Passive coverage ratio
AssetsThe numbers shown come from a sample profile for illustration – in the calculator you see your own values.
The passive coverage ratio shows how much of your living costs is covered by ongoing passive income – dividends, interest or rental income that actually arrives in your account.
FIRE-relevant running costs (e.g. property service charges, repair reserves) are added to living costs because they continue in retirement too. Debt repayment is deliberately NOT included – it builds wealth rather than consuming it.
Difference from the FU ratio:The FU ratio is neutral to the type of investment and also accounts for accumulating ETFs (which do not pay out dividends). Passive coverage only counts income that actually flows – it puts ETF investors at a disadvantage compared with dividend collectors. That is why FireLotse shows the FU ratio as its main metric.
How it is calculated
Passive coverage = (passive income ÷ current budget need) × 100