Step 1: Estimate annual spending
Start with the amount you expect to spend in a typical year once work is optional.
That means looking at housing, food, healthcare, transport, travel, subscriptions, and the categories that actually matter in your life.
Step 2: Multiply by 25
A simple baseline is annual spending times 25. That gives you a starting target for invested assets.
If you expect to spend $48,000 per year, the rough FIRE number is $1.2 million.
Step 3: Check the assumptions
Your location, taxes, market expectations, and desired lifestyle can all push the number up or down.
That is why the first number should be treated as a planning draft, not the final truth.
Step 4: Focus on the levers
Once you have the target, the useful question becomes how to move faster: raise savings, cut recurring costs, or increase income.
The best FIRE tools help you see which lever matters most for your timeline right now.