Early Retirement Calculator

Use this interactive calculator to determine when you can achieve financial independence and retire early based on your current financial situation.

Annual Income (after tax)$75,000

Annual Expenses$45,000

Current Portfolio$50,000

Annual Return (%)7% per year

Safe Withdrawal Rate (%)3% per year

How it works

• Target portfolio = Annual Expenses / Withdrawal Rate
• Simulates monthly compound growth until your portfolio reaches the target
• Your savings rate is the most important factor for early retirement
• Assumes constant expenses and reinvested returns

How It Works

The calculator uses the following formula to determine your path to financial independence:

1. Savings Rate: Calculated as (Income - Expenses) / Income
2. Target Portfolio: Your annual expenses divided by your safe withdrawal rate
3. Years to FI: Based on compound growth of your savings and current portfolio

Key Assumptions

• Safe Withdrawal Rate: The percentage of your portfolio you can withdraw annually in retirement (2-4%)
• Investment Returns: Expected annual return net of fees on your investment portfolio (2-7%)
• Constant Savings: Assumes you maintain consistent income and expenses

The path to financial independence is a marathon, not a sprint. Small increases in your savings rate can dramatically reduce the time to reach your goal.