Financial Independence and Retire Early (FIRE) is a "program" or a series of steps someone takes in order to be financially free with no constraints and retire earlier then the average person. Sounds like a dream come true right?
Now this dream can be started at any age and everyone's idea of FIRE is very different. FIRE usually includes saving the maximum amount possible (usually around 70% of their income) and investing heavily into the stock market, crypto market or real estate. When someone reaches FIRE, they usually have a large amount saved up (desired amount needed per year x 25) and take out a small sum of the savings each year.
Different Types Of FIRE
Now that you know a little bit about FIRE you are probably wondering how much you'll need. Well I'm going to walk you through all the different types of FIRE that currently exist, but just as a side note *there are no right or wrong in FIRE*
- FAT FIRE: This kind of FIRE technique is usually when someone saves up an extreme large amount, so that when they retire, they have a higher income then the average person is able to splurge their money on things they don't necessary need.
- LEAN FIRE: This kind of FIRE technique is usually where someone saves enough for minimalistic lifestyle and are content to live a "basic" lifestyle.
- BARISTA FIRE: This kind of FIRE technique is usually for someone who can quit their 9-5 job and has saved enough for their basic expenses to be covered but would still like to work part-time.
- COAST FIRE: This kind of FIRE technique is very similar to Barista FIRE. The only main big difference is that you may need to work more to cover expenses.
Some Ways To Start Your FIRE Journey!
Firstly, let me just start by saying you can start this FIRE journey in your teens, 20s, 30s, 40s or 50s, the sky is the limit.
- Join a Facebook group related to FIRE (or any other social media): I found that this could be super motivating and useful. You can learn all kinds of things from people who are on the same path or have already reached FIRE. Also it's always a good idea to surround yourself with people who want to or have achieved what you want in life.
- SAVE as much as possible: this is really important and I have an article about how to start saving money so check that out if you need help. I would say if you are trying to achieve FIRE, that a 50% savings rate would be a great goal to have but keep in mind to stay HAPPY!
- Invest at your own risk: Investing your money can be a great way to reach FIRE faster. Investing can sometimes be risky, so please take this into consideration. I have an article on investing in cryptocurrencies for beginners if that is something that interests you. Other investments to look at is stocks, bonds or real estate.
FIRE is a journey that anyone can take and just remember everyone started at ZERO, it's all about how much you want it and how much effort you put in.
1 Comments
hi
ReplyDelete