FIRE - doesn't it have to change based on expenses, inflation, and other factors?

The 25X expenses rule should be based on your 'expected retirement budget'. That's the foundation, and that needs to be realistic and 'correct' to base your FI number calculations.

We've been budgeting for years so we know our family's finances inside and out (for the area we live) which allows us to take our current monthly budget and estimate how it will be different when we enter retirement (ie, we won't have a mortgage so that comes our or our monthly budget, my wife and I will mostly be driving together so we can estimate a revised auto fuel budget, probably eating out a little more, etc). Once those numbers are estimated realistically, you can then look over your monthly list and figure out what's absolutely essential, and what's not. Multiply the 'essentials only' by 25X (or 20x) and get your 'Lean FI' number. Take the full budget and multiply it by 25X for your 'Full FI' number.

It all starts with your RETIREMENT budget though (in today's dollars). Approached that way, the '4% "rule" ' takes care of the effects of inflation.

Hope that clarifies things.

An Updated Google Sheet DIY Withdrawal Rate Toolbox (SWR Series Part 28) - Early Retirement Now

Second tab, "Cash Flow Assist"

Then enter the desired formula in the "Scaling of withdrawals. (e.g., model CPI+x%, spending smile, etc.)" column.

Normally speaking, I think inflation is built in if you do something like a 4% withdrawal rate. Unless you expect your expenses to change wildly from year to year, sticking to the 25x expenses should be pretty close.

That being said, if you want to plan for a variety of potential scenarios that could occur, you could do that with something like Empower (formerly Personal Capital). Once your information is in there, it can estimate your expenses based on spending and the retirement planner feature allows you to enter in a variety what if scenarios. For example, what if I receive an inheritance in 5 years, or go on a huge anniversary trip, or pay for college or a wedding, or retire in 5 years. It can then tell you your chance of success. I'm sure other tools are out there that do the same.

That depends on the model you are using. If you are using the standard "my expenses are X and will remain X, adjusted for inflation", then the standard model is fine. If, however, you expect substantial fluctuation in annual expenses, then you need a more sophisticated model. And it is just as important for expenses going down (e.g., "I will be helping the kids through college, and then those expenses will go away") as for expenses going up.