Financial Independence, Retire Early (FIRE) Explained

Hear FIRE, think 'retire at 40'. The actual prize is what changes the day a salary becomes optional. The framework, the maths and what you actually feel when you cross the line.

Years to financial independence by savings rate

10% saved51 years

25% saved32 years

40% saved22 years

50% saved17 years

65% saved11 years

Assumes a 7% real return. Savings rate, not salary, is the lever that matters.

Key takeaways

Financial Independence, Retire Early (FIRE) means earning enough from investments to cover living expenses without needing a job.

FIRE focuses on freedom, flexibility, and intentional living, which can mean retiring early or simply having the security to choose how to spend time.

The savings rate, or the percentage of income saved and invested, is a key factor in achieving FIRE.

FIRE strategies usually involve long-term investing in broad index funds and low-cost diversified portfolios.