Early Retirement – An Insight into the FIRE Movement
Keywords – FIRE movement
Most of us don’t like the prospect of working all our lives.
That is the idea behind the FIRE movement – it stands for Financial Independence, Retire Early. It is the movement catching the attention of many millennials who want the luxury of retiring as early as in their 30s.
FIRE movement gives traction to the practice of either increasing your income, and/or decreasing your expenses and living as frugally as possible to maximise your savings rate.
It is an aggressive saving method where the average 10 – 15% saving rule is thrown out of the window and as much as 60% of an individual’s income is put to savings.
The idea of saving 60% of one’s income seems ridiculous, but it is possible with the help of extreme budgeting and frugal living.
The FIRE movement doesn’t mean once you have retired early that your income will cease. If you have invested money wisely, retiring early will take away from a difficult day job but any investments will continue to return income.
How to join the FIRE movement
If the thought of retiring early in comfort by living a frugal life appeals to you, you will be wanting to know how you can join in. At a personal level, we are not big fans of the idea. But, it is an interesting concept to explore.
Track Your Spending
It is easier said than done, but one of the key elements of successfully joining the FIRE movement is tracking every penny you spend – literally. This includes everything from your morning coffee to an evening snack.
Once you have tracked your spending over the course of one month or so, calculate where you can budget and spend less to help you save more.
The FIRE movement is a firm believer of every little helps.
This is a subtopic to tracking your spending.
In order to adhere to FIRE, you must question every spending decision you make.
When you work, you are giving your time and energy to a job or business in exchange for money. Let’s say you are earning £20 per hour and you see a pair of designer shoes that will set you back £200. You should be able to step back and assess whether 10 hours of your time is worth the pair of shoes.
The chances are, you will reconsider and perhaps go for a cheaper alternative for a fraction of the cost.
There are many people joining the FIRE movement. So, you have the perfect opportunity to reach out to fellow super savers for advice and support.
And, want to learn more? Get in touch today.