FIRE (Financial Independence, Retire Early)

FIRE is a movement and a math problem. The goal is to save and invest aggressively enough that your portfolio can cover your living expenses indefinitely, freeing you from needing to work for money. The common target is a nest egg of about 25 times your annual spending, which is simply the inverse of the 4 percent rule: if you can safely withdraw 4 percent a year, you need 25 times your expenses saved.

The lever that makes FIRE possible is your savings rate. Cutting expenses does double duty, because it both frees up money to invest and lowers the nest egg you need to hit. Variations include lean FIRE for very low spending, fat FIRE for a richer lifestyle, and coast FIRE, where you save enough early that compound growth alone carries you to a normal retirement age. Our FIRE number playbook examines whether the 4 percent rule still holds and what target makes sense today.