How to Reach FIRE as a Software Engineer in Europe: Complete Blueprint

In the evolving world of technology, the dream of achieving Financial Independence, Retire Early (FIRE) is becoming increasingly tangible, especially for software engineers and other high-paying professions. But what does FIRE entail?

Simply put, it's a lifestyle movement focused on saving and investing heavily to retire far earlier than traditional budgets and retirement plans would allow. This concept has gained momentum among professionals who aspire to enjoy life on their terms, free from the constraints of obligatory work.

The European Path to FIRE

While in the U.S. the typical route to FIRE for software engineers often involves joining big tech companies and amassing wealth quickly in high-cost-of-living (HCOL) locations such as California or New York, the European path to FIRE can be distinctly different.

In Europe, the strategy is less about reaching the highest possible earnings and more about strategic lifestyle planning and geo-arbitrage—taking advantage of the cost differences between countries.

This approach is not just about earning and saving; it's about making smart choices where you can:

• Work in HCOL areas with high salaries
• Explore the affordability and charm of low-cost-of-living (LCOL) regions
• Leverage Europe's diverse and accessible landscape
• Transition smoothly between different economic environments

The unique benefit of Europe is living and working in different economic environments, allowing for a smoother transition to the desired FIRE lifestyle.

Find high-paying tech jobs to start your FIRE journey →

The Blueprint: 7 Steps to FIRE

This guide explores one particular blueprint for software engineers in Europe to achieve financial independence and retire early. It's important to note that this is just one of many paths to FIRE.

Step 1: Maximize Income in HCOL Areas

Start your journey by securing a high-paying job in a high-cost-of-living area.

Target compensation: €100k-€250k total compensation, depending on your lifestyle and frugality.

Best cities for high salaries:

• Zurich, Switzerland (€150k-€280k)
• London, England (€130k-€260k)
• Amsterdam, Netherlands (€120k-€250k)
• Dublin, Ireland (€110k-€255k)

This step is crucial for building a strong financial foundation quickly.

Browse jobs in high-paying European cities →

Step 2: Foster a Strong Saving Habit

Develop a robust saving plan. Your savings rate is a key determinant of how quickly you can transition to FIRE.

Target savings: €30k-€100k per year

Aim to live below your means while still enjoying your life. This isn't about extreme frugality—it's about conscious spending aligned with your values.

Step 3: Explore LCOL Locations

Begin exploring low-cost-of-living locations. Spend time in various LCOL areas to find one or more that align with your lifestyle preferences.

Top LCOL regions in Europe:

• Poland (Warsaw, Kraków)
• Portugal (Lisbon, Porto)
• Spain (Valencia, Málaga)
• Greece (Athens, Thessaloniki)
• Bulgaria (Sofia, Plovdiv)
• Serbia (Belgrade)
• Romania (Bucharest, Cluj-Napoca)

Target monthly costs: €2k-€4k for comfortable/luxurious lifestyle

This step is about balancing quality of life with affordability. Use vacation time to explore these locations extensively.

Step 4: Transition to Remote Work

Work towards gaining remote work permissions. This flexibility allows you to spend more time in your chosen LCOL locations, further reducing your living expenses and allowing you to learn more about those locations and your preferences among them.

Strategies:

• Negotiate remote work after 6-12 months of strong performance
• Look for remote-first companies
• Transfer within your company to remote-friendly teams

Step 5: Invest in Cash-Flow Assets

Channel your savings into assets that generate good cash flow. These could include:

• Real estate (rental properties)
• E-commerce businesses
• Online businesses (SaaS, content, courses)
• Dividend-paying investments
• Small businesses with reliable cash flow

Target ROI: 10-15%+ returns

Choose options that are more active (i.e., require more work from your side) than ETFs but yield higher returns and still align with your risk tolerance and interests.

Step 6: Coast Towards FIRE

Once your passive income is sufficient to support a coast FIRE lifestyle (one where you still need to work, but not that much thanks to other income sources), transition to a lower-stress, fully remote job, even if it pays less than your initial HCOL job.

Coast FIRE threshold: €100k-€250k in invested assets generating 15%+ ROI = €15k-€37.5k/year passive income

Coast FIRE job: €3k-€6k per month after taxes, fully remote

Continue to save and invest, but with less pressure. This phase is about enjoying life while your investments compound.

Step 7: Achieve Full FIRE

Reach the ultimate goal when your passive income covers all your expenses. At this point, you're financially independent and can pursue what brings you joy without financial constraints.

Full FIRE threshold: Passive income ≥ Annual expenses

Learn about career strategies for FIRE →

Quantifying the Journey

Let's break down the numbers to make this concrete:

Milestone	Savings Needed	Passive Income (15% ROI)	Work Required	Lifestyle
Start	€0	€0	Full-time HCOL	High stress, high income
2 Years	€60k-€140k	€9k-€21k/year	Full-time HCOL	Building foundation
3-4 Years	€100k-€250k	€15k-€37.5k/year	Transition period	Exploring LCOL options
Coast FIRE	€100k-€250k	€15k-€37.5k/year	Part-time/low stress	LCOL lifestyle established
5-8 Years	€250k-€500k	€37.5k-€75k/year	Minimal/optional	Growing wealth
Full FIRE	€400k-€800k+	€60k-€120k+/year	None required	Complete freedom

Income Goals by Phase

Phase 1 (Years 1-3): Accumulation

• Total compensation: €100k-€300k USD
• Location: Zurich, London, Amsterdam, Dublin, or remote
• Savings rate: €30k-€100k/year

Phase 2 (Years 4-6): Coast FIRE

• Total compensation: €50k-€80k (remote, low stress)
• Location: LCOL European country
• Passive income: €15k-€37.5k/year
• Combined income: €65k-€117.5k/year
• Living costs: €24k-€48k/year
• Continued savings: €20k-€70k/year

Phase 3 (Years 7-12): Full FIRE

• Passive income: €60k-€120k+/year
• Work: Optional, passion projects only
• Location: Wherever you want

The European Advantage: Geo-Arbitrage

Europe's unique geography and economic diversity create perfect conditions for FIRE through geo-arbitrage:

High-Earning Phase (HCOL)

City	Senior Eng Salary	After Tax	Annual Costs	Savings/Year
Zurich	€200k	€145k	€60k	€85k
London	€160k	€105k	€48k	€57k
Amsterdam	€150k	€95k	€42k	€53k
Dublin	€155k	€97k	€42k	€55k

Coast FIRE Phase (LCOL)

Location	Monthly Cost	Annual Cost	Quality of Life
Warsaw, Poland	€2.5k	€30k	High - vibrant city, culture, nightlife
Lisbon, Portugal	€3k	€36k	High - ocean, sunshine, digital nomads
Belgrade, Serbia	€2k	€24k	High - friendly people, low costs
Valencia, Spain	€2.5k	€30k	High - beaches, weather, lifestyle
Sofia, Bulgaria	€1.8k	€21.6k	Medium-High - affordable, mountains

The Math

Scenario 1: Aggressive Path

• Years 1-3: Work in Zurich, save €85k/year = €255k
• Invest in 15% ROI assets = €38.25k/year passive income
• Move to Belgrade (€24k/year costs)
• Need €12k-€24k/year from part-time work
• Coast FIRE achieved in 3 years

Scenario 2: Balanced Path

• Years 1-5: Work in Amsterdam, save €53k/year = €265k
• Invest in 12% ROI assets = €31.8k/year passive income
• Move to Valencia (€30k/year costs)
• Need €18k-€30k/year from remote work
• Coast FIRE achieved in 5 years

Scenario 3: Comfortable Path

• Years 1-4: Work in London, save €57k/year = €228k
• Invest in 10% ROI assets = €22.8k/year passive income
• Move to Warsaw (€30k/year costs)
• Need €25k-€40k/year from remote work
• Coast FIRE achieved in 4 years

Compare detailed salary and savings data →

Important Considerations

Family Planning

Consider postponing having children until you're fully FIREd, or at least coast-FIREd, as raising kids in HCOL areas while you're still in the accumulation phase can significantly impact this strategy.

With children: Add €10k-€30k/year to costs, extending timeline by 2-4 years.

Timeframe Expectations

• Steps 1-6 (Start to Coast FIRE): 3-6 years
• Coast FIRE to Full FIRE: 3-6 years
• Total to Full FIRE: 6-12 years

Career Progression Requirements

Achieving a salary in the €100k-€250k range should be feasible within 3 years of focused career development:

Year 1: Learn and prepare (algorithms, system design)
Year 2: Target and land high-paying role
Year 3: Excel and get promoted or switch for higher compensation

See our guide on how to reach €100k+ as a software engineer in Europe.

Alternative FIRE Strategies

While this blueprint offers a harmonious approach to FIRE, there are other methods:

Traditional High-Net-Worth Path:

• Focus solely on career advancement
• Reach very high net worth (€1M-€3M+)
• Invest in lower-risk assets like bonds and index funds
• Retire on 3-4% withdrawal rate

Lean FIRE:

• Extreme frugality in HCOL cities
• Save 60-80% of income
• Retire early with minimal expenses

Barista FIRE:

• Save enough that minimal work covers expenses
• Work part-time for enjoyment + healthcare
• More flexible than traditional employment

The 15% ROI Question

You might be wondering: "Is 15% ROI realistic?"

Yes, with active investing:

Real estate arbitrage:

• Buy in growing LCOL areas
• Rent to digital nomads / expats
• Target: 8-12% rental yield + 3-5% appreciation

E-commerce:

• Dropshipping or private label
• Amazon FBA or Shopify
• Target: 15-30% ROI after initial setup

Online businesses:

• SaaS products (your tech skills!)
• Digital courses or content
• Affiliate sites
• Target: 20-50%+ ROI for successful products

Small local businesses:

• Laundromats, car washes
• Vending machines
• Storage facilities
• Target: 12-20% ROI

The Tradeoff

These investments require more work than passive index funds (which return 7-10% historically), but less work than a full-time job. This middle ground is perfect for Coast FIRE phase.

Time commitment: 5-20 hours/week depending on investment type

Real-World Example: The Amsterdam to Lisbon Path

Meet Alex, a software engineer:

Phase 1: Accumulation (Years 1-4)

• Started at €80k in local Polish company
• Prepared for big tech interviews (6 months)
• Joined Google Amsterdam at €140k
• Promoted to senior after 2 years (€170k)
• Saved €45k-€60k/year = €210k total

Phase 2: Transition (Year 4-5)

• Invested €200k in rental properties in Lisbon
• Generated €24k/year rental income (12% yield)
• Negotiated remote work with Google
• Moved to Lisbon (€36k/year costs)

Phase 3: Coast FIRE (Year 5+)

• Left Google for remote consulting (€60k/year)
• Rental income: €24k/year
• Consulting: €60k/year (€42k after tax)
• Total income: €66k/year
• Costs: €36k/year
• Savings: €30k/year while living dream lifestyle

Phase 4: Path to Full FIRE

• Reinvesting €30k/year
• After 4-5 more years: €400k+ invested
• Passive income: €48k-€60k/year
• Full FIRE achieved at age 37

Find your high-paying starting position →

Your Action Plan

Immediate (This Month)

1. Calculate your current savings rate
2. Research high-paying companies in Europe (see our company guide)
3. Start tracking monthly expenses to understand baseline
4. Join FIRE communities (Reddit r/EuropeFIRE, local Facebook groups)

Short-term (3-6 Months)

1. Prepare for interviews at high-paying companies
2. Visit 2-3 potential LCOL locations
3. Apply to 10-20 target companies
4. Build emergency fund (6 months expenses)

Medium-term (1-2 Years)

1. Land high-paying role (€100k-€150k+)
2. Establish saving habit (€30k-€50k/year)
3. Research investment opportunities
4. Make extended visits to LCOL locations

Long-term (3-5 Years)

1. Accumulate €100k-€250k in savings
2. Deploy capital into cash-flowing assets
3. Negotiate remote work or switch to remote-friendly company
4. Transition to LCOL location
5. Achieve Coast FIRE

Closing Thoughts

This blueprint is designed to offer a structured and strategic approach to achieving FIRE for software engineers in Europe. It blends high earning potential with the advantages of geo-arbitrage and smart investing.

Key principles:

• Earn aggressively in HCOL markets (3-5 years)
• Save consistently (50-70% of income)
• Invest actively for higher returns (15%+ target)
• Live strategically using geo-arbitrage
• Transition gradually through Coast FIRE
• Achieve freedom in 6-12 years

As you embark on this journey, remember to adapt the steps to fit your personal situation and goals. Always stay informed about the financial decisions you make.

With dedication and a well-executed plan, the path to financial independence and early retirement is not just a dream, but a reachable destination.

Our upcoming articles will dive into the nuances of choosing the right countries and companies during the accumulation phase, strategies for exploring LCOL locations, and methods to achieve 10-15% returns through active investing.

Start your FIRE journey today →

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Frequently Asked Questions

Is FIRE realistic for European software engineers?

Yes! European engineers have unique advantages: high salaries in HCOL cities (€100k-€250k), low costs in LCOL areas (€24k-€36k/year), and easy mobility across diverse economies. You can realistically achieve Coast FIRE in 3-6 years and Full FIRE in 6-12 years with focused execution.

How much do I need to save to reach Coast FIRE in Europe?

€100k-€250k invested at 15% ROI generates €15k-€37.5k/year passive income. In LCOL European cities (Belgrade, Warsaw, Sofia, Valencia) where comfortable living costs €24k-€36k/year, you'd need €10k-€20k from part-time work to reach Coast FIRE. This is achievable in 3-6 years from high-paying roles.

What's the difference between Coast FIRE and Full FIRE?

Coast FIRE: Your investments cover most expenses, but you still work part-time/low-stress for remaining costs. Provides freedom to choose enjoyable work without financial pressure. Achievable in 3-6 years.

Full FIRE: Passive income covers 100% of expenses. Complete work-optional lifestyle. Typically achieved 3-6 years after Coast FIRE.

Coast FIRE is a comfortable middle ground that's faster to achieve and still provides substantial lifestyle freedom.

Is 15% ROI really achievable, or is that unrealistic?

15% ROI is achievable with active investing (not passive index funds). Examples:

• Real estate: 8-12% rental yield + 3-5% appreciation in growing LCOL markets
• E-commerce: 15-30% ROI on successful dropshipping/FBA businesses
• Online businesses: 20-50%+ for SaaS, courses, content sites
• Small businesses: 12-20% from laundromats, vending, storage

Tradeoff: Requires 5-20 hours/week vs. passive investing (7-10% returns). Perfect for Coast FIRE phase.

Which European cities are best for the accumulation phase?

Highest savings potential:

• Zurich (€70k-€110k/year) - Best for fast accumulation
• London (€50k-€80k/year) - Largest job market
• Amsterdam (€48k-€75k/year) - Great work-life balance
• Dublin (€50k-€80k/year) - English-speaking, big tech hub

See our guides on top cities for software engineers and how to reach €140k+.

Which countries are best for the Coast FIRE phase?

Best LCOL destinations for Coast FIRE:

• Poland (Warsaw, Kraków) - €30k/year, vibrant cities, B2B tax benefits
• Portugal (Lisbon, Porto) - €36k/year, digital nomad hub, ocean lifestyle
• Spain (Valencia, Málaga) - €30k-€36k/year, beaches, sunshine
• Serbia (Belgrade) - €24k/year, friendly culture, nightlife
• Bulgaria (Sofia) - €22k/year, mountains, very affordable

All offer high quality of life, good infrastructure, and welcoming expat communities. See our top 20 cities guide.

Should I pursue FIRE if I actually enjoy my tech job?

FIRE isn't about hating work—it's about financial freedom to choose. Many engineers in Coast/Full FIRE continue working because:

• They enjoy the work but want flexibility to say no
• They can pursue passion projects without income pressure
• They work part-time on interesting problems without stress
• They have security to take risks (startup equity, entrepreneurship)

Think of FIRE as building options, not necessarily quitting tech entirely. You can always keep coding—but on your terms.

What if I already have a family? Is this plan still viable?

Yes, with modifications. With children, add €10k-€30k/year to expenses:

• Timeline extends by 2-4 years
• Target higher initial salary (€150k-€200k vs €100k-€150k)
• Choose family-friendly LCOL locations (good schools, healthcare)
• May need €150k-€300k in savings vs €100k-€250k

Many families successfully pursue FIRE—it just requires higher savings rates during accumulation phase. The payoff is more time with family during their formative years.