The (ability to) retire early part is the primary thing that makes the Financial Independence Retire Early (FIRE) community different from all the other personal finance approaches. We CAN retire early, and we as a community should own it.
The following chart illustrates how FIRE principles compare to that of other, non-FIRE personal finance voices:
| Personal Finance Principle | FIRE Community | CFPs, financial counselors, Dave Ramsey, Suze Orman, 50-30-20, et al. |
| Track Spending | X | X |
| Budget | X | X |
| Separate discretionary and non-discretionary spending | X | X |
| Make cuts from spending to enable savings | X | X |
| Increase income | X | X |
| Pay off consumer debt | X | X |
| Build strong emergency fund | X | X |
| Tax planning | X | X |
| Save and invest | X | X |
| Savings percentage target (i.e., time to retirement choice) | 40, 50, 60%+ (ability to retire 20 plus years earlier and much earlier than age 62) | 10-20% (retire at traditional age 62-67) |
As you can see, most of the principles are essentially the same. The key difference that sets the FIRE community apart is the high savings rate and the ability to retire early.
The push for a high savings rate has driven the community to devise creative ways to reduce spending and/or increase income to achieve that savings rate, while still maintaining a quality lifestyle. It is the prospect of early retirement that drives the high savings rate and the subsequent ingenuity to achieve it.
The RE part of FIRE is what attracts media attention and gets people reading the MMM blog, listening to ChooseFI, and engaging with so many other FIRE content creators. Without the RE, we would be essentially the same as all of the other voices in the personal finance space.
The RE is what drew me into the FIRE movement. I learned about FI in 2017, and I was super excited about the prospect of early retirement. (I honestly didn’t realize I could buck the norm.) I left my government job in 2020 at age 52. While the FIRE community shares lots of interesting and valuable resources on personal finance, it only hooked me because of the RE option.
Even though I later worked full time for one year in a new career field (personal finance education for the military), I didn’t HAVE to work. By achieving full FIRE (i.e., the ability to retire) I have the complete menu of life options to do whatever I want and to weather any financial storm (OK, except maybe not the zombie apocalypse).
Naysayers of RE
We often hear members of the FIRE community, including numerous FIRE content creators, complain about the RE part of the FIRE acronym. They say things such as the following:
- I don’t want to have to retire and just sit around on a beach all day–I’d be bored.
Achieving FIRE means achieving Financial Independence with the ABILITY to Retire Early. But FIWTATRE is a long and crummy acronym, and FIRE is a really cool acronym.
Having the ability to retire never meant I must. It is my choice.
But even if you do retire, that doesn’t mean your only option is to sit on the beach all day or sit on the couch eating Cheetos all day. Seriously, we need to stop using these ridiculous binary stereotypes when describing early retirement.
FIRE community members think differently to include how they spend their time. I have yet to meet anyone who retired early and spent every day at the beach sipping fruity drinks. Even traditional mainstream retirees generally know to keep themselves engaged in interesting hobbies and connect with family and friends to enjoy their retirement. The list is long and fascinating of the many things financially independent, early retired people do with the time they’ve earned.
I got rid of work and other commitments that didn’t make the top of my list (such as maintaining a house and car), and I increased all of the things I wanted to do more of. I get plenty of sleep, stretch, travel full-time as a nomad, read, hike, walk, write posts for this blog, spend time with family and friends, and follow my curiosity. I easily fill my days and I am consistently happier and more content than I ever was working full time.
We as a community need to stop letting those on the outside define our terms for us.
- I love my job, so I don’t need to save so much money, because the RE part of FIRE isn’t my goal. I plan to work until I’m 65 (Coast FIRE, Barista FIRE, etc.).
I am sure there are a few jobs (as well as some self employment) out there that are amazing and enjoyable. But achieving RE is still the key to this movement because things can and often do change in our work lives. Changes that may make a person really glad they are financially independent and CAN retire early if they wish include:
- A new, terrible boss rolls in.
- Your company lays off employees due to downsizing, a merger, going out of business, etc.
- You’re injured and can no longer work.
- You change your mind about how great the job is.
- A pandemic strikes and closes down whole industries (to include many entrepreneurs).
- You decide to travel full time instead of working.
- Your parent or child needs more care than your job allows you to give.
- I’m sure there are many more good reasons.
The ability to retire early provides all job, sabbatical, and retirement options if (when) any of these events occur. While Coast FI and Barista FI are really cool options, they both still require some level of continued work and therefore they do not give you all the options and safety net of achieving full FIRE–the ability to retire early.
- People outside of the community call me a hypocrite when I claim to have achieved FIRE but continue to make money, so I think we should drop the RE part.
Why would we let the outside world control our narrative? RE means the ability to retire early. After achieving that, we can do anything we want, to include ignoring what naysayers are saying. If that somehow seems too hard, then just state that FIRE stands for Financial Independence Retirement Eligible.
- Retiring means I can’t work any more.
Nope. Many traditional mainstream retirees work for money (gasp!). Why would FIRE retirees be any different? Again, the RE is not mandated retirement, but rather having all the choices to design a life that the ability to retire enables.
- It sounds nice to retire early, but I don’t want to be deprived or unhappy to get there.
This is just not true. Being frugal and saving money actually has its own rewards, and it does not have to cause deprivation and unhappiness. A frugal life can actually be happier. As modern-day philosopher Naval Ravikant explains, “Money doesn’t buy happiness – it buys freedom.”
Conclusion
FI = 25 X expenses = passive income covers expenses = ability to not work = RE
We don’t need to rebrand FIRE to somehow get rid of the RE. We need to own and embrace the RE and control the narrative on its definition–the ability to retire early. Instead of diluting the definition of FIRE to include people who save 5-10% each year and retire at age 67 and labeling it “Career FI”, we need to embrace the higher savings rate that an early retirement goal drives. This is what sets us apart from the cacophony of all the other personal finance “experts.”
FIRE, all four letters of our acronym, are what make our movement powerful.
