FIRE Number: Your Financial Independence Target

FIRE = Financial Independence, Retire Early. Your FIRE number is the corpus at which you can stop working forever, your portfolio returns cover all expenses. In India with 6% inflation: the magic multiple is 30×, not the US standard 25×.

Why 30× not 25×: US FIRE uses 25× (4% withdrawal). India has 6% inflation vs 2% in US. Portfolio needs to return 10%+ to sustain. 30× = 3.3% withdrawal rate. Safer for Indian context. The real FIRE trap: Lifestyle inflation. If expenses grow post-FIRE (kids' education, health costs, travel), corpus depletes faster. Build 35× for comfort buffer. Tax-efficient FIRE withdrawal: Withdraw from equity MF: ₹1.25L LTCG/year exempt. Spread withdrawals across spouses. SGB interest taxable but maturity exempt. Dividend from stocks at slab rate, avoid. Lean FIRE vs Fat FIRE: Lean FIRE: minimal expenses, early target. Fat FIRE: same lifestyle forever, bigger corpus. India Fat FIRE at ₹1L/month expenses = ₹3.6Cr corpus (at today's value). 4% Rule (adapted): Original: withdraw 4% of corpus annually (US). India adaptation: use 3.3-3.5% withdrawal rate due to higher inflation (6% vs 2%).