Financial Independence, Retire Early — FIRE.
We won’t waste your time here — let’s get right to it!
What is the FIRE Movement?
The FIRE Movement, which finds its roots in the 1992 book Your Money or Your Life, by Vicki Robin and Joe Dominguez, regained its momentum in the 2010s when millennials entered the corporate (and by extension the financial) markets.
The FIRE Movement propagates the idea that you must take steps to ensure you save money, gain financial independence, and retire early. Sounds like a dream, doesn’t it? A lot of people thought the same and were dismissive of the FIRE Movement. And while it started out as an almost militant concept that demanded you live below your means and save money to retire early (which is not at all what young investors today want), the core foundation of the concept — one that demands financial independence and freedom — remains more relevant today than it ever was.
Investors today want to save for short-term goals like travel and experiences just as much as (if not more than) they want to save for the long term. So, it is highly unlikely that they would consider giving up their lifestyle of today for tomorrow — because the present is as important as the future.
It is safe to say that a singular financial strategy cannot be applied universally to every individual. You have to consider your income, fixed expenses, taxes, unbudgeted expenses, and finally your short-term and long-term goals — and all those things are variable factors depending on the individual. So, the final goal of the FIRE Movement, which is to create financial independence through freedom and flexibility, is met by choosing from various methods of the FIRE Movement.
FIRE Movement Methods
It is important to remember that while early retirement is a focus of the FIRE Movement (and may have been the main reason for the Movement to gain popularity, to begin with), it is not the only aim of this movement. Some people might want to save for a life event in 10 years’ time, some might be saving for a foreseeable expense in a year’s time, and some might be saving to retire in 30 years. So, to match these diverse demands of investors, the FIRE Movement has identified three key methods to help you make the right investments –