FIRE Sweeps Millennials

FIRE Sweeps Millennials

It’s the latest thing and it’s particularly hot with the millennial generation: FIRE.

The acronym stands for financial independence, retire early. The conventional retirement drill is simple enough: work hard for 45 years, while saving and investing 10-15% of your earnings. This approach traditionally guaranteed a worry-free retirement. If it ain’t broke, don’t fix it – right? It might not be that simple, after all, and the millennials may know better.

Millennials often don’t buy the conventional wisdom. FIRE initiates believe they can save up to half of their income by living with extreme frugality (“like Mahatma Gandhi,” perhaps, as Woody Allen said it). Supporters of FIRE believe, or dream, that the strategy will allow them to retire in their 40s, healthy, wealthy and just sufficiently wise. Can it be done?

Some naysayers don’t like the math – too many people who’ve followed the traditional path are finding themselves short of money in retirement – the increasing longevity trend is a two-edged sword. Others think it can work, but only for the truly rich. High-net-worth individuals might find FIRE an interesting choice: why keep slaving away if you have more than enough by middle age to live long and prosper? For the rest of us, alas, FIRE may be a deceptive fantasy.

One side of FIRE is often overlooked, though, an aspect that could change people’s minds about it. Retiring at 40 is a relative concept, it seems. Many people who follow the FIRE path merely leave their desk jobs and move into a variety of independent roles. Some start their own small businesses; others write or do freelance consulting work. Many professionals have acquired the skills to invest successfully in real estate or equity markets. After technically retiring, FIRE adherents could potentially end up earning more than they did in their conventional careers.

For more information, please read:
Retirement on FIRE | Wealth Management

 

Rich Women are Increasingly Calling the Shots An Aging Population Will Shape the Internet