Description

How your Calculator works

Just enter all the income streams you expect to have for Early Retirement (Barista FIRE) and regular retirement. Then enter the desired income you need to have and maybe a buffer on top. Now, you‘ll get your retirement gap. Next, you can scan the money you can withdraw from your portfolio and get a passive income right into your bank account – in early retirement and regular retirement.

What makes the difference is the withdrawal rate you will use when you decide for Barista F.I.R.E.. See how your portfolio grows with a variable and a fixed withdrawal rate. Using a fixed withdrawal rate means to always withdraw after that rate like 4 %. That results in wild swings of your withdrawals over time. Using a variable withdrawal rate means to always cover your early retirement gap and nothing more.

In the tool your ideal variable withdrawal rate is calculated based on your desired withdrawal. Typically, after 30 years you end up with a stock market portfolio that is much bigger than if you would have used a fixed withdrawal rate. Last you see how long it will take you until you accumulated enough capital to achieve traditional (early) retirement.