Huge FIRE Movement: Financial Independence = Retire Early?
Updated on May 9th, 2020
FI or FIRE
Notice I left off the RE, as in FIRE, in the name of this site. I did this purposely since financial independence means different things to different people and it doesn’t necessarily mean to retire early.
Many people do equate financial independence and early retirement as two of the same and there are plenty of stories out there where the connection is told as exactly that. Most people hate their jobs, and so the idea of kicking back on a beach with some mimosas gives us that warm dream we would all love to enjoy right now.
Some even hate their jobs so much they are willing to save 60%+ of their income and sacrifice life to plan for “extreme early retirement” where they set a goal to retire in their 20s. In many ways it’s kind of ridiculous to be talking about retirement in your 20s.
I don’t advocate for early retirement in the traditional sense, I advocate financial independence to allow people to give their life purpose. By all means if that is a beach and mimosa, then do what makes you happy.
Most of us spend 8+ hours a day making our bosses look good at the expense of our precious time. If we could suddenly free up that time, we have to fill that hole somehow. You need to figure out how to fill that hole before you make the leap. Otherwise, you might find the beach after 2 weeks to be extremely boring.
Financial independence might be a vessel for volunteering or even working in a job that you enjoy, not for income purposes, but to give your life fulfilling purpose or to do something you have always wanted to do but couldn’t make a living out of doing it.
Financial Independence is More Than Retirement
Financial Independence is the bigger picture than retiring early. It’s about having freedom to do what you want to do with plentiful options. You can have those mimosas on the beach, or you can still work for your employer, but you don’t have to! You can fire your boss and go work somewhere else even if it pays you less because you can afford the trade-off of a higher quality of life for less money.
Financial Independence does mean saving, investing, creating independent wealth and having a personal finance strategy that goes beyond what your parents did and what your neighbors do. Financial independence is literally the price of freedom.
You can be financially independent if you are a man or a woman and you don’t have to make $100,000 a year. There are many routes to the same result and there are no set of steps or a guide that you have to follow to get there. Do not make excuses as to why you cannot gain financial independence!
For me, retirement means not being chained to a desk inside of a cubicle for the next 30 years working for someone else. While I might not have a traditional 9-5 job, I am the type of person who will always keep myself busy spending hours a week researching stocks, reading, learning, writing, and working on business ventures.
But I want the freedom to do this living anywhere in the world without having to be somewhere every week day at 9am. The best way to learn another language is to live in the country where it is spoken, right?
Creating Passive Income Streams Is the Answer to Financial Independence
When you have plenty of passive income assets dumping money into your accounts and does not require you to trade your time for money, you are walking down the path of financial independence. There are many great passive income investments that do exactly that:
Those three passive income ideas are the bread and butter core of my passive income dividend portfolio that beats the market.
There are no guarantees that you will do the same, but it also helps to understand index investing and to avoid the many ways of losing money in the stock market before starting out.
I hope this site will help you achieve your goals of financial independence, even if that means retiring early.
Free Personal Finance Tools
Offers a FREE analysis of allocation, diversification and fees for your 401k and IRA accounts and provides a new recommended allocation.
- FREE Net Worth tracker: All your accounts in one place for a total connected picture of your assets and liabilities.
- FREE Investment checkups and recommendations on your current accounts.
Offers FREE privacy credit card numbers (single use or maximum transaction limit) for online shopping. Free $5 for using this link.
Offers a completely FREE Health Savings Account (HSA) for individuals without a single fee for anything. HSAs have been one of the biggest fee grabs since they were created so I am glad to have found this. HSAs for the 2019 tax year can be funded up until 6/15/2020.
All-in-one platform of banking, investing and personal loans for a full money management solution.
- Cool Feature: You can setup automatic portfolio ‘pies’ or mimic expert ones for free.
- Cool Feature: You can use your stock investments as collateral to get an instant, no-paperwork loan to pay off credit card debt, student loans, auto-loans, home improvement or whatever. Because it is secured against equity collateral, they are able to offer super low interest rates as low as 2%.
- Instant access to your money through a checking account and debit card.
- All commission-free: fractional shares, automatic dividend reinvestment and re-balancing included.
Commission-free investing and trading with automatic dividend reinvestment and fractional shares for small purchases.
- Cool Feature: Social Investing, follow friends or other investors and see a feed of their buys, sells, current holdings, and how much they made on the trade. Ask questions and share insights. Say good-bye to random sock puppet trolls on stock message boards or FinTwit!
- Idea discovery with lists of stocks by themes such as cash-cow high dividend stocks, blockchain, green tech, recently-IPO’d, etc.
- Brand Investigator: Find brands connected to a particular stock.
- 2.5% interest on un-invested cash up to $10,000
Best Credit Card For Restaurant Lovers
The Capital One Savor card earns 4% cash back on restaurants (+2% Grocery). And there’s a $300 sign up bonus once you spend $3,000 on purchases.