Should I Go For FIRE (Financial Independence, Retire Early)?
I actually saw this question on Reddit and I feel like a lot of people our age are curious about FIRE or at least the idea of what it is.
If you're not familiar with it, FIRE stands for "financial independence, retire early".
The cornerstone of the FIRE movement is living extremely frugally during your early working years to have a shot at retirement in your mid-30s or 40s.
You then save and invest a majority of your income to be able to hit one of these numbers below, which are based on your desired income in retirement.
So for example if you wanted to live off of $40,000/year, based off the 4% rule, you would need $1,000,000 invested.
Now, it sounds and looks great on paper. But in practice, the lifestyle isn't always what it's cracked up to be.
And that's not to say FIRE isn't a good thing, but the most important aspect in my opinion is to really think through your desires and what life you want to live now, as well as in the future.
It's possible that you go into FIRE and then decide 10-15 years later that you're bored and want to go back to work.
(Or the plan didn't go as expected and you ran out of money)
And I also want to note that the strict savings mindset can be harmful to some people. In some situations, it can create a habit and shift of thinking to a point where you no longer want to spend money and this comment below is a perfect real life example of this:
So to answer the question - before you decide that you want to start saving a majority of your income and living extremely frugally, take some time to think about what you want your life to look and feel like. The FIRE lifestyle is definitely possible, but it takes a lot of intentional and dedicated savings habits.
There's no one-size-fits-all answer on this one but FIRE is an amazing option for those who want that lifestyle. Or it could feel restricting or meaningless for those who enjoy their work and wouldn't benefit from retiring in their 30s.
Here's an article from Business Insider that provides another perspective on the topic: The Moment I Knew FIRE Wasn't Right For Me