What is F.I.R.E.?
The shortest possible summary of the F.I.R.E. movement, Financial Independence, Retire Early, is this: it’s a movement which advocates saving and investing as much of your money as possible to achieve financial independence.
The concept was first introduced in 1992 when Vicki Robins and Joe Dominguez published the book “Your Money or Your Life.” The book challenges readers to think differently about consumerism, money, and the value of their time. It sparked a movement called the “New Roots Movement,” which focused on achieving financial independence by living and thinking differently.
The F.I.R.E. principles can help most people achieve financial independence within 10 years or so. However, it’s important to note that there is no magic formula or easy button. It requires hard work and discipline. This blog provides tools, a community, accountability, and new ideas to help you accelerate your path to F.I.R.E.
By following the F.I.R.E. principles, you can change your life and achieve financial independence. The principles are simple, but applying them can be challenging. The goal is to save and invest a large portion of your income, eliminate debt, and reduce unnecessary expenses. By doing so, you can build a portfolio that generates enough passive income to support your lifestyle without needing to work.
Achieving financial independence and retiring early may sound too good to be true, but it’s not. The F.I.R.E. movement provides timeless advice and principles that work for most people who are willing to put in the effort.
Are you ready to start your journey towards financial independence and retiring early? If so, let’s begin!
IN YOUR RETIREMENT
 |
Rule of 25 | 4% Rule | ||
| You'll need this much money invested: | If you want this much money... | |||
| PER DAY: | PER MONTH: | PER YEAR: | ||
| FAT FIRE | $5,000,000 | $548 | $16,667 | $200,000 |
| $4,000,000 | $438 | $13,333 | $160,000 | |
| $3,750,000 | $411 | $12,500 | $150,000 | |
| $3,500,000 | $384 | $11,667 | $140,000 | |
| $3,250,000 | $356 | $10,883 | $130,000 | |
| $3,000,000 | $329 | $10,000 | $120,000 | |
| $2,750,000 | $301 | $9,167 | $110,000 | |
| FIRE | $2,500,000 | $274 | $8,333 | $100,000 |
| $2,250,000 | $247 | $7,500 | $90,000 | |
| $2,000,000 | $219 | $6,667 | $80,000 | |
| $1,750,000 | $192 | $5,833 | $70,000 | |
| $1,500,000 | $164 | $5,000 | $60,000 | |
| $1,250,000 | $137 | $4,167 | $50,000 | |
| LEAN FIRE | $1,000,000 | $110 | $3,333 | $40,000 |
| $750,000 | $82 | $2,500 | $30,000 | |
| $500,000 | $55 | $1,667 | $20,000 | |
| $250,000 | $27 | $833 | $10,000 | |
Rule of 25:
How to use simple math to find your savings goal.
Retirement is a stage in life that most of us look forward to, but have you ever wondered how much money you need to retire comfortably?
Well, wonder no more! There is a simple rule called the “Rule of 25” that can help you determine how much money you need to achieve F.I.R.E.
So, what is the Rule of 25? The Rule of 25 is a retirement strategy that states you need to have saved 25 times your annual expenses before you can retire. This includes the money you save and invest to replace your current income. For example, if you spend $50,000 per year, you need to save $1.25 million before you can retire.
The Rule of 25 is a popular strategy for people who want to achieve financial independence and retire early. The idea is to save and invest aggressively so that you can reach a point where you don’t have to work for money anymore.
Achieving F.I.R.E. requires discipline, hard work, and smart financial decisions. You should consider factors such as your age, income, lifestyle, and retirement goals when planning for your retirement. The Rule of 25 is a great place to start, but it’s important to note that everyone’s financial situation is different.
We created the financial calculators on our site to help you get started on your journey.
The 4% Rule:
How much of your portfolio can you spend each year without running out of money?
The 4% rule is a guideline that suggests how much money you can safely withdraw from your investments each year without running out of money.
The rule is based on the assumption that you will invest in a mix of stocks and bonds, and that your portfolio will return an average of 6-7% per year.
Under the 4% rule, you would withdraw 4% of your portfolio value in the first year of retirement, and then adjust the amount withdrawn each year for inflation.
For example, if you had a $1 million portfolio and withdrew $40,000 in the first year of retirement, you would withdraw $41,200 in the second year (assuming a 3% inflation rate).
While the 4% rule is a helpful guideline, it’s important to keep in mind that it’s based on historical returns and may not be accurate in all market conditions. Nonetheless, it can be a useful tool for those planning for retirement.
