Financial Independence Retire Early | How to Incorporate the Simple Fundamentals of FIRE

FIRE. You might have heard of the movement, or your first point of reference is man’s source of light. For those unfamiliar with the ideology, here is the “official” Wikipedia definition – “[FIRE] is a lifestyle movement whose goal is financial independence and retiring early. Those seeking to attain FIRE intentionally maximize their savings rate by finding ways to increase income or decrease expenses. The objective is to accumulate assets until the resulting passive income provides enough money for living expenses in perpetuity”.

In other words, it’s a group of people who aren’t in complete acceptance of consumerism and want to figure out a way to spend more time doing things that truly bring them joy. Like any other ideology, people are on a spectrum with FIRE. There are people who are extremely frugal, and will completely deject societal norms. Then, there are people who love a good shopping haul, but realize they can replace that morning Starbucks with homemade coffee to decrease their expense.

How to Incorporate FIRE into Your Life

1. Financial Independence

    a. Reducing Expenditure

Save, but don’t skimp on your happiness. Marie Kondo your life. What I mean is, tidy up the parts of your life that don’t add value to your life and simply eat away at your money and energy. Focus on the parts of your life that truly bring joy. Don’t hide behind the guise that your 4th pair of Nike Airs this year are bringing you happiness. No, that is only lighting up your brain’s pleasure centre until marketers tell you that those Nikes you just got are so passé.

Now, you may be saying – “WQ, my sneaker collection does bring me joy.” This might be true. Maybe the way the leather is sewn together really does give you p u r e  i n  t r i n s i c joy. However, my bet is that what you think is joy is really just a high.

    b.  Increase Income

This one is simple (in theory). All you have to do is, find a way to get paid more. I know, I know. If it was that easy to do legally, then you wouldn’t be here reading this post in the first place.

In a world where time is money, there are two ways to make money. One, you get paid in exchange for your time. For example, if you are a plumber, you are paid for the hours you take from your day to fix a leaky faucet. If you want to make more money in this fashion, you either take on more jobs, or you have to figure out a way to get paid more for your time.

Another way to generate income is to provide a product or service that does not have a linear relationship with time. To illustrate, picture a landlord who gets paid monthly for property that she owns. This has very little correlation to how much of her time she put in to provide this product or service. This type of income is called passive income. The classification of earnings where you are compensated for a product or service that has little or no relation to how much time you put in.

So, when it comes to increasing income, you have to figure out  how to get paid more for your time. This could be by increasing your per-hour rate (active income), or by increasing your time-non-conformist rate (passive income), or it could be a mélange of both.

2. Retire Early

Many people actually love their 9-to-5 (lol I am not one of them). However, many people (like me) are barely in like with our 9-to-5. For those of us struggling with our day jobs, we define retirement as the act of leaving a significant source of income at about age 62 in order to use our savings to live the life we want to live.

FIRE redefines retirement to be having the ability to leave a significant source of income  in order to live the life we want to live. No one in the community is saying, don’t work a single day in your life. That is not the point. The point is to not have to deal with ish you don’t want to deal with. Today, many of us are fortunate to have the bases of  Maslow’s Hierarchy of Needs met. So, as complex creatures, we crave mental stimulation. Omitting any sort of mental challenge from our day-to-day would be mental suicide. Do work. Do work that has meaning to you. Just find a way to be financial stable enough to retire the battery-drainer out of your life.

So, if you are sitting there recognizing that you aren’t spending time doing what brings you inherent joy. Then, ask yourself what’s stopping you from doing what you want to do? Is it truly that the alternate worst case is really that bad, or is it simply inaction because you are comfortable with the predictable?


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