“FIRE” is a term that’s often mentioned in the early retirement community meaning Financial Independence / Retire Early. It’s the personally defined goal all early retirement bloggers are striving for when they initially start on their saving journey. FIRE can be broken down by their two different, but related terms.
Financial Independence is defined as the stage in which someone’s passive income pays for their living needs. At this stage you would no longer need your regular paycheck as you have passive investments you could live off (ex. real estate rentals, pension, or dividends and capital gains from the stock market, royalties, etc.) and you’re free to work on things that may interest you, you may work for a cause, or perhaps become a entrepreneur. The important part here is pay is not a primary motivator.
Retiring early is similar in that you have passive income to meet your needs, but you no longer want to work at all and live the life a more traditional retiree would live in their 60s, but perhaps achieve this in your 30s or 40s. At this early age you have more time to travel the world, volunteer with your time, or raise a family for example. Retired folks seem so stress free and happy when they are financially stable, why not get their sooner?
When I first graduated college all I wanted to do was enter the workforce and make money as soon as possible. I had a hard time staying motivated at school, but as soon as you incentivised me with money to perform, I was game. I didn’t take much time off after my senior year in college to pick one of my 5 offers (Cisco, GE, IBM, Level3 Communications, and my current company) and off I went happily putting in many hours to learn my trade, collect those bonuses and salary increases. Back then my college friends and I poured over our offers as if it validated all our work in our education up until this point. Multiple companies were valuating us on their terms, in a sense betting on us for how well we’d perform in the rat-race as opposed to us educated, young minds defining what was valuable to us. I felt like I made a real difference back then as a Network Engineer and I was constantly learning things. In those days paying off my college debt was a priority and I kicked that in two years, but soon after the next logical step for me was to buy a place. I would have been lucky to have broken even after fees and selling/buying so often, but likely not. I also got caught up in material things, namely motorcycles, cars, tech gadgets and tools which certainly has delayed reaching FIRE, but I wasn’t aware of the concept back then and only later did I figure out I set myself back quite a bit.
If I only knew then what I know now, I would not have pursued some of those shorter term purchasing goals as my focus would have shifted from obtaining happiness from things to happiness from experiences and freedom. With that shift I would have been retired or financially independent by now. But unfortunately as my enthusiasm for the corporate life wore off, I continued to make purchases that only brought me temporary enjoyment. In the end I was still working for the man (who continues to treat me well in a lot of respects to be quite honest) and each day was seemingly like Groundhog Day. The job wasn’t changing much, getting more stressful over time, and those shiny things I purchased weren’t so shiny anymore. Over time I woke up and started to look forward to my complete freedom and become FIRE as soon as possible.
I figure if I am lucky enough to live to 90 years old, I will spend about half my life doing what others have told me, whether that was my parents telling me to do my chores, my teachers to study, or my employer to work hard. The other half of my life will be on my terms, to travel as I please, to spend time with friends and family, to volunteer, to play a greater role in my nieces’ lives, to help my parents as they get older, and to ultimately do what ~I~ want. FIRE gives me that ultimate freedom in life. When I’m at the old folk’s home I won’t remember how many nice clothes I bought over time to fit in, how many awards I received at work, nor all the motorcycles/cars I owned and how I modified them, let alone the cost. While I appreciate my career, in the end it is a tool to achieve other goals. When I reach FIRE I will cherish that freedom and lack of work stress for as many years as possible, and sit back in my rocking chair appreciating what I ~did~ experience in life over what I wish I would have back before my body became too frail and too many doors have closed.