Intergtm

Financial Independence Number Calculator

Determine the portfolio size needed to retire based on your annual expenses and chosen withdrawal rate.

Inputs

Essential expenses needed to maintain your desired lifestyle

%

4% rule is standard; 3% is conservative for long retirements

%

Extra portfolio size above the base FI number for conservatism

%
%

Results update as you type, and the address bar keeps your numbers so the link you share reopens this exact calculation.

FI number (portfolio needed)

$1,500,000

At 4% withdrawal rate.

Detailed results
FI number with safety margin$1,667,000
Annual expenses$60,000
Real (inflation-adjusted) withdrawal rate1%
Years for 1× expenses to compound to FI number47.6

What this result means

FI number (portfolio needed): $1,500,000.

Your FI number is $1500k (base), or $1667k with safety margin. This portfolio will support $60,000 in annual expenses at your chosen withdrawal rate.

Withdrawal Schedule (First 30 Years)

Annual withdrawals over 30 years assuming constant withdrawal rate and 3% inflation.

Withdrawal Schedule (First 30 Years). 30 rows, first 12 shown.
YearPortfolio ValueAnnual WithdrawalReal Withdrawal (Today's $)
1$1,545,000$60,000$60,000
2$1,591,350$61,800$60,000
3$1,639,091$63,654$60,000
4$1,688,263$65,564$60,000
5$1,738,911$67,531$60,000
6$1,791,078$69,556$60,000
7$1,844,811$71,643$60,000
8$1,900,155$73,792$60,000
9$1,957,160$76,006$60,000
10$2,015,875$78,286$60,000
11$2,076,351$80,635$60,000
12$2,138,641$83,054$60,000

How this is calculated

FI number = annual_expenses / withdrawal_rate. Real withdrawal rate = nominal withdrawal rate − inflation rate. Years to FI approximated assuming annual savings = annual expenses and constant return.

The Financial Independence (FI) number is the portfolio size that allows you to live off investment returns without working. The most famous rule is the 4% rule: if you have 25× your annual expenses invested, you can safely withdraw 4% per year indefinitely.

The 4% rule origin. Developed in the 1990s by Trinity University researchers (the Trinity Study), the 4% rule says a portfolio sized at 25× annual expenses has a 95% success rate over 30 years, assuming a balanced 60/40 stock/bond allocation and annual rebalancing.

Why 4%? Over the long run, a diversified portfolio returns ~7% nominal (accounting for inflation, ~4% real). A 4% withdrawal leaves 3% for portfolio growth and inflation coverage. The 1% margin of safety accounts for sequence-of-returns risk (bad markets early in retirement).

Real vs nominal. The 4% rule is stated in nominal terms, but you'll typically increase withdrawals with inflation. A 4% nominal withdrawal rate combined with 3% inflation gives a ~1% real withdrawal rate — that's why the portfolio lasts indefinitely.

Shorten the rule. Many early retirees use 3.5% or 3% for extra safety, especially if retiring before 65 (longer time horizon). Some use 3.5% conservatively and can adjust spending down in bear markets.

Tax-efficient withdrawal. In early retirement before 59½, you face penalties on most retirement accounts. Consider Roth conversions, tax-loss harvesting, and taxable-account withdrawals to minimize tax drag.

Assumptions

  • Withdrawal rate applied to initial portfolio to calculate FI number; assumes constant real withdrawals (inflation-adjusted) or nominal withdrawals at the stated rate.
  • Portfolio return is constant annually (in reality, returns are volatile; sequence risk in early retirement can affect outcomes).
  • No taxes modeled on returns or withdrawals; actual tax-adjusted returns depend on account type and withdrawal strategy.
  • No Social Security, pensions, or other income sources included; these reduce FI number needed.
  • Safety margin is a percentage adjustment to the base FI number; actual portfolio volatility and personal risk tolerance should inform this choice.

Frequently asked questions

›Is the 4% rule safe?

The Trinity Study (1998) of historical returns shows a 95% success rate over 30-year retirements with a 60/40 stock/bond portfolio — meaning 1 in 20 paths run out of money. That's not 100% safety. For greater certainty, reduce to 3.5% or 3%, accepting lower annual spending. For retirements spanning 50+ years, 3.5% is more prudent because sequence-of-returns risk is higher over longer horizons. Consider 3% if retiring before 55 or facing high portfolio concentration.

›What if returns are lower than expected?

The 4% rule assumes ~7% nominal long-term stock returns (roughly 4% real, after inflation). If markets deliver only 5% nominal going forward, a 4% withdrawal rate depletes your portfolio faster and is riskier. Your options: reduce withdrawals (3% instead of 4%), work longer to build a larger nest egg, plan to reduce spending in down markets (dynamic spending), or assume higher portfolio returns from a different asset mix.

›Does inflation matter?

Yes, critically. The 4% rule works because you increase withdrawals annually with inflation — so your purchasing power stays constant. If you cannot or will not raise withdrawals each year, you gradually run out of real spending power. If inflation unexpectedly exceeds expectations, standard portfolios (60/40) may not keep pace, forcing you to reduce spending anyway. This is why real return assumptions and inflation risk matter as much as nominal returns.

›What about Social Security in early retirement?

Social Security dramatically lowers your FI number. A married couple claiming $3k/month combined ($36k/year) reduces the portfolio needed by ~$900k at the 4% rule (because $36k ÷ 4% = $900k). Social Security acts as a safety net, letting you reduce portfolio withdrawals and increase safety margin. If retiring at 55 and claiming at 62, model Social Security conservatively (current law) but recognize it's additional security once claiming begins.

›Can I retire early with the 4% rule?

Yes, mathematically. The 4% rule works for 30-year horizons, but a 35–40-year retirement (retiring at 35–40) has materially higher failure risk due to sequence-of-returns risk and higher inflation exposure. Consider using 3% or lower for early retirement. Alternatively, build flexibility: plan to reduce spending in bear markets, work part-time to supplement, or claim Social Security at 62 (vs. delaying) to reduce portfolio pressure. A 'floor' of certain income (Social Security) plus flexible portfolio withdrawals is safer than rigid 4% withdrawals alone.

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