In his own words: FIRE … “It’s all built around our safe withdrawal rate assumption. Within the early retirement community many point to a safe withdrawal rate of 4% (25x annual expenses) being the target. Most calculators out there will estimate a 4% rate having a success rate of over 80%, which is really good. We on the other hand want a success rate approaching 100%. In order to do that you need to be at or below 3%. Doing this however, significantly increases the amount that you will need to save.”
When you get right down to it, FIRE is a math problem. And the granddaddy formula we all need to figure out is the Safe Withdrawal Rate (SWR) that will sustain us throughout retirement.