What FIRE means
FIRE stands for Financial Independence, Retire Early. The idea: build investments large enough that a small, sustainable withdrawal each year covers your living costs. After that, working becomes a choice. Your FIRE number is that target corpus.
FIRE number = yearly expenses ÷ safe withdrawal rate
(at 3.5%, that is about 28.6 × yearly expenses)Worked example
Why Indian FIRE plans use 3–4%, not 4%
The famous "4% rule" came from US research on 30-year retirements. Indian early retirees face higher inflation, may need money for 40–50 years, and must cover healthcare themselves. That's why many Indian FIRE planners use 3–3.5%, which means a larger corpus of 28–33 times annual expenses.
What to include in expenses
- Everyday living: rent or home maintenance, groceries, utilities, transport.
- Health insurance premiums, which rise sharply with age, plus a buffer for costs it won't cover.
- Children's education and support for parents, unless they are funded separately.
- Travel, gadgets and replacing a car every 8–10 years.
For a traditional retirement at 58–60, the retirement calculator models both the saving years and the spending years. To test withdrawals from a finished corpus, use the SWP calculator.
Frequently asked questions
Is 3.5% really safe?
No withdrawal rate is guaranteed. Lower rates are safer, and keeping 2–3 years of expenses in debt funds helps you avoid selling equity during a crash.
Should I include my house in the FIRE corpus?
Not the home you live in, because it doesn't produce income. A rented property can count, using its net rental income.
What about EPF and PPF?
Include them in 'investments you already have' if you will be able to access them when you stop working.