Lean FIRE Calculator

How Lean FIRE works

Lean FIRE means reaching financial independence on a small budget. Your investments cover the essentials, such as housing, food, insurance and getting around, with little set aside for extras. Because the budget is smaller, the portfolio you need is smaller too, and that can take years off your working life.

What counts as lean?

There's no official line. In the US, people often describe a household budget under roughly $40,000 a year as lean, and some use a lower bar for a single person. These are informal conventions from online FIRE communities, not rules. What matters is whether the budget pays for your actual life, where you live, with some room for surprises. Lean FIRE vs Fat FIRE compares the two ends of the range.

A worked example

Spending $28,000 a year at a 4% withdrawal rate gives a Lean FIRE number of $700,000. Starting at 32 with $185,000 invested and $1,500 a month going in, at a 7% yearly return and 2.5% inflation (a 4.39% real return), you'd reach it in 14 years 5 months, at age 46. The same saver aiming for $40,000 a year needs $1,000,000 and gets there at 51, so the leaner budget saves about five and a half years of work.

At a more cautious 3.5% rate, the lean target rises to $800,000 and takes 16 years 5 months (age 48). Trimming spending to $24,000 a year lowers the 4% target to $600,000, reached in 12 years 3 months (age 44).

Why a lean plan has less room for error

A lean budget has little slack. If prices rise faster than you expected or a health bill arrives, there's not much to cut, because most of the money already goes on essentials. A market fall early in retirement is also harder to ride out when you can't easily spend less. That's why many lean planners choose a lower withdrawal rate of 3% to 3.5%, hold a cash buffer, or count on some part-time income. The Barista FIRE calculator shows how much a part-time paycheck lowers the portfolio you need.

In the US, health insurance deserves its own line. Before Medicare at 65 you'll usually buy coverage yourself, and the cost depends on your income, age and state. Include it, along with any tax you expect to pay, in the spending you enter above.

Ways to make a lean plan sturdier

• Live on your lean budget for a year before you quit, to check it's real.
• Add irregular costs, such as car replacement, home repairs and dental work, divided per year.
• Look at the 3% and 3.5% rows in the table above to see what extra margin costs you.
• Decide your fallback ahead of time: which costs you'd cut, or how you'd earn some income, if markets fall.

Lean FIRE and Coast FIRE

A small target also means you can reach Coast FIRE quickly. With $28,000 of spending and the example savings, you'd hit Coast FIRE after 1 year 6 months: from then on, growth alone could carry you to $700,000 by 60, even if you stopped saving. The Coast FIRE calculator finds that month for your own numbers, and the Coast FIRE number page shows how much you need invested at each age.

For a budget that isn't especially lean, use the FIRE number calculator. The methodology page explains every formula and default, and for background, read what is FIRE and the 4% rule explained.