Camp FIRE Finance
The FIRE Movement is a lifestyle choice with the end goal of financial independence and an optional early retirement. FIRE, an acronym standing for Financially Independent Retired Early, is based on two financial rules of thumb: The Rule of 25 and The 4% Rule.
Often called FI (rhymes with hi), Financial Independence is achieved with your living expenses can be met by income generated from your investments. Basically, one if financially free when working for a paycheck is optional.
Not everyone should pursue an early retirement, but everyone should pursue financial independence. Many in the FIRE movement have no intention of giving up work once they are FI.
Search the internet, and you see countless stories of people in their 30s, 40s, and in some extreme cases, their 20s, retiring early to live life on their own terms. It’s all part of the FIRE movement, which seems to grow increasingly popular by the day.
There is no law requiring you work until retirement age. Technically, there is no law requiring you work at all. But, I will assume you have bills to pay and you work to live (or live to work). In the United States, the average retirement age is 65 for men and 63 for women.
The FI/RE Movement or Financial Independence / Retire Early Movement is for individuals who decide to pursue financial independence as early as possible. In this post, I will cover one way to define financial independence, how to calculate your own FI/RE Number, and how to accelerate your roadmap to FI/RE.
The FIRE movement has its share of haters.
And honestly, I don’t get it. (Much.)
Sure, the biggest objections are understandable:
So let’s tackle those things one at a time. Doing so will help explain why right this very moment — with all the economic upheaval and ongoing problems — might be the exact right time to join the FIRE movement.
The FIRE movement, at its heart, is about blazing your own trail. Today’s writing will get this point across, and I’ll lead by example–we’re going to explore a bit. This article will be a winding road, but I hope you’ll trust me enough to guide you out to the other side. Grab your walking stick, and let’s set out.
We all know where the traditional life paths lead. It’s 40 years of 9-to-5 and working for the weekends. It’s using our 20s and 30s to bury ourselves in debt, only to use our 40s and 50s to dig ourselves out. And don’t forget about engaging in Cold Wars of one-upmanship with the neighbors and church group and PTA. Who does he think he is, driving a Tesla in this neighborhood?! This is what the Jones’ have done for generations.
The FIRE movement shirks those “traditions.” Vicki Robin—if she’s not an O.G. FIRE founder, I’m not sure who is—reminds us, “Money is something we trade our life energy for…The only real asset you have is time.” There’s an idea worth holding onto. The only real asset you have is time. We’ll come back to this idea. But first, a detour! Let’s go check out the steel mill…
Many people dream of becoming financially independent and retiring early, but it’s something that only a small percentage ever achieve. For most, work continues well into their sixties (and sometimes beyond), leaving little time to enjoy the fruits of their labor.
The idea behind FIRE (which stands for financial independence, retire early) is to provide the intellectual tools, resources, and support that people need to make early retirement a genuine possibility.