The 25× rule says you can retire when your invested assets equal 25 times your annual expenses — based on the 4% safe withdrawal research.
If you spend $50,000 per year, your FI number is $1.25M. The rule isn't gospel, but it is a useful North Star for planning.
Two levers move the date dramatically: increasing your savings rate and reducing your expenses (which lowers the target itself).
Key takeaways
- FI number ≈ annual expenses × 25.
- Cutting expenses lowers both the timeline and the target.
- Savings rate is the most powerful single lever.
Apply it with these calculators
Written and reviewed by
Keiron Brown, Psy.D.
Founder & Lead Educator, CalculatingWealth
Keiron Brown, Psy.D., is a clinical psychologist and the founder of Relationale LLC, which publishes CalculatingWealth. His doctorate is in psychology, not finance: he is not a registered investment adviser, accountant, or attorney, and nothing here is financial, investment, tax, or legal advice. His work here focuses on financial education, critical thinking, and decision-making — helping people understand the math behind money so they can plan with clarity and confidence. He writes about wealth building, retirement planning, investing literacy, budgeting, and the behavioral patterns that shape long-term financial outcomes.
Editorial standards: All educational content on CalculatingWealth is reviewed for accuracy, sourced from primary references where applicable (IRS, SSA, Federal Reserve, BLS), and updated when rules or rates change. Content is for educational and informational purposes only and does not constitute financial, investment, tax, or legal advice.
Not advice: Keiron Brown is not a registered investment adviser, broker-dealer, certified public accountant, enrolled agent, attorney, or licensed insurance producer. His work is educational in nature. See our full disclaimer.