Financial Independence Retire Early (FIRE) Movement
You may have heard of it. It's all the rage lately. Financial Independence Retire Early. FIRE.
But is it for real? What is it all about? Is it here to stay?
Early retirement. Passive income. Side hustling. Sequence of return risk. Debt payoff. Taxable vs. retirement accounts. Roth conversion ladders. These common FIRE terms are on fire right now (all pun intended).
Truth is, I think it's all bullshit. Don't get me wrong, I am all for financial freedom and financial independence, but I don't want to join a cult to do it. I also don't think that the only way to do it is with retirement as your sole motivator. As a matter of fact, let me argue why retirement is the worst possible goal to shoot for!
Why FIRE is Misleading...
Most of the financial independence community is very encouraging. Great tips and helpful information are shared like never before.
What concerns me is that personal finance is, well, personal. It is unique to your own individual needs. Your path to financial freedom and financial independence does not have to be based on retiring early, although it certainly can be.
Most of us want to work. Hell, most of us are looking for enjoyable work. Problem is, most of us hate what we are doing right now.
The people of the FIRE community tend to discuss passive income strategies that allow you to sip pina coladas at the beach all while having a $5/hr virtual assistant (VA) drop-shipping shit from China to customers. Sound like bullshit? Well, it is.
Yes, there is certainly money to be made this way. How long will that last? Who knows. It might last for decades. The problem is it doesn't seem to drive at the real problem here, your lack of purpose in life.
Early retirement does not seem to encourage a blood-thirsty pursuit of purpose in life. We all need purpose. Dr. Viktor Frankl famously discussed the importance of purpose in his personal true story about surviving the holocaust, Man's Search for Meaning.
The FIRE movement is centered on the concept of achieving your number, the target net worth and savings so that you can have F-you money and walk away from your job. I agree, having F-you money is very valuable in life. But the real value is in attaining that number so that you can do the things you really want to do in life.
Trust me, as badly as you think you want to, you really don't want to "retire". Retirement means doing nothing. The Oxford dictionary describes retirement as:
Retirement - "the action or fact of leaving one's job and ceasing to work"
That's not what I am looking for. I am not looking to cease working. I am looking to find more meaningful and purposeful work. Most of you are as well.
Early retirement is what happens when you treat money as a means to and end. Treating others, and things such as money, as a means to an end is very dangerous and leads to greater self suffering. This concept is hashed out in best-selling author Mark Manson's work Everything is F*cked: A Book About Hope.
What society certainly does not need is a bunch of "retired" 30 and 40 year olds, aka early retirees. What society does need is more people pursuing purposeful work.
If you have a problem with being told when to come and go from work, when to take vacation, and arbitrary rules, then I will be the first to inform you, so do I!
Reaching financial independence, for me, is about permitting myself to do the type of work and choosing my own suffering in exchange for long-term benefit. Manson introduces the concept of choosing your own suffering as a form of "self-limitation". His example is choosing to "suffer" through the pain of physical exercise in exchange for greater strength, endurance, mobility and improved health.
So What Are We Doing Instead of FIRE'ing Ourselves?
We are setting ourselves up to choose our own suffering.
When you are paycheck to paycheck, in debt, too much month at the end of the money, you are not in a position to choose your suffering. You need your current job with all the bullshit hours, rules, and demands that come along with it. You rarely can afford to step away and fully pursue your passion. You're stuck. Many of us are there. Many of us have been there for decades. Even I was there. It wasn't pretty.
25x annual expenses. 4% withdrawal rates. Geo-arbitrage. Passive income strategies. These are all examples of common FIRE terminology.
You can use any or all of these terms from the FIRE community, but use them not as a means to an end. I propose you use them, not to retire, but to find your purpose. A pivot on FIRE is relating to "work optional" status wherein you can choose to leave your current job at any time as you are financially secure.
I encourage you to separate the "FI" from "FIRE". Actually, just get rid of the damn "Retire Early" and focus solely on financial independence (FI).
Financial Independence permits many opportunities for you to no longer be beholden to your present job, especially if you dislike it greatly and do not find purpose in your work.
The biggest problem in the FIRE community is the underlying concept that we should eventually be able to attain a life with freedom to recline in a hammock everyday if we so choose. The major flaw of this underlying ideology is that there will always be a part of your life that will suck. Always.
Assuming that we are chasing an environment that completely avoids suffering and "the suck" is completely impractical and in and of itself, ironically leads to greater suffering. We suffer more, not less, when we assume that life should be completely devoid of pain and suffering. That's a complete falsehood. There will always be pain. Suffering. Suck. Always. It is not avoidable.
The real power is when you are in control of choosing your suffering. Physical exercise is a great example. Me sitting down and writing this damn post when I would rather do just about anything else, is another example. I am choosing to do this, rather than something else, with the concept that there will be some future return---hopefully the future return will be you getting your head out of your ass but only time will tell.
Leave your comment below. Love it or hate it, life is not about retiring. Going through your entire life with one goal, to retire, seems like just about the worst form of hell on earth. I challenge you to look further and realize that your problem is not that you are not retired, your problem is that you just haven't yet found out why you are important to the world, however big or small that importance may be.
Dr. Jon is a physical therapist by day, and a dedicated frugalist by night, deeply enthralled in the thrill of "pinching pennies" and investing the margin.