Would downsizing get me there sooner?

Usually, and by more than the equity alone would suggest. Selling frees capital once.

Living somewhere cheaper lowers what you spend every month after that, which raises what you can invest and lowers the amount you need saved at the same time.

Put in the equity the move would release and what you pay for housing before and after. The result separates how much of the pull-forward comes from the check and how much comes from the lower monthly cost.

Your Optional Number is annual spending divided by a safe withdrawal rate. At 4%, that means every $100 a month you permanently stop spending takes about $30,000 off the amount you need saved.

A move that cuts housing by $900 a month therefore lowers the target by roughly $270,000, before a single dollar of equity is counted. And the $900 is also available to invest while you are still working, so it arrives on both sides of the equation at once.

This is the part that surprises people, and the calculator above splits it out so you can see it on your own figures rather than take it on faith.

A $150,000 check invested at a 7% real return is doing one job. A $900 monthly saving is doing three: it raises contributions now, it lowers the target permanently, and it keeps doing both for every year between the move and the day you stop working.

Which means a lateral move can be worth more than it looks. Trading a large house for a similar-value flat with lower running costs releases no equity at all and can still pull the date forward.

Selling a main home is one of the better-treated transactions in the tax code. You may exclude up to $250,000 of gain, or $500,000 filing jointly, if you owned the home and lived in it as your main home for at least two of the five years before the sale.

The exclusion can be used repeatedly, though generally no more than once every two years. Whatever is left after it, plus moving costs, should come off the equity figure you put into the calculator, because the model takes that number at face value.

Relevant if you are also planning a breakThe IRS counts short absences, a summer holiday for instance, as periods of use toward those two years. It states that longer breaks do not, and the example it gives is a one-year sabbatical. If a break and a sale are both on your list, the order you do them in can matter.

The Scenarios Lab has a sell-the-house lever that puts the proceeds into the portfolio on a date you choose, and stacks with everything else. Pair it with the different-target lever to model the lower running costs, since that is what actually moves your Optional Number.

• IRS — Publication 523, Selling Your HomeThe $250,000 and $500,000 exclusions, the ownership and use tests, and how absences are counted.
• IRS — Tax considerations when selling a homeThe two-of-five-years requirement and the limit on how often the exclusion may be claimed.

What if the smaller place costs the same?

Then you release no equity, and the move can still pay if the running costs are lower. The calculator will show the pull-forward coming entirely from the monthly saving.

Does renting instead count?

The arithmetic is the same: equity released, running cost changed. Whether renting is cheaper month to month depends on your market, and the model takes whatever figure you give it.

Should I use the proceeds to pay off a mortgage instead?

That lowers your monthly cost rather than raising your balance, so it shows up on the other side of this calculator. Nothing here models debt directly, so enter the result as a lower housing cost and a smaller equity release.

Why doesn’t my home count toward Optional already?

Home equity is excluded from the eligible portfolio because it does not pay for groceries. It only counts when it turns into invested capital, which is exactly what this page is about.