How We Calculate FIRE Numbers by State
Unlike traditional retirement planning, early retirement FIRE planning excludes Social Security (unavailable before age 62) and uses a more conservative safe withdrawal rate:
FIRE Number Formula (early retirees):
Annual State Cost ÷ 0.035 = FIRE Number
OR: Annual State Cost × 28.57 = FIRE Number
Annual state cost = BLS Consumer Expenditure Survey 2024 (65+ household spending) × state cost-of-living index (MERIC Q3 2025). The 3.5% rate is used instead of 4% because early retirees face 40-50+ year horizons.
For the Social Security bridge period (ages 60–62), most FIRE practitioners maintain a separate 1–3 year cash cushion to avoid tapping the investment portfolio during a potential market downturn at the start of retirement.
Top 10 Best States for FIRE / Early Retirement (2026)
| State | Annual Cost | FIRE Number (3.5%) | Tax Grade | HC Rank | Income Tax | SS Tax | FIRE Rating |
|---|---|---|---|---|---|---|---|
| Tennessee | $49,500 | $1.41M | A | #44 | None | ✅ | ★★★★★ |
| South Dakota | $52,000 | $1.49M | A+ | #4 | None | ✅ | ★★★★★ |
| Mississippi | $45,600 | $1.30M | B- | #49 | 4% flat | ✅ | ★★★★☆ |
| Iowa | $50,200 | $1.44M | B | #28 | 3.8% flat | ✅ | ★★★★☆ |
| Kansas | $48,500 | $1.38M | B+ | #35 | 5.7% max | ⚠️ | ★★★★☆ |
| Florida | $57,000 | $1.64M | A+ | #27 | None | ✅ | ★★★★☆ |
| Wyoming | $52,000 | $1.49M | A+ | #33 | None | ✅ | ★★★★☆ |
| Missouri | $49,500 | $1.41M | B+ | #32 | 4.5% max | ⚠️ | ★★★★☆ |
| Oklahoma | $47,500 | $1.36M | B- | #43 | 4.75% max | ✅ | ★★★☆☆ |
| North Carolina | $55,000 | $1.59M | B+ | #25 | 4.25% flat | ✅ | ★★★★☆ |
Sources: BLS CES 2024; MERIC Q3 2025; Kiplinger 2026; WalletHub 2026; Plootus Research 2026.
Your Personal FIRE Number Calculator
🔥 Calculate Your State-Adjusted FIRE Number
The FIRE Healthcare Gap — Your Biggest Pre-Medicare Risk
The most overlooked FIRE risk is healthcare. Before Medicare eligibility at age 65, you must fund health insurance independently. ACA Marketplace premiums for a 55-year-old can exceed $800–$1,200/month in many states. Income management is the key strategy: keep income below 400% of the federal poverty level to qualify for premium tax credits.
Estimated Healthcare Cost at Age 55
ACA Marketplace plan for a single 55-year-old without premium subsidies: approximately $18,000–$30,000/year depending on state and plan tier.
The FIRE Healthcare Strategy
Keep MAGI below 400% FPL by using Roth conversions, managing 401(k) withdrawals, and holding an HSA. Qualify for substantial premium tax credits.
Frequently Asked Questions
- Bureau of Labor Statistics, Consumer Expenditure Survey 2024 (65+ age group)
- Missouri Economic Research and Information Center (MERIC), Cost of Living Index Q3 2025
- Bengen, W.P. (1994). Determining Withdrawal Rates Using Historical Data. Journal of Financial Planning
- Pfau, W. (2011). Safe Savings Rates: A New Approach to Retirement Planning. Journal of Financial Planning
- Kiplinger, Retirement Taxes 2026; WalletHub Best States to Retire 2026
- KFF Health Insurance Marketplace Calculator 2025
- Plootus Research 2026
