The quick calculation, month by month
The quick calculation steps month by month in current euros. The monthly contribution and the income wanted are entered in today's money and follow inflation. The portfolio grows at the return minus costs, and independence falls in the first month it passes the target capital, which is indexed too. On arrival, €60,000 to start, €1,200 a month, €2,400 net wanted, a 6% return, 2% inflation and 0.25% in costs give a target of €768,000 in today's money, reached after 25 years and 11 months.
Costs count twice: they reduce the return while saving, then the withdrawal rate once the capital is reached, since they keep being paid. At a 4% withdrawal rate and 0.25% in costs, the rate used is 3.75%. The same plan goes from 25 years and 11 months to 33 years and 3 months with 1% in costs, and to 51 years and 8 months with 2%.
Tax on withdrawals follows the country chosen, at 2026 rates read on each administration's website: none in Luxembourg for securities held more than six months outside a substantial holding, 10% above €10,000 per taxpayer in Belgium, 31.4% in France under the flat tax, 26.375% above €1,000 per person in Germany. Every euro withdrawn is counted as a gain, which overstates the tax, since part of each withdrawal is really capital. For €2,400 net wanted, the target becomes €823,704 in Belgium, €1,033,571 in Germany and €1,119,534 in France.
What the engine computes
The target capital is the annual retirement spend divided by the withdrawal rate. On the sample plan, €2,400 a month makes €28,800 a year, and a 4% withdrawal rate gives €720,000, which is 25 times the annual spend. The multiple follows the rate mechanically: 33.3 times at 3% (€960,000), 28.6 times at 3.5% (€822,857), 20 times at 5% (€576,000). Neither the return, nor the age, nor the starting balance enters that figure.
Everything else is computed in today's money. Each phase turns its nominal annual return and the plan's inflation into a real monthly rate: (1 + return) divided by (1 + inflation), then the twelfth root. With a 6% nominal return and 2% inflation, real growth is 3.92% a year and not 4%. At 5% it is 2.94%, at 4% it is 1.96%. That last one carries the retirement phase of the sample plan, against a much larger annual withdrawal.
Two figures are read against each other at the end. The coast-FI age is the age from which compounding alone, contributions stopped, would still reach the target capital by the start of retirement. The effective withdrawal rate is the annual retirement spend over the balance observed in the first month of that retirement: it states what the plan actually withdraws, where the entered rate states what it was aiming for.
Reading the figures on the page
The plan shown on arrival starts at age 32 with a €60,000 balance, 2% inflation and a 4% withdrawal rate, over three phases: 18 years of accumulation at €1,200 a month and a 6% return, 5 years of coast at 5%, then 35 years of retirement at €2,400 a month and 4%. The engine returns a €720,000 target capital, an FI age and a coast-FI age both out of reach, a 5.05% effective withdrawal rate and a balance exhausted around age 80.1.
The reason is visible on the curve. The balance peaks at €570,008 at age 55, in the first month of retirement, which is €150,000 short of the target capital. From there, withdrawing €28,800 a year is 5.05% of the balance while the phase returns only 1.96% in real terms, so the curve falls and the FI age stays out of reach. Past exhaustion the fifth tile stops showing a balance: it is relabelled as the cumulative shortfall at plan end and carries what the retirement asked for beyond what the portfolio could give, €314,697 here. It is not a debt actually taken on.
Each field moves that outcome legibly. Raising the accumulation contribution to €1,800 a month brings €785,706 at 55, a 3.67% effective withdrawal rate, an FI age of 52, a coast-FI age of 47.5 and €108,150 at the end. At €2,400 a month the balance reaches €1,001,404 at 55, the effective rate drops to 2.88% and the FI age to 47.6. The panels below layer more onto the same engine: dated events, assets and their loans, portfolio pockets, Luxembourg tax, scenario comparison, a Monte Carlo draw and a replay over a real series of annual returns. Several of those panels require a paid account; the five figures at the top are public.
What the model assumes
The deterministic curve applies a constant real return inside each phase. No volatility enters it: a year at minus 30% followed by a year at plus 30% does not act on a plan the way a smooth average does, and the engine does not simulate that here. The Monte Carlo draw, which replays 1,000 random paths, and the historical replay, which applies a series of annual returns supplied by the user, are what carry that question. The replay also refuses to stretch or repeat years to cover a plan longer than the series.
The withdrawal rule is fixed: the monthly spend entered is withdrawn every month of the retirement phase, with no adjustment to the portfolio's value. Inflation is already absorbed by working in today's money, so that spend stays the same spend for thirty-five years. Nothing in the model represents a state pension, salary progression, social contributions or a change in household situation.
Tax is off by default. Switched on, it applies the 2025 Luxembourg scale at the declared tax class, and charges only the tax the portfolio itself causes, that is the tax on other income plus the portfolio minus the tax on other income alone. The user declares what is taxable, pocket by pocket: the model does not infer a tax regime from a product name. Letting real euros meet a nominal scale assumes that scale stays indexed to inflation, which Luxembourg does periodically. The scale itself carries a note to verify against the ACD.
Frequently asked questions
Which withdrawal rate does the calculator apply?
4% by default, adjustable in the withdrawal rate field. It is used twice: it sets the target capital, annual spend divided by the rate, and it is compared against the effective withdrawal rate the engine measures at the start of retirement. The gap between the two is what the page shows best. With the sample plan brought down to €1,900 of monthly spend, the effective rate lands at exactly 4.00%, and the same engine still exhausts the balance at age 89.3, a few months short of the end of a 35-year retirement. At €1,800 a month, the effective rate is 3.79% and €43,087 is left at the end.
Why does the target capital change value on the date it is reached?
Because the quick calculation works in current euros. The €768,000 in today's money of the arrival plan, indexed at 2% a year for 25 years and 11 months, come to €1,280,950 in the month the portfolio passes them, and that capital then pays €4,003 a month at 3.75%, the purchasing power of €2,400 today. The curve is brought back to today's money: there the target stays a flat line.
How is the FIRE number computed?
The FIRE number, or target capital, is the annual spend of the retirement phase divided by the withdrawal rate. The engine reads only those two inputs to produce it: the return, the starting age, the opening balance and the length of the phases change nothing. €2,400 a month at 4% gives €720,000, €3,000 a month at 4% gives €900,000, and €2,400 a month at 3% gives €960,000. What the rest of the plan decides is the date the balance crosses that capital, not the capital itself.
Can a cross-border worker use it for retirement?
The projection itself carries no country: contributions, spending and returns are assumptions in today's money, and the result reads the same way for a Luxembourg resident and for a Belgian, French or German cross-border worker. The only localised element is the tax panel, off by default, which applies the 2025 Luxembourg scale. Pensions from several schemes are not modelled: they are entered as other income once retired, and the portfolio's tax is then computed on top of them. A bilateral tax treaty, a career split across two countries or an occupational pension fall outside what this calculation covers.
What assumptions does the displayed curve rest on?
Four, all visible on screen. Amounts are in today's money, so a €1,200 contribution keeps the same purchasing power for eighteen years. The real return is constant inside a phase, with no volatility. Withdrawals follow a fixed rule, with no adjustment to the portfolio. And tax is absent until it is switched on. The Monte Carlo draw and the historical replay exist precisely to test the second of those assumptions.
Why does the plan shown on arrival never reach independence?
Because its balance peaks at €570,008 at age 55, while its target capital is €720,000. The FI age is the age at which the curve crosses the target capital; here it does not cross it, so the field reads not reached, and so does the coast-FI age. That sample plan is a starting point to edit, not a typical path: raising the accumulation contribution from €1,200 to €1,800 a month is enough to produce an FI age of 52 and a positive end balance.