The FIRE Movement: More Than Just Early Retirement
Financial Independence, Retire Early (FIRE) is a lifestyle movement focused on achieving financial freedom through intentional saving and investing.
What is FIRE?
FIRE stands for Financial Independence, Retire Early. It's a movement that has gained significant traction in recent years, particularly among millennials and Gen Z who are rethinking traditional retirement timelines.
The core philosophy is simple but powerful: by dramatically increasing your savings rate and investing wisely, you can accumulate enough wealth to retire decades earlier than the traditional retirement age of 65.
But FIRE isn't just about retiring early—it's about gaining the freedom to choose how you spend your time, whether that's pursuing passion projects, traveling, spending time with family, or continuing to work on your own terms.
The 4% Rule
The foundation of FIRE planning is the 4% Rule, which suggests you can safely withdraw 4% of your portfolio annually in retirement without running out of money over a 30-year period.
This means your FIRE Number (the amount you need to retire) is calculated as:
FIRE Number = Annual Expenses × 25
For example, if you need $40,000 per year to live comfortably, your FIRE number would be $1,000,000 ($40,000 × 25).
Key Principles of FIRE
High Savings Rate
FIRE followers typically save 50-70% of their income, far exceeding the traditional 10-15% recommendation. The higher your savings rate, the faster you reach financial independence.
Smart Investing
Most FIRE adherents invest in low-cost index funds and ETFs, taking advantage of compound growth over time. The focus is on consistent, long-term investing rather than trying to time the market.
Different Types of FIRE
FIRE isn't one-size-fits-all. Here are the main variations:
Lean FIRE
Living frugally with minimal expenses, typically retiring with a smaller nest egg.
Barista FIRE
Achieving partial financial independence while working part-time for benefits and extra income.
Fat FIRE
Retiring with a larger portfolio to maintain a more comfortable or luxurious lifestyle.
Ready to Start Your FIRE Journey?
The first step is understanding where you stand today and creating a clear plan for your future. Use our calculator to see when you could achieve financial independence.
Calculate Your FIRE Number