Additional Notes

As Sabatier points out, some more recent studies suggest it may be wiser to aim for a lower withdrawal rate if you’re hoping for an extended retirement. Researchers at Morningstar peg the safe withdrawal rate at somewhere between 3.3% and 4%, accounting for factors such as relatively low yields in the bond market and relatively high valuations on stocks (which tend to dampen future returns).

If you do calculate your FIRE number and find yourself getting overwhelmed by a huge number, remember that you don’t have to get there all at once, says Sabatier.

As with any other one-step financial calculation, the FIRE number math is based on several assumptions and will vary based on your financial situation. Here’s what retirement experts say you need to know to figure out how much money you’ll need to retire.