FIRE combines a very high saving rate (often 40–70% of income) with disciplined index investing. The finish line is typically 25× annual expenses invested, based on the 4% safe withdrawal rule.
Variants have emerged: Lean FIRE (minimal expenses), Fat FIRE (higher spending), Barista FIRE (part-time work covers healthcare), Coast FIRE (invest enough early that compounding alone reaches the number).
See also
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Open Financial OS →Frequently asked questions
Is FIRE realistic on average incomes?
Full FIRE is very hard on average incomes. Coast FIRE — investing enough early that you never need to add more — is achievable for many, and delivers most of the optionality.
Related terms
Saving rate
The percentage of take-home pay you keep rather than spend.
4% rule
A guideline suggesting you can withdraw 4% of a diversified portfolio in year one of retirement and adjust for inflation each year with a high chance of lasting 30 years.
Compound interest
Interest earned on both your original investment and the interest it has already generated.
Retirement
The stage of life when you have enough savings and income to make paid work optional.