How to Calculate FI Score Across Countries

A $600,000 portfolio can mean very different things in Chicago, Lisbon, Mexico City, or Chiang Mai. The portfolio did not change. Your FI Score did, because the life it needs to fund changed.

To understand how to calculate FI score, start with one principle: financial independence is not a portfolio number. It is the relationship between your investable assets and the after-tax cost of the life you want to live in a specific place.

A useful FI Score turns that relationship into a number from 0 to 1000. At 1000, your modeled portfolio covers your modeled financial independence target. At 500, you are halfway there. The math is simple. Getting inputs that reflect a mobile life is the harder part.

The core FI Score formula

At its simplest, an FI Score is your progress toward an FI target:

FI Score = (investable assets / FI target) × 1000

Cap the result at 1000 if the score is designed to represent full independence rather than wealth beyond that point.

If you have $300,000 in investable assets and an FI target of $750,000, the calculation is:

($300,000 / $750,000) × 1000 = 400

Your FI Score is 400. You have funded 40% of the portfolio required by that model.

The score itself is not the insight. The FI target is. A target built from generic U.S. averages can produce a clean score and a bad decision. For location-independent professionals, the target must account for geography, tax residency, currency, and the income you plan to keep.

Calculate the FI target before the score

Your FI target estimates the portfolio needed to fund annual spending indefinitely or for the horizon you have defined. The basic formula is:

FI target = annual portfolio-funded spending / withdrawal rate

Annual portfolio-funded spending is not simply rent plus groceries. It is your full annual cost of life after taxes, less dependable income that will continue without drawing from the portfolio.

For example, assume a couple plans to live in Valencia. Their annual spending is $42,000, including housing, food, transportation, travel, insurance, and irregular expenses. Their modeled tax cost is $5,000. One partner expects $9,000 in stable annual income from a part-time remote role.

Their annual portfolio-funded spending is:

$42,000 + $5,000 - $9,000 = $38,000

Using a 3.5% withdrawal assumption, their target is:

$38,000 / 0.035 = $1,085,714

With $543,000 invested, their FI Score is 500.

Change the city, tax regime, or currency exposure and the score moves immediately. That is not a flaw. It is the point. Residency is a financial variable.

Use investable assets, not net worth

The numerator should reflect capital that can fund your life. Cash, taxable brokerage accounts, retirement accounts that are accessible within your timeline, and diversified investment holdings may count. A primary residence, a car, collectibles, or equity in a business generally should not be treated the same way unless they produce spendable cash flow or you have a defined plan to sell them.

This distinction matters for digital nomads because net worth can look strong while liquidity is weak. A founder may have substantial company equity and a low FI Score. A remote employee with fewer headline assets but a liquid global portfolio may be closer to actual autonomy.

Keep the currency consistent. If your portfolio is measured in U.S. dollars but you expect to spend euros, baht, or pesos, convert both sides of the equation into one reporting currency before calculating the score. The conversion creates a clean snapshot. It does not eliminate currency risk.

Build annual spending from a real location

A location-specific spending model is where most FI Score calculations become useful. Start with a city, not a country. Lisbon and the Algarve are not interchangeable. Neither are Bangkok and Koh Samui.

Include recurring living costs such as housing, food, local transport, health coverage, communications, and routine entertainment. Then add costs that disappear in static retirement spreadsheets: flights to see family, visa renewals, short-term accommodation gaps, coworking, language classes, and the premium often paid for flexibility.

The relevant number is not the cheapest possible lifestyle in a city. It is the lifestyle you would sustain for years. A studio outside the center may be entirely rational. So may a two-bedroom apartment if you work from home and host visiting family. The model needs your actual operating assumptions.

This is why a person can retire years earlier in Porto than in San Francisco on the same savings rate, yet still choose San Francisco for career access or family. FI scoring measures financial distance. It does not decide what kind of life is worth funding.

Include taxes as a spending input

Taxes do not belong in a footnote. They change the amount your portfolio must produce.

For a mobile professional, the relevant question is not only where you physically live. It is where you are tax resident, how investment income is treated there, whether local rules apply to foreign income, and what reporting obligations remain elsewhere. A low-cost city can lose much of its advantage under an unfavorable tax structure. A higher-cost city can be competitive when the tax treatment is materially different.

Model taxes as an annual cash outflow in the spending figure. Do not assume that a lower nominal tax rate automatically means a lower lifetime tax burden. The structure, timing, income sources, and residency pattern all matter.

Treat health care and housing volatility honestly

Two inputs deserve extra attention: health care and rent. Both can be easy to underestimate when comparing cities through tourist prices or short stays.

Use the coverage and care standard you would maintain long term, not a bare-minimum travel policy. For housing, separate current rent from the rent you expect after the novelty of a new destination wears off. A flexible month-to-month lease can be valuable, but that flexibility often costs more than a local annual contract.

A score built on unrealistic housing and health assumptions creates false precision. Better inputs beat more complicated formulas.

Choose a withdrawal rate that matches the model

The withdrawal rate is the assumption that converts annual spending into a portfolio target. A higher rate creates a smaller target and a higher FI Score. A lower rate does the opposite.

There is no universal number because a retirement plan differs by time horizon, asset allocation, flexibility of spending, expected income, and currency exposure. Someone funding a 50-year horizon across multiple countries has a different risk profile from someone with a pension-like income source and a lower-cost home base.

Run at least two scenarios. One can represent your baseline plan and one a more conservative version. If your score falls from 720 to 610 under a stricter assumption, that is useful information. It shows how much of your progress relies on the withdrawal rate rather than on current assets.

Account for income without overstating it

Part-time work, consulting, rentals, royalties, or an online business can lower the amount your portfolio needs to provide. That is the logic behind Barista and semi-retirement models. But only include income that is likely to continue under the conditions you are modeling.

A $20,000 annual consulting assumption can meaningfully raise an FI Score. It can also disappear during a weak market, illness, or a move across borders. Model reliable income separately from optional upside. The cleanest approach is to calculate a fully work-optional score, then compare it with a score that includes the income you intend to keep.

The gap between those two scores measures how much freedom your work income is currently buying.

Compare scores across cities, not just years

Once the inputs are consistent, city comparisons become actionable. Hold your portfolio, asset allocation, and withdrawal assumption constant. Then change only the destination, tax model, and local spending.

You may find that your score is 470 in New York, 630 in Barcelona, and 760 in Kuala Lumpur. That does not mean one city is objectively best. It shows the price of each lifestyle in portfolio years.

IndepAI uses this logic to model FI progress with location, currency, and tax residency inside the calculation rather than treating them as travel details. That makes the score useful for decisions such as whether a two-year move accelerates your timeline, or whether a preferred city requires a higher savings target.

Recalculate when the assumptions change

An FI Score is a live metric. Update it when assets move materially, spending changes, a contract ends, or your intended home base shifts. Recalculate after a currency move as well, especially if your assets and future expenses are denominated in different currencies.

The goal is not to chase a perfect score. It is to see your financial position clearly enough to choose from more places, work on better terms, and put a date on the freedom you are building.