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🎯 The One Number That Changes Everything: Your Freedom Rate
💡 What if one number could tell you how close you are to financial freedom?
Not your salary.
Not your job title.
Not even your net worth!
The number that really matters is your Freedom Rate — the percentage of your income that you invest in broad-based, low-cost index funds like VAFTGAG, VHVG, or VDWXEIA.
At Rebel Finance School, we’ve seen it over and over again:
- 📈 The higher your Freedom Rate, the faster you reach financial independence.
- 💸 The lower your spending, the less you need to retire.
- 💥 The bigger the gap between what you earn and what you spend— the sooner you’re free. It’s all about the gap baby!
Coming up below the calculator is a quick idea of how to chare this withy your kids, your grandkids or anyone you care about!
🧮 Try the Calculator That Changes Lives
We built a super simple calculator to show you how powerful your Freedom Rate really is.
👉 Try it below
You can tweak three key numbers to see how fast you can reach financial freedom:
🔧 What You Can Adjust:
- 💰 Freedom Rate – How much of your income you invest each year.
- 📈 Investment Return Rate – How much your investments grow annually (before inflation).
- 📉 Inflation Rate – How much prices rise each year.
The calculator then shows you how long it will take to build up enough wealth to live off your investments — using the 4% rule (i.e. needing 25× your annual expenses). This is starting from nothing!
This is not meant to replace the Retirement Calculator, it is meant to show you the power of your freedom rate and how just upping it a few percentage points can shave YEARS off your retirement date.
4% Rule Retirement Calculator
😲 Example That Might Blow Your Mind
Let’s say you:
- Earn £30,000 a year
- Invest £10,000 of it
- That’s a Freedom Rate of 33.33%
- You assume 10% investment growth and 3% inflation
👉 According to the calculator, you could retire in just 22 years and 1 month 🎉
That’s not a dream. That’s maths.
And it’s all based on the idea that once you’ve saved 25× your annual expenses, you’re financially free.
If you started at age 20 you would be retired by 42 years old. Not bad? Now these aren’t your numbers, your numbers are your numbers but if there is ONE number that you need to focus on it is your freedom rate. The percentage of your income going into investments!
Remember this is starting from ZERO!
If you are 40 and starting from zero you could be done by 62, 8 years before state retirement age in the UK. You could by 8 years of your life back with this!
🧠 How to Calculate Your Freedom Rate (The Easy Way)
Your Freedom Rate is the percentage of your income that you invest. Not what you are saving as lots of people save in a cash ISA or for later spending on a car or holiday. Saving is not your route to freedom. Investing is.
✏️ The Formula:
Freedom Rate = Amount You Invest Each Year ÷ Your Total Income
That’s it! No fancy maths. Just divide what you invest by what you earn.
💡 Example 1:
You earn £40,000 a year.
You invest £10,000 of it.
Freedom Rate = £10,000 ÷ £40,000 = 0.25 = 25%
✅ So your Freedom Rate is 25%
💡 Example 2:
You earn £60,000 a year.
You invest £18,000 of it.
Freedom Rate = £18,000 ÷ £60,000 = 0.30 = 30%
✅ So your Freedom Rate is 30%
The higher your Freedom Rate, the faster you’re buying your freedom.
💥 More invested = more compound growth = fewer years to retirement.
👩👧👦 Share the Magic: A Process to Use With Your Kids & Grandkids
This isn’t just for you. It’s for your kids. Your grandkids. Your nieces, nephews, and neighbours. Basically anyone you care about!
Here’s how to share it:
🪄 Step-by-Step Freedom Rate Magic Session
- Gather your people — kids, grandkids, anyone you care about. Maybe have cake, biscuits, a Hobnob to enjoy as you chat?
- Open the calculator on a phone or laptop.
- Ask them: “How much do you think you’ll earn each year?” This question alone will spark some interesting questions!
- Then ask: “How much could you invest each year if you started now?”
We were friends with a family in New Zealand who did this with their teenage daughter and she decided she could save 30% of everything she earnt working at the corner shop! She is now worth of 50k! - Type the percentage in together — and watch their jaws drop.
- Talk about index funds — explain how investing in the whole market (like Vaftgag or VT) is simple and powerful.
- Challenge them: “What could you do to increase your Freedom Rate by just 5%?”
- Celebrate 🎉 — because they’ve just seen a glimpse of freedom.
Katie and I wish someone had sat us down younger and taught about this stuff. Now is your chance to fix it for the next generation.
At least they can never say to you I wish I knew about this sooner!
🔥 Final Thought: Focus on the Freedom Rate
Forget chasing the perfect stock.
Forget trying to time the market.
Forget the noise.
Focus on your Freedom Rate.
Create a gap between what you spend and what you earn.
Put that money into index funds.
Repeat monthly.
Buy your FREEDOM FIRST
That’s it. That’s the game.
And you just got the cheat code. 🎮
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This has blown my mind. I can invest 75% and retire in 6 years .
Hey Jessica, we love maths! it is amazing as you start to see the numbers unfold! Thanks for telling us. Alan
Such an important number for people to be aware of and constantly have in their mind when they plan
Hey Stefan, it makes all the difference! Thanks for commenting! ALan
Hey Alan, do you have any thoughts on self-employed people? I find it really difficult to know what % I invest per month as each month is different. I know an approximate amount I invest each month. Could I use this figure instead?
Tom, I know exactly what you mean. I was self-employed for years and it was tough to figure out. The simple key thing is how much you put away verses a rough estimation of how much profit you make. You should be able to know easily I invested £500 this month, £200 the next and over the year that makes £4000. I made £xxxx proft and the compare the two to get your freedom rate….
Does that make sense? We want the long term rate anyway not the super specific monthly which we know will vary massively but you can work it out on a simple yearly basis!
Alan
Hi – really interested to know, given your expenditure 2025 around 10”k£ if you’ve abandoned the rough rule of thumb of spending 4% of portfolio plus inflation … I realise this rule is based on never running out of money so is effectively a worst case scenario model, as in most cases growth is huge, leaving a big pot at death; have you replaced this with some complicated calculation to try to achieve ‘die with zero’??
What an amazing calculator, thanks for all the work on puttinng it together. Is the yearly earn before or after tax? I am assuming it’s after, but just wanted to double check. Thanks in advance :)
hey Zeb, it depends. Sometimes you can put money into your pensions before tax (country and tax laws dependent) which is why we didn’t state. I don’t think you can do that in New Zeland but then you don’t have any capital gains tax either which is amazing… Alan
Great demonstration. How can I do the same calculation but with my current starting balance?
Hey Brian, thank you. That would be in the retirement calculator https://rebeldonegans.com/finance/fire/retirement-calculator/ we will have a brand new version for you by week 8, this is last years version and still works. And a workshop showing how to use it all… Sending happiness.. Alan
Hi Alan and Katie,
I don’t usually write reviews / comments but I wanted to thank you for all the work you put into the course and the associated materials. It really has helped my wife I am straighten out our finances.
I do have a question regarding the “How big is your gap” calculator and, specifically, how the ‘Freedom rate’ in the “Fill in your numbers” sheet is calculated. It would seem to me in order to calculate the freedom rate as a percentage, one would divide the “Total freedom purchase” value by the income value for the month then multiple by 100 i.e. Freedom Rate (%) = (C27/C10)*100. However, the spreadsheet formula is C27/(C10+C20+C21) [I have removed the error checking for simplicity].
I suspect I’ve missed something obvious, however, I would be grateful if you could doublecheck my ‘homework’ and perhaps explain why the formula in the spreadsheet is correct?
Many thanks!