Before You Start
- Basic familiarity with Excel (entering formulas, formatting cells)
- Understanding of your household’s monthly income, expenses, and savings rate in EUR
- Estimate of your expected annual investment return (after fees and taxes) and inflation rate for your country
- Access to a computer with Microsoft Excel (2016 or newer) or free alternatives like LibreOffice Calc or Google Sheets
Time needed: 45-60 minutes
What you'll need: Excel (or equivalent), your financial numbers, optionally a brokerage account (e.g., Trade Republic, DEGIRO) to check real ETF data
Building a custom FIRE calculator Europe edition in Excel is one of the most empowering steps you can take on your path to financial independence. Instead of relying on generic US-based tools, you’ll create a model tailored for EUR, European tax rates, and inflation realities. This guide gives you a step-by-step process (with downloadable template) to understand your own FIRE number, using real-world scenarios from Germany, France, and the Netherlands.
If you’re new to the FIRE movement, read our FIRE Movement Explained: How to Retire Early for a complete introduction.
Step 1: Set Up Your Excel Workbook
What to do:
- Open Excel (or Google Sheets/LibreOffice Calc).
- Save your file as FIRE Calculator Europe.xlsx.
- Label your first sheet “Inputs”.
Why this matters: Keeping inputs separate from calculations makes your model flexible. You’ll be able to update your numbers easily without breaking formulas.
What can go wrong: Mixing input and formula cells can cause accidental overwrites. Always color-code input cells (e.g., light yellow fill) for clarity.
Step 2: Enter Your Key Inputs
What to do: In the “Inputs” sheet, create a table like this:
| Annual net income (€) | [Your value] |
| Annual expenses (€) | [Your value] |
| Current savings (€) | [Your value] |
| Annual savings rate (%) | [Your value] |
| Expected annual investment return (%) | [Your value] |
| Expected annual inflation (%) | [Your value] |
Example for Germany:
Annual net income: €48,000
Annual expenses: €30,000
Current savings: €25,000
Annual savings rate: 37.5% (=(Income-Expenses)/Income)
Expected annual investment return: 5%
Expected annual inflation: 2.5%
Why this matters: These are the variables that drive your FIRE journey. Using EUR ensures the results are realistic for your life in Europe.
Pro Tip
Use your most recent tax return or payroll statement for accurate net income. For investment return, check MSCI World Index factsheets for historical returns, but always adjust for local taxes and fees.
Step 3: Calculate Your FIRE (Financial Independence) Number
What to do: In a new sheet called “FIRE Number”, reference your annual expenses and calculate:
- FIRE Number = Annual Expenses × 25 (assumes 4% safe withdrawal rate)
In Excel, enter:
=Inputs!B2*25 (assuming Annual Expenses is in cell B2 of Inputs)
Why this matters: The 4% rule is a widely used starting point, but in Europe, consider adjusting for higher taxes or lower expected returns. The “25x” multiplier assumes you can sustainably withdraw 4% of your portfolio per year.
What can go wrong: Using gross (pre-tax) expenses will overestimate your number. Always use net (after-tax) spending.
Example: If your annual expenses are €30,000, your FIRE Number is €750,000.
Pro Tip
Want to be more conservative? Use a 3.5% withdrawal rate (multiply expenses by ~29) if you expect lower returns or want extra safety.
Step 4: Model Investment Growth and Time to FIRE
What to do: In a new sheet called “Projection”, set up the following columns:
- Year
- Starting Portfolio (€)
- Annual Savings (€)
- Investment Growth (€)
- Ending Portfolio (€)
- Adjusted FIRE Number (for inflation) (€)
For Year 0 (today):
- Starting Portfolio: =Inputs!B3
- Annual Savings: =Inputs!B1 - Inputs!B2
- Investment Growth: =Starting Portfolio × (Expected Return %)/100
- Ending Portfolio: =Starting Portfolio + Annual Savings + Investment Growth
- Adjusted FIRE Number: =Inputs!B2 × 25 × (1 + Inflation Rate)^Year
Drag formulas down for 40 years (or until Ending Portfolio >= Adjusted FIRE Number).
Why this matters: This projection lets you see how many years it will take to reach FIRE, accounting for compounding and inflation.
What can go wrong: Forgetting to increase FIRE Number for inflation will underestimate your target. Also, remember to apply investment return only to the portfolio, not to new savings that are added at year-end.
Step 5: Try Country-Specific Scenarios
Let’s see how this works in practice for three European countries. Use realistic numbers for each:
Germany Example
- Net income: €48,000
- Expenses: €30,000
- Savings: €25,000
- Investment return: 5%
- Inflation: 2.5%
Result: At a €18,000 annual savings rate, it takes ~17 years to reach an inflation-adjusted FIRE number of €1,050,000 (after 2.5% inflation per year).
France Example
- Net income: €38,000
- Expenses: €27,000
- Savings: €20,000
- Investment return: 4.5%
- Inflation: 2.2%
Result: At a €11,000 annual savings rate, it takes ~27 years to reach an inflation-adjusted FIRE number of €875,000.
Netherlands Example
- Net income: €52,000
- Expenses: €32,000
- Savings: €30,000
- Investment return: 5.2%
- Inflation: 2.8%
Result: At a €20,000 annual savings rate, it takes ~15 years to reach an inflation-adjusted FIRE number of €1,150,000.
For more on country-specific challenges, see FIRE in Europe: How to Retire Early Despite High Taxes and Inflation.
Step 6: Download and Customise the Template
To save time, you can download a ready-to-use Excel template (link at the end of the article). Update the yellow cells with your numbers and review the projections. Tweak the assumptions (returns, inflation, withdrawal rate) to see how your timeline changes.
Why this matters: Customisation makes the tool relevant to your life and country, not just generic averages.
Step 7: Test Different Scenarios and Next Actions
What to do: Try changing:
- Your savings rate (can you increase it?)
- Expected investment returns (try both optimistic and pessimistic scenarios)
- Inflation rate (especially if you’re planning for 20+ years)
- Withdrawal rate (3.5% vs. 4%)
Update your plan as your life changes: new job, moving country, starting a family, or adding a side hustle.
Pro Tip
Use European brokers like Trade Republic or DEGIRO to set up monthly ETF investments. In Trade Republic, tap Portfolio → Savings Plan → Select ETF (such as iShares Core MSCI World UCITS ETF, ISIN: IE00B4L5Y983), and automate your savings as per your FIRE plan.
Common Mistakes
- Forgetting to adjust your FIRE number for inflation—this can lead to a shortfall after 10-20 years.
- Overestimating investment returns and underestimating taxes/fees. Always check your country’s capital gains tax rules.
- Using gross income or expenses instead of net (after-tax) numbers.
- Not updating your calculator regularly as your income, expenses, or market conditions change.
- Assuming the 4% rule is universal—Europe’s higher taxes and lower returns may require using a 3.5% withdrawal rate for safety.
Next Steps
- Download the Excel template and input your actual numbers to see your timeline to FIRE.
- Read How to Use a FIRE Calculator for Early Retirement Planning in Europe for tips on interpreting your results and adjusting your plan.
- If you have a family, review Is the FIRE Movement in Europe Realistic for Families? for specific considerations.
- Revisit your plan each year, updating for real investment returns and changes in your expenses or goals.
- For more on the philosophy and different paths to FIRE, start with FIRE Movement Explained: How to Retire Early.
Disclaimer: This article is for educational purposes only and does not constitute financial advice. Always do your own research and consider consulting a qualified financial advisor before making investment decisions.