FIRE Norway Calculator

About

I occasionally catch myself wondering, what would it take to effectively just retire? I know that there isn't that much math to it, but it's slightly more tricky than I can quickly ballpark in my head and be satisfied with the answer. Especially with the fortune tax requiring you to constantly withdraw a small amount of you assets, which triggers additional taxes on the realized gains, and so on. This could probably have been a spreadsheet, but it's more fun this way (and accessible with regards to keeping the code/logic up to date, and sharable if others would want to play with it).

It is heavily oriented towards Norway, because that's where I live.

Also note that the tax rules are more complex, and this only gives a quick overview. However, it's mostly based around worst case scenarios with no deductions and similar.

Resources

• Reference budget calculator
• Capital gains tax rate 2024: 37.84% for stocks, 22% for other sources.
• Average home price
• General housing statistics
• Property tax rates
• Fortune tax rates and deductions
• Property valuation for fortune tax

Flaws

The major shortcomings I'm aware of

• The capital gains tax is only 1.0 percent up til 20 000 000, it's only after that it's 1.1%. At the moment, I just can't be bothered implementing it. Just adjust the value in the field if you want more accuracy for a lower bracket
• Not all municipalities take their part of the fortune taxes (though these are pathological cases).
• The property tax is based on the highest legal rate, based on the property market value. Most municipalities run with a discounted valuation for primary residences, and few charge the highest rate.
• The calculation assumes all liquid assets are in stocks. Ideally it should support a mixture with other asset classes where capital gains are taxed at the lower 22% rate.

The math behind

Here is the calculation this is based on

(Annual) withdrawal = desired spending amount + taxes = liquid assets * withdrawal rate

The below is outdated, but I'm leaving it until I find the motivation to clean it up

taxes = fortune tax rate * (liquid assets + (home value - deduction percentage) + other illiquid assets - zero bracket cutoff) + property tax rate * home value + amount withdrawn * capital gains tax rate

(Annual) withdrawal = liquid assets * withdrawal rate = desired spending amount + (fortune tax rate * (liquid assets + (home value - deduction percentage) + other illiquid assets - zero bracket cutoff) + property tax rate * home value + amount withdrawn * capital gains tax rate)

(Annual) withdrawal = liquid assets * withdrawal rate = desired spending amount + fortune tax rate * (liquid assets + (home value - deduction percentage) + other illiquid assets- zero bracket cutoff) + property tax rate * home value + (liquid assets * withdrawal rate) * capital gains tax rate

Solved for liquid assets

liquid assets * withdrawal rate = desired spending amount + fortune tax rate * liquid assets + fortune tax rate * (home value - deduction percentage) + fortune tax rate * other illiquid assets - fortune tax rate * zero bracket cutoff + property tax rate * home value + liquid assets * withdrawal rate * capital gains tax rate

taxes = fortune tax rate * (liquid assets + (home value - deduction percentage) + other illiquid assets) + property tax rate * home value + amount withdrawn * capital gains tax rate

(Annual) withdrawal = liquid assets * withdrawal rate = desired spending amount + (fortune tax rate * (liquid assets + (home value - deduction percentage) + other illiquid assets) + property tax rate * home value + amount withdrawn * capital gains tax rate)

(Annual) withdrawal = liquid assets * withdrawal rate = desired spending amount + fortune tax rate * (liquid assets + (home value - deduction percentage) + other illiquid assets) + property tax rate * home value + (liquid assets * withdrawal rate) * capital gains tax rate

Solved for liquid assets

liquid assets * withdrawal rate = desired spending amount + fortune tax rate * liquid assets + fortune tax rate * (home value - deduction percentage) + fortune tax rate * other illiquid assets + property tax rate * home value + liquid assets * withdrawal rate * capital gains tax rate

liquid assets * withdrawal rate - fortune tax rate * liquid assets - liquid assets * withdrawal rate * capital gains tax rate = desired spending amount + fortune tax rate * (home value - deduction percentage) + fortune tax rate * other illiquid assets + property tax rate * home value

liquid assets = (desired spending amount + fortune tax rate * (home value - deduction percentage) + fortune tax rate * other illiquid assets + property tax rate * home value)/(withdrawal rate - fortune tax rate - withdrawal rate * capital gains tax rate)

Solved for spending amount

(Annual) withdrawal = liquid assets * withdrawal rate = desired spending amount + fortune tax rate * (liquid assets + (home value - deduction percentage) + other illiquid assets) + property tax rate * home value + (liquid assets * withdrawal rate) * capital gains tax rate

desired spending amount = liquid assets * withdrawal rate - (fortune tax rate * (liquid assets + (home value - deduction percentage) + other illiquid assets) + property tax rate * home value + (liquid assets * withdrawal rate) * capital gains tax rate)