FI Calculator: Financial Independence on Tech Salaries

Every engineer I've worked with wants to build a model before making a decision. So when tech workers ask me for a financial independence calculator tech teams can actually trust, I get it. You want the spreadsheet. You want the inputs, the assumptions, the sensitivity analysis. Problem is, most FI calculators floating around the internet were built for someone earning $85,000 a year with a flat salary curve and no equity comp. That's not you. If you're a senior engineer at a company with a stock price that swings 40% a year, or you've got RSUs vesting on a quarterly cliff, the generic calculator gives you a fake number dressed up as a real one.

I spent a decade at Coinbase before I left to build Portfolio Medics, and I've watched smart people make bad decisions because their financial independence number was built on assumptions that don't hold for tech comp. Let's fix that.

Understanding Your Financial Independence Number

Your FI number is the amount of invested assets that can theoretically sustain your annual spending indefinitely. The classic formula: take your annual expenses, multiply by 25. That comes from the old 4% rule, and it's simple enough to fit on a napkin.

Here's the problem. The 4% rule was built on Bill Bengen's research using historical U.S. market data from 1926 to the 1990s (Bengen's original paper is worth reading if you like your finance with actual math in it). It assumed a 30-year retirement horizon. It assumed a portfolio mix of large-cap stocks and intermediate bonds. It did not assume you're 34 years old, retiring after your company's IPO, with a 50-year time horizon ahead of you and a chunk of net worth sitting in a single volatile stock.

We wrote a whole piece on why the 4% rule sets tech professionals up for retirement failure if you want the full argument. Short version: a 50-year retirement needs a different withdrawal assumption than a 30-year one, and concentrated equity positions change your risk profile in ways the original research never touched.

So your real FI number isn't "expenses times 25." It's expenses times a multiple that reflects your actual time horizon, your actual asset mix, and your actual tolerance for a bad sequence of returns in year three of early retirement. For most tech workers I work with, that number ends up higher than the napkin math suggests. Sometimes by a lot.

The Two Numbers That Actually Matter

Forget one FI number. Track two.

Your Coast FI number is the amount where, if you stopped contributing entirely today, compound growth alone would get you to a full retirement number by a normal retirement age. Hit Coast FI and you've got options: downshift to a lower-stress role, go part-time, take the startup job that pays less but that you actually want.

Your Full FI number is the one that lets you stop working entirely, on your terms, whenever you want. That's the expenses-times-multiple number, adjusted for your real circumstances.

Most engineers I talk to have never separated these two. They're demoralized because Full FI feels ten years away, when Coast FI might be two years away and would change how they think about every job decision between now and then.

Factoring in Tech Salary Growth and Equity

Here's where generic FIRE calculators fall apart completely for tech workers, and it's the single biggest gap I see in DIY financial independence planning.

A software engineer's income doesn't grow like a schoolteacher's. It grows in steps. You get a promotion and your base jumps 15%. You switch companies and your total comp jumps 40% because the market for your skills moved. You get a refresher grant two years in that resets your equity clock. None of this fits neatly into a calculator that assumes 3% annual salary growth compounding smoothly forever.

Equity comp is the bigger issue, though. RSUs vest on a schedule, usually a one-year cliff followed by quarterly or monthly vesting after that. That means your actual liquid net worth doesn't grow in a straight line. It grows in chunks, and those chunks are taxed as ordinary income the moment they vest, whether you sell or hold. If you're modeling your FI timeline based on your total comp number from the offer letter, you're modeling a number that assumes the stock price never moves and every grant vests exactly as scheduled. Neither of those things is guaranteed.

A few things I tell clients to build into their planning:

• Model your equity conservatively. If your stock has run up 200% in the last two years, don't extrapolate that forward. Use a flat or modest growth assumption for planning purposes, even if you're personally bullish.
• Separate "vested and liquid" from "unvested and hypothetical." Your FI number should be measured against assets you actually control, not a projection of unvested grants at current share price.
• Plan for refresh grants, but don't count on them. Comp committees change philosophy. Grant sizes shrink after a stock run-up. Don't build your FI date around a fourth-year refresher that hasn't been granted yet.
• Watch the concentration. If a single employer's stock is more than 10-15% of your net worth, you don't have a diversified portfolio, you have a bet. A good FI calculator accounts for the extra risk premium that concentration requires, meaning your effective FI number should probably be higher until you diversify.

I've seen engineers hit their "number" on paper during a stock run-up, quit, and then watch 30% of their net worth evaporate in the next drawdown because their FI number was built on a share price that didn't survive contact with reality. Don't be that person. Build in a haircut.

Adjusting for High Cost of Living Areas

If you're in the Bay Area, Seattle, or increasingly Denver and Austin, your FI number has to reflect where you actually live, and more importantly, where you plan to live once you stop working.

This matters more than people think. A $2.5 million FI number in San Francisco might be a $1.5 million FI number in Minneapolis. That's not a small rounding error, that's years of your working life. We work with a lot of tech families based here in Minnesota, including plenty who relocated from the coasts specifically because the math works better, and we've written about the financial planning considerations for software engineers in Minnesota if that's relevant to your situation.

The calculator question you actually need to answer isn't "what does it cost to live where I am now." It's "where will I be spending money during the 40+ years I'm not working." If you're planning to stay in a high cost of living metro permanently, your number needs to reflect that fully, including the property tax and healthcare cost trajectory in that specific state. If you're planning to relocate after FI, geographic arbitrage can meaningfully lower the number you need to hit, but only if you actually do it and don't just tell yourself you will.

Be honest with yourself here. I've seen plenty of plans built around "we'll move somewhere cheaper" that never happen because kids are in school, or family's nearby, or you just genuinely like your life where it is. That's fine. Just don't calculate your FI number as if you're moving to Boise if you know deep down you're not.

Safe Withdrawal Rate Considerations

The 4% rule gets treated like scripture in FIRE circles, and it shouldn't be. It's a starting point, not a law of physics.

The original Bengen research used a 30-year time horizon. If you're retiring at 62 after a full career, that's roughly appropriate. If you're retiring at 38 after your company's acquisition, you're looking at a 50-plus-year time horizon, and a fixed 4% withdrawal rate has a meaningfully higher failure rate over that longer stretch, according to later research including the Trinity Study updates and subsequent Monte Carlo work.

For early retirees, I generally think a more conservative starting withdrawal rate, somewhere in the 3% to 3.5% range depending on your actual asset allocation, is a more sensible planning assumption. That's not a magic number either. It's directionally more appropriate for a longer time horizon and it gives you a bigger cushion against a bad sequence of returns hitting early in retirement, which is historically the biggest killer of early retirement plans (a bad market in year two of a 50-year retirement does far more damage than the same bad market in year twenty).

A dynamic withdrawal strategy, one that flexes spending down in bad years and up in good ones, generally outperforms a fixed percentage in terms of not running out of money. It's harder to model in a simple calculator and harder to live with psychologically (nobody loves cutting their spending in a down year), but it's the more honest approach if you're serious about a multi-decade retirement horizon.

Tracking Progress and Milestone Planning

Once you've got a real number, ditch the vague dread and start tracking milestones. This is the part engineers actually enjoy, because it turns an abstract fear ("will I ever have enough") into a dashboard you can check.

Break your FI number into checkpoints. 25% of FI. 50%. Coast FI, wherever that lands. 75%. Full FI. At each checkpoint, something changes about what's actually possible for you, and that's worth marking. Hitting 50% of FI with 15 years of working years left behind you feels very different from hitting 50% with 25 years left, even though the dollar number is identical. Track the trajectory, not just the balance.

Watch your savings rate as closely as your net worth. Net worth is noisy in the short run, it moves with the market whether you did anything right or wrong that quarter. Savings rate is the number you actually control. A tech worker saving 40% of after-tax income is going to hit financial independence dramatically faster than one saving 15%, regardless of who has the better stock picks. If you want a deeper look at how the broader FIRE movement approaches this, especially in a lower cost of living context, we've written about early retirement and the FIRE movement here in Minnesota.

Revisit the calculation annually, not daily. I mean this. Checking your FI progress every day is a great way to make yourself miserable and make bad decisions during a drawdown. Once a year, sit down, update the real numbers, adjust the plan. That's plenty.

Updating Your FI Plan as Circumstances Change

Your FI number isn't a tattoo. It's a living model, and it should change as your life does.

A new kid changes your spending assumptions and probably your risk tolerance. A divorce changes almost everything. A layoff (and let's be honest, tech has had a lot of those since 2022) can accelerate or delay your timeline depending on the severance and how fast you land the next role. A big acquisition or IPO can hand you a windfall that moves your FI date forward by years, but only if you don't immediately inflate your lifestyle to match the new number on your net worth statement.

The mistake I see most often isn't people failing to build a plan. It's people building one plan in their late 20s and never touching it again, running their life off assumptions that stopped being true a decade ago. Markets change. Tax law changes. Your own goals change, and that's not a failure, that's just being a person whose life evolved. The plan needs to evolve with it.

This is really the difference between a calculator and actual planning. A calculator gives you a number today, based on today's inputs. Planning is the discipline of updating that number as your life changes, and making decisions today that account for a range of futures instead of just the one spreadsheet assumed.

If you want to see how this fits into a full financial picture, not just a single FI number floating in isolation, take a look at our financial planning services or check out who we typically help, which includes plenty of tech professionals working through exactly this kind of planning.

Get an FI Number Built for Your Actual Life, Not a Generic Spreadsheet

A calculator can give you a starting estimate. It can't account for your specific equity structure, your risk tolerance for concentrated stock, your real geographic plans, or what a 50-year retirement horizon actually does to a safe withdrawal rate. That takes an actual conversation, and it's exactly the kind of work we do for tech professionals every day at Fireweed Capital.

If you want help building a financial independence number that reflects your actual comp structure, your actual risk profile, and your actual life, not a napkin calculation borrowed from someone else's career, schedule a consultation and let's build the real version together.