How Much Money Do You Need To Never Work Again – Less Than You Think

James Beattie By James Beattie 18 Min Read

Never working again. To most this probably seems like a far fetched pipe dream. However, there is a whole community of people aiming for that goal. The financially independent retire, early community aim to build up enough money in investments or property so they can live off their passive income.

If you are smart with your money and invest aggressively enough, there’s a good chance you could retire much earlier than 65. In this article we’re going to take a look at how much you need to never work again. Let’s jump in.

Quick Overview
If you want to never work again you will need roughly 33x your annual expenses invested in the stock market. For example, if you wanted an income of £32,000 per year, you would need to have £1,056,000 invested. Theoretically this would allow you to withdraw from the portfolio without it ever running out.

Financially Independent Retire Early

Financially Independent Retire Early (FIRE) is becoming more popular each an every year. This community aims to invest enough money earlier in life so they can live of their investment returns without having to work anymore.

What Is FIRE?

In my opinion this is one of the most realistic ways to not need to work again. It requires a lot of discipline and hard work up front but pays dividends (literally) for the rest of your life.

I’m not going to go into depth on FIRE in this article but if you want to learn more I have created a full guide to FIRE.

The FIRE community use something called the “4% rule” to determine how much they will need to retire early. Let’s take a look at how it works.

Using The 4% Rule To Never Run Out Of Money

The 4% rule is based on a study by 3 professors from Trinity University.

The study shows that investors can withdraw 4% of their portfolio in the first year of retirement and then keep withdrawing this value (Adjusted for inflation) each year after for at least 30 years without running out of money. For most people in retirement this is long enough.

Here’s a quick breakdown of how it works:

  1. Initial Withdrawal: In the first year of retirement, you withdraw 4% of your total retirement savings.
  2. Adjust for Inflation: In subsequent years, you increase the amount you withdraw by the inflation rate. This means if you withdrew $40,000 the first year and inflation was 2%, the next year you would withdraw $40,800 ($40,000 + 2% of $40,000).
  3. Longevity of Savings: By following this rule, there’s a high probability that your savings will last 30 years or more, even considering market fluctuations.
  4. Basis: The rule is based on historical stock and bond returns. It assumes your portfolio is a mix of stocks and bonds (commonly 50% stocks and 50% bonds or something similar).

If you plan on retiring earlier than 65 you may want to be withdrawing a lower amount so that your portfolio lasts long enough that you never have to work again. A 3% withdrawal rate is more realistic for this scenario.

Using this number we can work backwards to see how much we actually need to retire early and never work again.

How Much Money Do You Need In The UK To Never Work Again

If we can withdraw 3% per year without running out of money, we would need to have 33x our annual expenses invested to ensure we did not run our of money.

For example, if you have annual expenses of £32,000 per year, you would need to have £1,056,000 invested.

33 x £32,000 = £1,056,000

Theoretically you can withdraw £32,000 per year from this portfolio without ever running out of money. In fact, at a 6% growth rate and 2.9% inflation rate per year your portfolio would continue to grow.

4% rule calculator
Credit: 4% rule Calculator

The lower your withdrawal rate, the less chance you have of running out of money. It’s important to note that these theories are based on historical market returns. In the future the stock market could perform significantly differently than it has the past 50 years.

When you retire is also important. If you have a few bad down years in a row directly after retirement, this will hurt how much you can withdraw without running out of money.

We would recommend aiming for a minimum of 33x your annual expenses however if you can get upwards of 40x your annual expenses invested, you have a much higher chance of never having to work again.

This is more important for people who want to retire earlier than the normal retirement age. As you have longer to retirement, there’s a higher chance you could run out of money, so you need more buffer room for bad market environments.

I have created a chart below giving you a rough estimate of how much you will need depending on your yearly expenses.

Yearly ExpensesPortfolio Value Required
Portfolio Value To Retire Based On Yearly Expenses

If you want to calculate your numbers in more detail check out our FIRE Calculator which shows you exactly how much you need to retire and the age you can retire based on how much you invest.

How Long Will It Take To Save The Amount You Need

Now that you know how much you will need to have invested, we can see how long it will take you to reach that goal. You may be thinking that you could never save over £1 million. That’s probably true. However, you can invest your way there by benefitting from the power of compound interest.

Albert Einstein described compound interest as the 8th wonder of the world. In life you can either benefit from it by investing or be a victim of it by getting yourself in debt.

Let’s look at how compounding interest works. In Year 1 you have £10,000 and get a 10% interest rate giving you £11,000 at the end of the year. The next year, you get interest on your original £10,000 plus the £1,000 in interest. In Year 2 you would receive £1,100 in interest giving you a total balance of £12,100.

It may not look like much in these early years but over long periods of time compound interest takes over and starts to generate you massive returns.

The chart below shows you what a £300 investment every month for 40 years turns into at an 8% rate of return. You may be wondering where you can get an 8% return? The stock market over the past 50 years has returned approximately 10% per year on average.

£300 Compounded at 8% for 40 years.

If you start at 25 ad invest £300 per month until you are 65 you could have £1,047,302 at retirement. Over this period, you only contribute £144,000 to your account. The other £903,000 comes from compounding interest.

Now, if you want to retire earlier than 65, you will need to start investing early and be more aggressive with your investments. For example, currently I try to max out my ISA each year. This equates to about £1,666 per month. Investing in an ISA allows me to grow my money tax free, so when it comes to withdrawing at retirement, I don’t have to pay any tax. You can open an ISA with Trading 212.

If I need £32,000 to live, I would need a portfolio of around £1,056,000. Investing £1,666 per month at an 8% rate of return would get me to that portfolio value in approximately 21 years.

This means if you started investing at 25 and stuck to the plan for 21 years, you could retire and never work again at age 46. Not bad. If you received any inheritance or other lump sums during this period it could rapidly increase the speed at which you could retire.

The chart below can give you a rough idea of how long it would take you to retire depending on the % of income you save/invest out of your take home pay. It assumes that your expenses stay the same in retirement as they are when you are working.

Years To Retirement Based On Savings Rate

You should now have a good idea of how much money you need to retire and never work again as well as an idea of how long it will take you. If you are serious about reaching this goal, it’s very doable.

A great way to speed up your path to retirement is by earning more money and keeping your lifestyle the same. This way you can invest the difference. I would recommend checking out our guide on how to earn £100 per day in the UK.

Ways To Earn Income So You Never Have To Work Again

Throughout the article, we have talked about investing a portion of your salary each month to reach the goal of retiring early and never working again. However, this is not the only option you have. There are multiple ways to reach financial freedom.


Investing is the most popular way to retire early. It’s accessible to everyone and you don’t have to do anything special to get started. Simply start investing a portion of your income every month. You may already be doing this through your workplace pension.

In my opinion, most people should invest in simple Index funds that track the market. A few ones that I like in the UK are VUSA which tracks the S&P 500 and the Fidelity Index World Fund which tracks the MSI world Index. These funds give you diversified access to the market without having to pick individual stocks.

For most people getting started investing, I think that Trading 212 is a great option. They have zero fee Trading and also offer an ISA which we talked briefly about above.

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This is only a brief intro to investing. If you want a more detailed guide, check out our beginners guide to investing.


Property is another popular route for people who retire early. By purchasing multiple buy to let properties you can achieve financial freedom through rental income.

There will likely be some work still involved with managing your properties but it will be more hands off than a traditional job.

You may purchase these homes on buy to let mortages an eventually end up with fully paid off cash flowing properties that provide you with a consistent income.

Investing in property is a lot more complex than simply investing in an Index fund every month however many people see significant upside through leverage in the form of a mortgage. This can accelerate your path to financial freedom however in the event of a market down turn can also see you left in a position where you cannot pay your mortgages and end up losing your properties.

Having enough equity in your properties or buying cash can ensure this doesn’t happen. It’s a viable option for passive income but for most I would go with investing.

Selling A Business

Selling a business is another way to get enough money to live again without working. This is my method of choice. In the past I have sold some of my websites for low 6 figures. I’m now trying to build this website right here to a 7 figure valuation and hopefully sell it one day.

While there is a lot of risk involved with this, it can massively accelerate your path to financial freedom. If you can sell a business for your required FIRE number, you can invest the money from the sale and live of the investment returns.


Some people may be lucky enough to receive an inheritance large enough to sustain their lifestyle. If you did receive a large inheritance, you could invest it an live of the investment returns as we have mentioned above. Essentially this just shortens the path to your FIRE number.

If you don’t invest the inheritance and just start spending it, it can run out much faster than you think. If you’re luck enough to be in this position, you should talk to a financial advisor to see what the best options are for you, in your personal circumstances.

Is Never Working Again Really What You Want?

I think we glamourise not working in our heads. However, you can only sip cocktails on the beach for so long before getting bored. I think reaching financial freedom gives you the opportunity to work on projects you really care about. Most of the time, there will be a way to make some sort of money doing something you actually enjoy.

It’s probably not that you don’t ever want to work again, it’s that you don’t want to work a job you hate anymore.

You may have heard the saying, “Love what you do and you will never work a day in your life”. I fully believe that’s true.

I’m lucky enough to be in a position where I can work on this blog full time. I get up every day and actually enjoy working on it. I love business in general. Even if I won the lottery, I’d probably use the money to buy a business.

If you can find that intersection between something you love and making money with it, you can reach a point of financial freedom much earlier than you might have thought.

Final Thoughts

To some people, never working again seems like an unrealistic goal. To us, it’s achievable with hard work and discipline over a long period of time. If you really want to quit your job and never work again, you’ll need roughly 33x your current living expenses.

If your interested in learning more about retiring early, check out the resources below:

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I'm passionate about personal finance and making money. Currently trying to FIRE solely by building online assets. Grew my stock portfolio to £86,000 by 26.
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