Financial independence calculator

What this calculator does

It answers one question: if you keep saving at your current rate, when does work become optional? You give it four numbers: what you earn, what you spend, what you have already invested, and the return you expect. It hands back your savings rate, your FI number (the pot big enough that your investments could pay for your life), and the year the two lines on the chart cross. FI stands for financial independence. It is not about never working again; it is about the salary becoming a choice.

How this calculator works

Your FI number is your annual spending divided by a safe withdrawal rate, the research convention for how much a portfolio can pay out each year without a high risk of running dry. The rate is set per market (more conservative for the eurozone) and it is an assumption, not a law of nature; small changes to it move the target a lot. The projection then takes what you have, adds what you save each year (income minus spending), compounds the lot at your chosen return, and marks the year the pot crosses the target.

The assumptions you should know about: the return is applied as one steady annual rate, while real markets lurch about; your income and spending are treated as frozen from today onwards; and inflation is only handled if you enter a return net of it (a real return, in the jargon). Type in a gross return and the answer will flatter you.

When to use it (and when not)

Use it to see which lever moves the date. Spending less does double duty: it raises your savings rate and shrinks the pot you need, which is why it beats a pay rise of the same size. Run it once a year, not once a week. And do not read the result as a countdown clock; a projection decades out is a compass bearing, not a delivery date.

This calculator is educational, not financial advice, and it names no product or provider. The projection is illustrative: it applies the steady return you chose, and markets do not move in straight lines. Investment values can fall as well as rise, and you could get back less than you put in. Actual returns depend on the funds you choose, their performance, and the charges you pay. For decisions about your own money, talk to a regulated adviser in your market.