What is the FIRE movement about?

The term FIRE, or Financial Independence, Retire Early was new to me, and I stumbled upon it maybe a year or so ago. Since then, I’ve been obsessed with reading about it on the various Reddit groups, and also reading up on some of the well known figures from within the FIRE community. Specifically those who have achieved financial independence and are now kinda retired.

For those new to this term, it simply means getting to a stage where you’re financially free to do whatever you want. Now, whether that means you retire and travel the world, or continue to work is entirely up to you. There’s been a lot of debate and discussion over the RE part of FIRE, and most agree that RE is more an option, but the bottom line is that you are free to pursue whatever your heart desires.

So, how do we achieve FIRE? Well, the formula is really simple. During the initial phase, you’re supposed to go into save mode. Save, save and save. Some people actually manage to save up to 70% of their annual salary! With the money you save, put those to good use by investing and compounding them, so that the money works harder for you, and hopefully, in ten to fifteen years, you should have built up a good enough nest egg that you can (if you choose to) not work, and live off the savings and investments you’ve built over time.

The idea that you can retire and do whatever pleases you way before 60 is definitely alluring, and from the accounts of these people, very do-able, provided you have the will power of erm.. a very strong willed person.

Some notable figures in the FIRE movement are:

• Mr Money Mustache, or Pete, is basically the Numero Uno in this community. His site is often cited, and he and his wife actually managed to retire in their early 30s waaaay back in the 2000s.
• Root of good. Justin ‘retired’ in 2013 at age 33. Using the same formula of saving a disproportionate amount of salary, living frugally and making wise investment decisions.
• The Mad FIentist. By analyzing tax codes and looking at personal finance from the lens of early retirement, he developed strategies, spreadsheets and tools to help us retire earlier.
• Our Next Life. They left their previous life of working and are now living their next life, of adventures and travels.
• Millennial Revolution. Started by two computer engineers who retired at age 31 and are now traveling the world.
• Retire by 40. Started by Joe who retired at 38 to become a Stay At Home Dad (SAHD) / Blogger.

There are many others also on the path to FI, and I’ll leave you to Google them but it’s definitely illuminating to read about their experiences and the way they see traditional retirement vs what they have achieved

Now, is this something that everyone can attain? Some detractors have pointed out that you need to be a high income earner to be able to achieve that, but I think if you know the formula and stick to it, even if you can’t retire in your 30s, you’ll still be much better off in the long run. Plus, retiring at 50 still sounds a lot better than 65, or never!