Before You Start
- Understand your current annual spending in EUR (€)
- Know the basics of investing and the FIRE (Financial Independence, Retire Early) movement
- Have access to a spreadsheet tool (Excel, Google Sheets, or LibreOffice Calc)
- Optional: Create a free account with a European broker (e.g. Trade Republic, DEGIRO, Scalable Capital) for future investing steps
Time needed: 30–60 minutes for your first calculation
What you'll need: Bank statements, calculator or spreadsheet, access to platform documentation if needed
The FIRE (Financial Independence, Retire Early) movement is gaining momentum across Europe, but most guides focus on US-based numbers and platforms. In this tutorial, you’ll learn exactly how to calculate your personal FIRE number in EUR for 2026—step by step, with real European examples, practical tools, and country-specific adjustments. If you want the full context, see our Complete 2026 Guide to FIRE in Europe, but this article is your deep dive into the calculation itself.
Step 1: Calculate Your Annual Expenses (in EUR)
What to do: Gather your last 12 months of spending data, ideally from your bank statements or a budgeting app. Add up all your essential and discretionary expenses, and adjust for any upcoming life changes (moving countries, children, etc.).
- Include: rent/mortgage, groceries, utilities, insurance, transport, healthcare, travel, hobbies, taxes, and any recurring costs
- Exclude: debt repayments (unless you plan to carry them into retirement), one-off purchases you don’t expect to repeat
Why it matters: Your annual spending is the backbone of your FIRE number. Underestimating leads to running out of money; overestimating means you might work longer than necessary.
What can go wrong: Missing hidden expenses (subscriptions, annual insurances), ignoring inflation, or not accounting for future healthcare or tax changes in your country.
EUR Example: Say you spend €2,200/month. That’s €2,200 x 12 = €26,400/year.
Pro Tip
Use a tool like Wallet or export transactions from your bank app. Categorize and sum your expenses in a spreadsheet for accuracy.
Step 2: Adjust for 2026 Inflation
What to do: Project your annual expenses to 2026 using expected inflation. In Europe, 2–3% annual inflation is a common estimate, but check recent data for your country (e.g., Eurostat).
- Formula: Future Expenses = Current Expenses × (1 + Inflation Rate)Years
Why it matters: The cost of living rises over time. If you ignore inflation, your FIRE number will be too low for future prices.
What can go wrong: Using too low or too high an inflation estimate. Not updating your number every year.
EUR Example: If your current annual expenses are €26,400 and you expect 3% inflation for 2 years (2024 to 2026):
- Future Expenses = €26,400 × (1.03)2 = €26,400 × 1.0609 ≈ €27,407
Pro Tip
In Google Sheets, use: =26400*(1.03^2) to get the inflated amount.
Step 3: Choose a Safe Withdrawal Rate (SWR) for Europe
What to do: Select a withdrawal rate (the % of your portfolio you plan to withdraw each year). The US “4% rule” is often cited, but in Europe, many use 3.5% or even 3% for extra safety due to lower expected returns and different tax regimes.
- Common options: 3%, 3.5%, 4% (lower is safer, but means you need a bigger portfolio)
- Consider: your country’s tax on capital gains/dividends, pension system, and whether you’ll have public healthcare
Why it matters: This rate determines how much you can safely withdraw each year without running out of money, based on historical market returns and volatility.
What can go wrong: Using an unrealistically high SWR, or ignoring taxes and fees (see our ETF cost guide for details).
EUR Example: Let’s use a conservative 3.5% SWR for Europe.
Pro Tip
Check your country’s tax authority for current rates: for example, France (flat 30% “prélèvement forfaitaire unique” on gains), Germany (26.375% Abgeltungsteuer), or Spain. Adjust your SWR down if taxes are high.
Step 4: Calculate Your FIRE Number in EUR
What to do: Divide your inflation-adjusted annual expenses by your chosen withdrawal rate.
- Formula: FIRE Number = Annual Expenses / SWR
- Enter this in your spreadsheet for automatic calculation
Why it matters: This is the total portfolio you need—invested in EUR, ideally in globally diversified ETFs—to safely cover your living expenses for decades.
What can go wrong: Forgetting to use post-tax expenses, or not updating for new life circumstances.
EUR Example: Using €27,407 (from Step 2) and a 3.5% SWR:
- FIRE Number = €27,407 / 0.035 = €782,771
Pro Tip
Want to automate? Try our recommended calculators in Best FIRE Calculators for European Investors: 2026 Review. They offer EUR support and country-specific features.
Step 5: Download & Use a Spreadsheet Template
What to do: Download this ready-to-use FIRE Number Calculator Europe 2026 Template (Google Sheets). Make a copy to your own account and fill in your expenses, inflation rate, and SWR. The formulas will update your FIRE number automatically.
Why it matters: Spreadsheets make it easy to tweak variables, test different scenarios, and keep your plan updated each year.
What can go wrong: Forgetting to make your own copy (so you can’t edit), or entering expenses in the wrong cells.
Expected outcome: You should see your personalized FIRE number in EUR for 2026, ready to review or adjust as your life changes.
Step 6: Adjust for Country-Specific Factors (Healthcare, Taxes, Pensions)
What to do: Consider any unique costs or benefits in your country:
- Healthcare: Will you need private insurance after retiring? For example, in Germany, voluntary public or private health insurance may cost €400–€700/month per adult.
- Taxes: Some countries tax capital gains and dividends heavily. Use post-tax withdrawal rates.
- Pensions: Will you receive a state pension at a certain age? You can plan for a lower withdrawal rate after that point.
Why it matters: European countries differ widely in these areas. Not factoring them in can derail your FIRE plan.
What can go wrong: Assuming you’ll have “free” healthcare everywhere, or ignoring local tax treaties and pension rules.
EUR Example: If you move from Germany to Portugal (NHR regime), your tax on foreign passive income may drop to 0–10%. This could allow a higher SWR and a lower FIRE number.
Pro Tip
Simulate “geo-arbitrage”: Try entering expenses for both your current country and a lower-cost EU country in the spreadsheet. See how much your FIRE number drops if you move post-retirement.
Step 7: See Two Real EUR-Based Example Calculations
Example 1: Single Professional in France
- Annual expenses (2024): €30,000
- Inflation (2024–2026): 2%/year → €30,000 x 1.0404 = €31,212
- Withdrawal rate: 3.5% (due to 30% tax on gains/dividends)
- FIRE Number: €31,212 / 0.035 = €891,771
Example 2: Couple With Child in Germany
- Annual expenses (2024): €42,000
- Inflation (2024–2026): 3%/year → €42,000 x 1.0609 = €44,758
- Withdrawal rate: 3% (to allow for private healthcare and higher taxes)
- FIRE Number: €44,758 / 0.03 = €1,491,933
Both examples assume no additional income (e.g., side hustles, rental properties) and are pre-tax. Adjust as needed for your situation.
Common Mistakes
- Underestimating expenses: Not accounting for one-off or rising costs (e.g., child expenses, healthcare, home repairs)
- Using the wrong withdrawal rate: Applying the 4% US rule without adjusting for European taxes and lower expected returns
- Ignoring inflation: Calculating your FIRE number based on today’s prices, not 2026’s
- Forgetting country-specific factors: Not including mandatory health insurance or local taxes in your calculations
- Not updating your plan: Failing to adjust as your life and the economy change
Next Steps
- Download and personalize the FIRE Number Calculator Europe 2026 Template
- Compare different withdrawal rates and inflation scenarios in your spreadsheet
- Research the best FIRE calculators for European investors for more automation and scenario modeling
- Start building your investment portfolio (consider platforms like Trade Republic, DEGIRO, or Scalable Capital—all EUR-based and accessible across Europe)
- For a full FIRE roadmap, see our Complete 2026 Guide to FIRE in Europe
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.