You may have at least heard of the acronym ‘FIRE’. There has been a lot of buzz in the air about it on social media and news lately. Just in case, though, I’ll spell it out. FIRE stands for Financial Independence Retire Early….although, really the RE is optional. I really should just have titled this blog ‘Why everyone should be aiming to FI’…but that doesn’t sound quite as good. A great alternative I have recently heard of for RE is Recreational Employment!

So what exactly is FIRE? FIRE is a movement of the personal finance community designed to take back your time and take control of your path in life.

Becoming financially independent or FI means that you have accumulated enough of a ‘nest egg’ or enough assets to generate sufficient income to cover the costs associated with your life. This can be money in cash, the stock market, real estate or any combinations of these and others.

Often times this DOES mean that earlier on in your career, you have increased your savings rate to more than the ‘average Joe’. Ex. If the traditional recommended savings rate is 10-15%, a FIRE minded saver might be aiming to save at least twice that. Your savings rate could be in the neighborhood of 30-40% of your income, or even up to the 50-70% range.

In the FIRE movement you often hear talk of a FIRE number. So what is this? This is basically your goal of how much money you would need to be financially independent or “FI”. In order to know what your FIRE number is, you need to know what your expenses are. A very basic example would be if your expenses are 40K/year, your FIRE number would be 25 times this value or 1,000,000. You could also use the 4% rule of thumb - multiplying 1,000,000 times 4%, which would equal 40K/year. It is important to keep in mind that this is just a VERY ballpark number - and often times changes as your life and needs change.

Some people do not find the movement until mid life so don’t worry! Anyone can start at any time…although of course, the earlier the better. There’s an old Chinese proverb that you probably have heard of…The best time to plant a tree was 20 years ago. The second best time is right now.

OK now that we know what FIRE is, let’s get into it why I think everyone should be aiming to achieve it.

This is a little bit about my story. I worked for 16 years at the same mostly small animal practice. I honestly thought I would be there my entire career. I enjoyed the work, the clients and the pets. It was fairly stressful but hey, it’s veterinary medicine! Everyone’s stressed out, right?

About 8-9 years ago I discovered the FIRE community through various blogs and podcasts. At the time, I was saving probably about 15-20% of my income. I thought I was doing pretty good. After the discovery of FIRE, I was saving between 40-70% of my income. I was able to do this because I lived in a low cost of living area and the military was helping me pay off my veterinary student loans. Now fast forward 4-5 years and I was seriously getting burnt out. My income and savings rate were the highest they had ever been but I was also just kind of miserable. I wasn’t FI but I had saved quite a bit.

So last year I made the leap. I left my job, sold my house this past June and about a month ago moved across country. I’ve taken a new job with actually minimal benefits but that will hopefully increase my quality of life.

This brings me to the first reason I believe everyone should be aiming to FIRE.

Had I not had any savings, I would have felt trapped in a job that I no longer loved. I would not have taken on the challenge of taking this alternative path and who knows how long I would have been stuck? It gave me that ability to make some life changes. In my case, I didn’t stop working. I just shook things up a little and made some choices based on QUALITY of life and not QUANTITY of money.

Another way to think about it is way less anxiety and stress. With your FIRE savings plan (or as I have heard it called, financial safety blanket), even if you don’t get to your FIRE number (which can be a moving target anyway), you will be way better off than if you had continued on with the status quo/keeping up with the Joneses’.

Each of our family situations is different. I happen to be unmarried with no kids, (other than 2 furry ones.) I know many people are married and have kids or are married with no kids. No matter what your situation…Aiming for financial independence will help you and your loved ones feel secure. Get laid off? You have savings to pay bills and take care of your family while you figure something out.

How many times have you pushed your body so far in this profession? I had trained myself into believing that THIS level of stress was normal. You say it will only be this one time but it keeps happening day after day, week after week, month after month. When are you going to prioritize your health - eating better, sleeping enough, making time to exercise? Having your financial safety blanket can allow you to do all of these things.

The last reason everyone should be aiming to FIRE (although certainly not the least reason) is Time. Time is actually the only nonrenewable resource. You can usually find a way to make more money. With time… you get what you get. You maybe can increase that amount of time by prioritizing your health a little more (which brings us back to the previous reason) but so many times we put those things off that we want to do into a distant utopian future. Someday I’ll travel to Australia. Someday, I’ll take the kids on a National park road trip. Someday….. All of a sudden, you look up and you’re 70 years old, still working and your health is starting to fail. Time doesn’t care. Why not do some of these things when you are healthy and still have time? (I know there are a lot of healthy 70 year olds out there but its not guaranteed.)

You might say to yourself, ‘I love my job and I don’t want to FIRE’. This is OK! You don’t have to! Forget the RE but not the FI part. Others may say, ‘I don’t want to live on rice and beans’. Again, you don’t have to! Most FIRE minded folks spend lavishly on the things that are important to them but save where it’s not. What IS important to you? I love to travel and will spend money on experiences that take me to amazing places. However, I don’t really care about having a big, fancy house or a lot of physical THINGS. Again, It’s ok if you do like your big house or your boat or any other physical things you have in your life. Everyone has different things that are important to them and FIRE is just a tool to help you get there.

So I ask you today to consider TRULY prioritizing your freedom, your security, your family, your health and your time. Consider aiming to FIRE.

Why everyone should be aiming to FIRE

I was forced to time the market (kinda) and this was the result.

Chautauqua Columbia September 3-10, 2022