FatFIRE: Reach Financial Independence In Style! (With Calculator)

FatFIRE is one of several Financial Independence Retire Early (FIRE) types.

FatFIRE is a higher-spending version of FIRE, where individuals aim for a minimum annual spending budget of $100,000 or more in retirement, which means you would need a portfolio of at least $2.5 million.

This allows you to live an upper/middle-class lifestyle after early retirement.

Let's explore FatFIRE as a route to financial independence and see if it's right for you.


What Is FatFIRE?

Fat FIRE means when you retire early with a higher standard of living.

A general definition is having enough money to spend at least $100,000/year in retirement.

Following the 4% rule would mean having a portfolio of at least $2.5 million.

FatFIRE enthusiasts aim for a minimum annual spending budget of $100,000 or more in retirement, compared to the $40,000 to $60,000 range typically associated with traditional FIRE.

This allows you the freedom to spend budgeting or embracing frugality.

You can spend free and live your best life!

This type of FIRE appeals to many people because you don't have to sacrifice the luxuries of life.

It also gives you peace of mind to know you have more wiggle room in case life throws you a curveball.

While no set minimum net worth is required to be considered FatFIRE, individuals often aim for a net worth of $2 million or more.

This level of net worth can provide a higher degree of financial security and flexibility in retirement.

This gives you the ability to withstand market volatility and unexpected expenses.


Your FatFIRE Number

To find your FatFIRE number, you need to know how much you would like to spend each year in retirement.

The amount you need would include all expenses, discretionary spending, and luxuries.

This is usually enough money to live without budgeting or cutting coupons.

You can start by determining how much you spend each year and adding your expected luxuries.

I use Personal Capital to track my expenses. (Get a $20 Amazon Gift Card with this link when you add at least one investment account containing a balance of more than $1,000 within 30 days)

The formula to calculate your FatFIRE number is almost the same as regular FIRE.

Your FatFIRE number will be larger.

The number is larger because you are including yearly expenses plus luxury spending.

Vacations, dining out, nicer cars, and fancier clothes are all options with FatFIRE.

So instead of yearly expenses, the formula uses your desired yearly spending.

FatFIRE Number = 25 x (Desired Yearly Spending)

Let's say after using Personal Capital, you find a comfortable yearly spend is $100,000/year.

Then your calculation would look like this:

$2.5 Million = 25 x ($100,000)

This means that once you accumulate $2.5 million, you can withdraw $100,000 yearly.

This 4% withdrawal rate comes from “The Trinity Study.”

So in this example, once you accumulate $2.5 million, you will have reached Fat FIRE. 

FatFIRE is subjective, depending on your lifestyle and desired amount of spending.

Some might feel comfortable with $100,000/year, while others need $150,000.

The appeal of FatFIRE is being able to enjoy the luxuries of life and still retire early.


Calculating FatFIRE

Calculating FatFIRE will depend on two factors:

  1. Yearly Spending In Retirement
  2. Current Savings Per Year

We now know how to estimate our yearly spending.

The next step is to estimate your savings rate.  This is how much you invest each year.

These two values will tell you how long it will take to reach FatFIRE.

I recommend using my FIRE calculator because it shows your progress year by year.

This way, you can identify when you will arrive at Fat FIRE.

JL Collins FIRE Calculator

Calculate Your Fat FIRE Number With My Free Fat FIRE Calculator

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My FatFIRE calculator helps you determine when you will reach your FatFIRE amount.

The FIRE calculator accounts for how much you've saved and the amount you are contributing.

Here Is An Example: 

  • Yearly Spending In Retirement ($100,000)
  • Current Savings Per Year ($74,000)


FatFIRE Number = (25 x Yearly Spending)

$2.5 Million = (25 x $100,000)

Fat FIRE Number = $2.5 Million

Now we use the FIRE calculator to determine when we will reach this amount.

It will take longer than regular FIRE.

FatFIRE Calculation

In this example, saving $74,000/year would take 18 years to accumulate $2.5 million.

This is with 7% returns each year.

You can adjust the numbers to fit your situation or preferences best. 


Benefits of Fat FIRE

A More Lavish Lifestyle

Fat FIRE gives you the freedom to live the lifestyle you want.

You can live a rich lifestyle, care for your family, or have more peace of mind.

Learn more about the difference between the Rich vs Wealthy.

Giving To Charity

Having such a large nest egg puts you in a position to donate to a charity you feel is doing important work.

Furthering a cause you care about and improving the world can be fulfilling! 

If having the extra money to give if you feel inclined appeals to you, then FatFIRE might be the right FIRE path.

Ability To Leave A Legacy

Another benefit of FatFIRE is passing the wealth on to your children if you don't spend it all.

While pursuing FatFIRE, you might realize you over-saved, which is a good problem. 

In this case, you can always pass the money on to the next generation and leave a legacy.

This would help provide financial security to your family for generations.


Different Types Of FIRE

The FIRE movement is growing and now has many types of FIRE.

Here are the different types of FIRE in order from easiest to hardest to achieve:

  • CoastFIRE (Coast FIRE)
  • BaristaFIRE (Barista FIRE)
  • LeanFIRE (Lean FIRE)
  • TraditionalFIRE
  • FatFIRE (Fat FIRE)

Each type of FIRE has pros and cons and comes down to balancing money and work.  

  • Coast FIRE is having enough invested to stop contributing and still reach FIRE in the future.
  • Barista FIRE is working part-time for supplemental income or health insurance.
  • Lean FIRE is the minimalist way of reaching FIRE and means retiring with a “lean” budget.
  • Traditional FIRE is retiring early after accumulating 25 times your annual expenses.
  • Fat FIRE is having a large amount of money to retire early

This gives us options to pursue the type of FIRE that best matches our lifestyle goals.

Here Is An Illustration I Made To Remember The Different Types Of FIRE:

FatFIRE Graphic



The primary difference between FatFIRE and LeanFIRE is the amount of money needed each year during early retirement.

They are two different extremes.

LeanFIRE is a barebones type of FIRE.

FatFIRE is retirement with much more wiggle room in the budget. 

Lean FIRE is best defined as the minimalist way of reaching FIRE.  It involves retiring with a “lean” budget.

FatFIRE is best defined as having a large amount of money to retire early


  • Easier Path To FIRE
  • Involves Embracing Frugality
  • Living On Less (< $40,000/year)


  • Hardest Path To FIRE
  • More Luxurious Lifestyle
  • Living On $100,000/Year Or More


Negatives of Fat FIRE

A clear negative of Fat FIRE is the need to continue working while accumulating more money.

The risk is working longer than necessary and later realizing you didn't need as much money as you thought you did.

This person could have retired years earlier. 

FatFIRE also doesn't rely on a budget or frugality, so there is a risk of lifestyle creep.

The more you make, the more you might think you need.

It's an interesting phenomenon called Hedonic Adaptation.

You should ensure the amount you plan to need in retirement is accurate.

If you are a frugal person by nature, then FatFIRE might not be the best option.


Fat FIRE Financial Independence

As you can see, you can reach FIRE in various ways.

Fat FIRE is by far the most challenging path to financial independence.

However, this can end up being an advantage.

If you strive for FatFIRE and don't reach it, you'll likely still be in a good place.

“Shoot for the stars, so if you fall you land on a cloud” – Kanye West

Finally, if you enjoy your job, you might not rush to reach financial independence.

In this case, FatFIRE might be the best option.

If you are miserable, it might be wise to pursue a more leisurely FIRE like Lean FIRE, CoastFIRE, or BaristaFIRE.