When can you
retire early?

FIRE stands for Financial Independence, Retire Early. It's a movement focused on extreme saving and investing to achieve financial freedom decades before traditional retirement age. The goal is to accumulate enough wealth that investment returns can cover your living expenses indefinitely.

The 4% rule (also known as the Bengen Rule) comes from a 1994 study showing that retirees could withdraw 4% of their portfolio in year one, then adjust for inflation each year, and not run out of money over a 30-year retirement — based on historical US stock and bond market returns. Your FIRE number is simply your annual expenses multiplied by 25 (the inverse of 4%).

Your FIRE number depends entirely on your expected annual expenses in retirement. Multiply your annual expenses by 25 (at a 4% withdrawal rate). For example, if you need $40,000 per year, your FIRE number is $1,000,000. If you need $80,000 per year, your FIRE number is $2,000,000. There is no universal "good" number — it's personal.

Retirement accounts like KiwiSaver (NZ), 401k (US), and superannuation (AU) grow tax-advantaged but are locked until age 60-67. For early retirees, you need a "bridge strategy": enough money in taxable investment accounts to cover expenses from your early retirement date until you can access your locked retirement funds.

Yes. The key to FIRE is your savings rate, not your income level. Someone earning $60,000 who saves 50% can reach FIRE faster than someone earning $150,000 who saves 10%. Reducing expenses has a double effect: it increases your savings AND lowers your FIRE number (because you need less to live on in retirement).

Lean FIRE targets a frugal retirement lifestyle with annual expenses under $40,000. Regular FIRE targets $40,000–$80,000 per year for a comfortable lifestyle. Fat FIRE targets $100,000+ per year for a luxurious retirement. Barista FIRE is a hybrid where you retire from your career but work part-time to cover some expenses while investments cover the rest.