🔥FIRE Calculator

Accounting for High Indian Inflation

The most critical factor for FIRE in India is inflation. While the 4% rule is popular in the US, the Reserve Bank of India (RBI) tracks a much higher Consumer Price Index (CPI). To ensure your corpus lasts 40+ years, many Indian financial planners recommend a 3% withdrawal rate and an inflation-adjusted return expectation. Our calculator allows you to input custom inflation rates to ensure your corpus doesn't lose purchasing power by your 50s.

Reserve Bank of India (RBI)

The Role of EPF and NPS in FIRE

The Employee Provident Fund (EPF) and National Pension System (NPS) are the pillars of retirement for salaried Indians. While NPS has a lock-in until age 60, EPF can be withdrawn after 2 months of unemployment. For a FIRE practitioner, these funds act as the 'late-stage' retirement corpus. Maximizing the 10% employer contribution to NPS under Section 80CCD(2) is a tax-efficient way to build this long-term bucket.

PFRDA – National Pension System

Building a Diversified Indian Portfolio

SEBI-registered advisors emphasize that an Indian FIRE portfolio should include a mix of Nifty 50 Index funds, Debt funds for stability, and Gold. Gold remains a cultural and financial hedge in India. Given the volatility of the Indian markets, having a 'buffer' or 'emergency fund' equivalent to 2 years of expenses in liquid funds is recommended to avoid selling equity during a market downturn.

Securities and Exchange Board of India (SEBI)

What is a realistic FIRE corpus for an Indian family?

For an urban Indian family with annual expenses of ₹12 lakh, a 25x-30x corpus would be ₹3 crore to ₹3.6 crore. However, with rising education and healthcare costs (medical inflation in India is often 10-12%), many aim for 40x-50x. This tool helps you calculate your 'FIRE target' based on your current city's cost of living (Tier 1 vs. Tier 2).

How do I handle healthcare costs in India after retiring?

Healthcare is a major out-of-pocket expense in India. Without employer-provided insurance, you must purchase a comprehensive private health plan. IRDAI-regulated plans for a family of four can cost ₹30,000-₹50,000 per year and increase with age. It is vital to include these premiums and a separate 'medical corpus' in your FIRE calculations.

Can I achieve FIRE with only SIPs?

Yes, Systematic Investment Plans (SIPs) in Mutual Funds are the most popular vehicle for FIRE in India. By automating your savings into equity funds, you benefit from rupee-cost averaging. This calculator shows how increasing your monthly SIP by just 10% every year (Step-up SIP) can reduce your time to financial independence by several years.

What is FIRE?

FIRE (Financial Independence, Retire Early) is a movement focused on extreme savings and investment to retire much earlier than the traditional age of 65. The goal is to accumulate enough that investment returns cover your expenses indefinitely.

The 4% Rule (25x Rule)

Based on the Trinity Study, the 4% rule suggests you can withdraw 4% of your portfolio annually with low risk of running out of money over 30+ years. This means you need 25x your annual expenses (1 ÷ 0.04 = 25).

Lean FIRE

Retirement on a tight budget, typically with expenses below the national average. Allows earlier retirement but with less room for luxuries or emergencies. Typically 50-70% of current expenses.

Fat FIRE

Retirement with a generous budget that maintains or exceeds your current lifestyle. Takes longer to accumulate but provides significant security and flexibility. Typically 150-200% of current expenses.

Coast FIRE

You have enough invested that compound growth alone will fund your traditional retirement at 65. You can "coast" - work just to cover current expenses without needing to save more.

Barista FIRE

Similar to Coast FIRE, but you continue working part-time (like as a barista) to cover expenses and potentially health benefits, while your investments grow.

Does the 4% rule still work?

The original study was based on historical US data. Many experts now recommend 3-3.5% for longer retirements (50+ years) or to be more conservative. The rule remains a good starting point.

What about healthcare and insurance?

This is one of the biggest challenges for early retirement. Consider: private health insurance, Barista FIRE for employer benefits, or moving to a country with public healthcare. Include healthcare costs in your retirement expenses.

What do I do after reaching FIRE?

Many people continue working on passion projects, volunteering, traveling, or spend more time with family. Financial independence is about having the choice - not necessarily about stopping work.