This free FatFIRE calculator is designed to calculate the data performance under the FatFIRE scenario within the FIRE framework. Its purpose is to help you understand what FatFIRE means and what changes might occur when you adjust some of the input variables.
What is Fat FIRE
Many people talk about FIRE (Financial Independence, Retire Early), and some even aim for Fat FIRE (or can be written as FatFIRE). But the real question is: what do you do after retirement? The concept of FIRE has led many to reflect on the deeper question: What’s the purpose of retiring early?
Fat FIRE refers to a retirement model that supports a higher-than-average standard of living (comparing the LeanFIRE). It’s typically the farthest goal to reach because it requires more time and a significantly larger retirement fund. However, it also offers greater flexibility in absorbing risk due to stronger cash flow. The key to achieving Fat FIRE is increasing active income.
At this stage in life, I’ve come to think more about the idea of “retire without quitting.” In recent years, I’ve met many senior executives or people who are close to financial independence (depending on how you define it), and truthfully, none of them are actually resting in the strictest sense.
What Defines FatFIRE
It primarily depends on annual expenses and the Safe Withdrawal Rate (SWR). Generally, a Fat FIRE target is double or more than the annual spending of a standard FIRE plan, ensuring a high-quality lifestyle. The younger you are, the higher the withdrawal rate you’ll need to plan for, which means you’ll need to accumulate even more.
If you plan to raise children, Fat FIRE becomes even harder to achieve—it can feel like a bottomless pit in terms of spending.
Common Fat FIRE Benchmarks
Minimum Standard:
• Annual expenses: $100,000
• Required assets: $2.5M–$3.3M (assuming a 3%–4% withdrawal rate)
Mid-Level Standard:
• Annual expenses: $200,000
• Required assets: $5M–$6.7M
High-End Standard:
• Annual expenses: $300,000+
• Required assets: $7.5M+
To pursue Fat FIRE, your annual income typically needs to be at least $200,000+ USD — common in industries like tech, finance, medicine, law, or entrepreneurship. You should aim to increase your savings rate to 50%–70%, and maintain a long-term investment return rate of 7%–10%. The higher each of these numbers, the sooner you can reach Fat FIRE.
FatFIRE vs FIRE
Based on my understanding, FatFIRE and standard FIRE do not differ in their fundamental calculation methods. The core difference between the two lies in the standard of living. With greater assets, individuals pursuing FatFIRE can enjoy a higher quality of life and have more funds to purchase higher-priced goods. However, regardless of the lifestyle, the method of growing assets remains similar—only the amount invested differs. FatFIRE is more suitable for high-income individuals who seek to retire without compromising on their lifestyle.
How to use FatFIRE Calculator
You need
- At the beginning, you need to enter your current age, current annual income, and annual expenses.
- You should also input your current total assets, along with the allocation of these assets across different investment types (the total should add up to 100%). Different investment types will have different rates of return.
- You may enter decimal values if you believe they provide a more accurate estimate.
- The investment return rate is an estimate of how your invested money grows annually. This calculator will provide a default value for your convenience, but you can update it for a more precise estimate. Based on the past 10 years of S&P 500 returns, this rate is typically above 7%.
- The inflation rate reflects how your cash loses value over time. This is usually around 3%, though the number can vary depending on the country.
- The Safe Withdrawal Rate (SWR) estimates the percentage of your assets you can withdraw each year for daily expenses. This is typically set at 4%. The lower this rate, the harder it is to achieve FIRE (Financial Independence, Retire Early), as it means you need a higher total amount of assets.
Math behind Fat FIRE Calculator
The formula to calculate your Fat FIRE number is:
\[ \text{Fat FIRE Number} = \frac{\text{Annual Spending}}{\text{SWR}} \]
Where:
- Annual Spending = your desired annual expenses in retirement
- SWR = Safe Withdrawal Rate (e.g., 0.04 for 4%)
is one of the core components of the entire calculator.
The standard compound interest formula is:
\[ A = P \times (1 + r)^t \]
Where:
- A = the future value of the investment or loan, including interest
- P = the principal amount (initial investment)
- r = the annual interest rate (as a decimal)
- t = the number of years the money is invested or borrowed for
Inflation consideration
Inflation is a crucial factor to consider when planning for retirement. Unlike stocks and mutual funds, cash gradually loses value over time due to inflation. The inflation rate typically ranges from 2% to 3%. This calculator already takes inflation into account—you just need to adjust the specific parameter. If you have a more pessimistic outlook, you can set a higher inflation rate.
FAQ
You can export the CSV file or save as image.
Yes, there are several “Advanced Settings” sections at the bottom of the calculator that you can expand to customize the default values.
All amounts are in today’s dollars.
Privacy and Data Usage Statement: Please note that all data you enter into this FIRE calculator is not transmitted to our servers or anywhere else. All of your data is anonymous and exists only within your browser.
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Disclaimers
This calculator is a model, not a prediction. The results are based on the limited information you’ve provided and certain assumptions about the future. All figures are estimates only and are not guaranteed.
It cannot accurately predict your final superannuation balance or retirement income, as these depend on many personal and external factors—such as your individual circumstances, unexpected life events, government Age Pension entitlements, investment returns, tax, and inflation.
The model assumes consistent contributions and stable conditions over time. These assumptions allow you to explore the potential impact of decisions within your control, such as changing your investment strategy.
We recommend reviewing and updating the projections regularly, especially if your situation changes. You can adjust some of the assumptions to better reflect your personal circumstances.
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