Want to get financial freedom? Take practical advice from this man who retired at 30

For those who aspire to retire early and embrace financial independence, we have a solution. 

The coveted secret lies in the FIRE movement. The concept of a "FIRE number" is a key stepping stone towards achieving the dream retirement. 

I repeat that the elusive "FIRE number" is your magic ticket to financial freedom.

In a world where retirement with comfortable freedom from financial woes often seems like a distant dream, the FIRE movement offers a concrete path to financial independence and early retirement. 

Let's delve into the concept.

Grant Sabatier, the mastermind behind the Millennial Money financial site and author of "Financial Freedom," has decoded this crucial number, providing a clear path to retire on your own terms.

So, what exactly is this FIRE number? In simple terms, it's the amount of money you need to sustain your desired lifestyle for the rest of your life without ever needing to work again. The calculation is straightforward: multiply your expected annual expenses by 25. For instance, if your annual expenses total $40,000, you would need to accumulate one million dollars to achieve financial independence and retire comfortably.

This calculation finds its roots in the "4% rule," which gained prominence through the "Trinity study" in 1998. 

The rule suggests that retirees can safely withdraw 4% of their portfolio each year, adjusted for inflation, without depleting their savings. However, it's important to note that the original study considered a 30-year retirement period, while early retirees may need their money to last for 30 to 50 years.

Updated calculations indicate that you can withdraw between 3.5% and 4% of your savings annually while ensuring your portfolio continues to grow over the years. To put it simply, your FIRE number is essentially a reflection of this withdrawal rate.

For those planning an extended retirement, experts recommend aiming for a lower withdrawal rate, typically between 3.3% and 4%. This takes into account factors such as lower bond market yields and high stock valuations. Consequently, if you plan to withdraw 3.3% annually while seeking a $40,000 yearly income, your FIRE number would surpass $1.2 million.

However, while calculating your FIRE number is an essential step towards financial freedom, it's crucial to understand that achieving this goal requires careful planning and flexibility. 

Your retirement expenses might differ from your initial projections, and market fluctuations can impact your annual withdrawals.

Grant Sabatier advises breaking down your journey into manageable steps, focusing on saving for specific periods rather than fixating on the daunting final figure. 

By taking it one year of expenses at a time, you can steadily work towards your ultimate goal of early retirement and financial independence.