DSE FIRE Calculator

What is the FIRE Movement?

FIRE stands for Financial Independence, Retire Early. It is a lifestyle movement whose goal is to reach a point where your investments generate enough passive income (dividends and capital gains) to cover all your living expenses for the rest of your life.

How FIRE works in Bangladesh

Globally, the "4% Rule" is a standard benchmark for safe withdrawals. However, in the context of the Bangladesh economy—with higher inflation but also higher interest rates and dividend yields—many experts suggest a 5% or 6% withdrawal rate might be more appropriate for a diversified portfolio.

Calculating your "Freedom Number"

Your FIRE number is the total value of your investment portfolio required to sustain your lifestyle.
Formula: Annual Expenses ÷ Safe Withdrawal Rate

For example, if your family spends Tk 50,000 per month (Tk 6 Lakh per year) and you use a 5% withdrawal rate, your FIRE number is Tk 1.2 Crore (6,00,000 / 0.05).

Building your FIRE Portfolio on the DSE

To achieve FIRE in Bangladesh, your portfolio should focus on:

• High Dividend Yield Stocks: Blue-chip companies like GP, BATBC, and Summit Power that pay regular cash.
• Growth Companies: Stocks in sectors like IT, Pharmaceuticals, and Engineering that can grow faster than the inflation rate.
• Asset Allocation: A mix of Equity (70%) and Fixed Income like Savings Certificates or Treasury Bonds (30%) to provide stability.

Inflation: The Biggest Challenge

In a high-inflation environment like Bangladesh, you must ensure that your portfolio continues to grow even after you start withdrawing. This is why "Dividend Reinvestment" is crucial during your accumulation phase, and having some exposure to high-growth stocks is essential during your retirement phase.