can "pay you" indefinitely with acceptable risk.

Worked example

  1. Inputs: spending 100,000, savings 150,000, saving 30,000 a year, real return 5%, withdrawal rate 4%.
  2. Target = 100,000 ÷ 0.04 = $2,500,000 (25× spending). Monthly spending = 100,000 ÷ 12 = $8,333.
  3. Year 1: 150,000 × 1.05 + 30,000 = 187,500. Year 2: 187,500 × 1.05 + 30,000 = 226,875.
  4. Continuing, the balance is about 2,487,102 after year 29 and 2,641,457 after year 30.
  5. The target is first reached in year 30, so the result is about 30 years away.

How to read the result

A large Fat FIRE target is normal: every extra 10,000 of yearly spending adds 250,000 to the goal at 4%. If the timeline is too long, the strongest levers are higher yearly saving and a realistic spending number.

Common mistakes

Keep in mind: This is a simplified projection with a constant return, not financial advice. Real markets vary year to year, and a bad sequence of returns early in retirement can deplete a portfolio even when the average looks fine.

Frequently asked questions

How much money do I need for Fat FIRE?

Divide your planned yearly spending by your withdrawal rate. At 100,000 a year that is 2.5 million at 4% or about 2.86 million at 3.5%.

Which withdrawal rate should an early retiree use?

Many planners use 3–3.5% for horizons longer than 30 years, because the original 4% research covered 30-year retirements.

Does the calculator include pensions?

No. If you expect a pension or social security later, subtract that income from your spending or plan in two stages.

Sources: Bengen, W. P. (1994), "Determining Withdrawal Rates Using Historical Data", Journal of Financial Planning. · Cooley, Hubbard & Walz (1998), "Retirement Savings: Choosing a Withdrawal Rate That Is Sustainable", AAII Journal (the Trinity study).

Checked 8 Nov 2026. Standard financial mathematics (time value of money). Estimates for information only — not financial advice.

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