FI Number
The amount of invested assets you need so that a sustainable withdrawal covers your annual expenses — your financial-independence target.
Your FI Number is the size your portfolio needs to reach for you to be financially independent. The common rule of thumb is your annual expenses multiplied by 25, which is the inverse of a 4% withdrawal rate. If you spend $60,000 a year, the 25x rule puts your FI Number at $1.5 million.
The multiplier comes directly from your assumed safe withdrawal rate. A 4% rate implies 25x; a more conservative 3.5% rate implies roughly 28.5x; a 3% rate implies about 33x. Lower withdrawal rates mean a bigger target but more cushion against bad markets.
The FI Number is a planning anchor, not a guarantee. It assumes your expenses are estimated accurately and that future returns and inflation behave within historical ranges. It's a starting point for the conversation, not the end of it.
This definition is general information to help you understand a term, not financial, tax, or legal advice. Figures that change year to year (limits, thresholds, rates) should be confirmed against current official sources. For guidance on your situation, a licensed fee-only fiduciary is the right next step.