Data Sources
Our FIRE number calculations are based on official government data:
Bureau of Economic Analysis - Regional Price Parities (RPP)
Regional Price Parities measure the differences in price levels across states and metropolitan areas for a given year. An RPP of 100 represents the national average price level.
What RPP includes: The "all items" RPP we use combines prices for goods (groceries, clothing, vehicles), services (healthcare, transportation, utilities), and rents. Housing costs are captured through the rents component, which tends to drive much of the regional variation.
What RPP does not include: State and local taxes (income, sales, property) are not reflected in RPP. These can significantly affect actual cost of living - for example, Texas has no state income tax while California's top rate exceeds 13%.
- Source: BEA Regional Price Parities
- Data year: 2023
- Coverage: All U.S. metropolitan statistical areas (MSAs)
- Index type: All items (goods, services, and rents combined)
National Baseline Expenses
We use a baseline annual expense of $60,000 at the national average cost of living (RPP = 100). This represents spending for a single adult household including housing, food, transportation, healthcare, and other essentials.
- Source: Bureau of Labor Statistics - Consumer Expenditure Survey
- Why $60,000: Based on Consumer Expenditure Survey Table 1300 (2023), which reports $48,664 average annual expenditures for single-person consumer units. We round up to $60,000 (+23%) to provide a more comfortable baseline that includes buffer for: (1) healthcare costs that increase with age, (2) housing costs often understated in CES for homeowners, and (3) discretionary spending typical in early retirement. Users can adjust this baseline in the calculator.
Calculation Method
Each metro area's FIRE number is calculated in two steps:
Step 1: Adjust Annual Expenses
Annual Expenses = National Baseline × (RPP / 100)
Example: Atlanta has an RPP of 99.1
Annual Expenses = $60,000 × (99.1 / 100) = $59,460
Step 2: Apply Withdrawal Rate
FIRE Number = Annual Expenses × (100 / Withdrawal Rate)
Using 4% withdrawal rate (multiply by 25):
FIRE Number = $59,460 × 25 = $1,486,500
FIRE Types Explained
We calculate three variations of FIRE numbers to match different lifestyle goals:
Note: The Lean (80%), Regular (100%), and Fat (150%) expense multipliers are conventions that emerged from FIRE community discussions, not empirically-derived standards. They provide useful reference points but individual circumstances vary widely.
Lean FIRE
For those comfortable with a frugal lifestyle. Covers essentials with minimal discretionary spending. Best suited for people in low-cost areas or those with minimal lifestyle needs.
Lean FIRE = (Baseline × RPP/100 × 0.8) × 25 Regular FIRE
The standard FIRE target. Maintains a current lifestyle without significant upgrades or cutbacks. The most commonly referenced FIRE number.
Regular FIRE = (Baseline × RPP/100) × 25 Fat FIRE
For those wanting a more comfortable retirement with room for travel, hobbies, and unexpected expenses. Provides a larger safety margin.
Why 3% instead of 4%? Fat FIRE uses a more conservative withdrawal rate because higher spending leaves less room for error. The lower rate provides additional protection against sequence-of-returns risk and is often preferred by those planning for very long (40-60 year) retirements.
Fat FIRE = (Baseline × RPP/100 × 1.5) × 33 Assumptions
These calculations make several assumptions that may not apply to everyone:
- 4% Safe Withdrawal Rate: We use 4% because it's the most widely-recognized standard in retirement planning, based on the 1998 Trinity Study. However, that study assumed a 30-year retirement with historical U.S. market returns (1926-1995). For early retirees facing 40-60 year horizons, some researchers suggest 3.5% or lower may be more appropriate. The calculator allows adjusting this rate.
- Single Adult Household: The baseline assumes one person. Couples typically need less than 2x a single person's FIRE number due to shared housing, utilities, and other expenses. A rough estimate: multiply the single-person number by 1.5-1.7 for two people, though this varies by spending patterns.
- No Major Healthcare Expenses: The baseline includes typical healthcare costs but not significant medical conditions requiring expensive treatment.
- Renter Lifestyle: The baseline assumes renting. Homeowners with paid-off mortgages may need less.
- No Debt: Assumes all debt is paid off before retirement.
Limitations
Keep these limitations in mind when using our FIRE numbers:
No State/Local Tax Adjustments
RPP data doesn't account for differences in income taxes or property taxes, which can significantly impact actual expenses.
Metro-Level Averages
Large metro areas have significant variation. Living in downtown San Francisco costs more than the East Bay suburbs, even though both are in the same MSA.
Lifestyle Differences
Actual expenses depend heavily on lifestyle choices. Someone who rarely eats out will spend less than the average, regardless of location.
Inflation and Market Returns
These are point-in-time calculations. Actual retirement success depends on sequence of returns and inflation during the retirement years.
Update Schedule
We update our FIRE number calculations annually when the Bureau of Economic Analysis releases new Regional Price Parities data, typically in December for the prior year's data.
Current data year: 2023
Last updated: January 4, 2026