Our Path to FIRE (and why it wasn’t FIRE)
The traditional early retirement acronym, FIRE, draws many critics who accuse the adherents of turning against civilization and America to pursue their selfish self-interest instead!
However, what I’ve found through my own experience and working with my clients, is that many of the FIRE pursuers aren’t as interested in the “Retire Early” part of FIRE as they are the “Financial Independence” to do what they want.
Who Started the FIRE?
Let’s back up a bit and get on the same page. FIRE stand for “Financial Independence, Retire Early” and has officially been around for at least a decade and has often been attributed to ideas put forward in the book, Your Money or Your Life.
I read this book when I started my financial independence journey in 2009, impacting the way I thought about work.
The FIRE movement gained popularity among millennials and blew up in the social media/influencer world. Its main principles include keeping expenses minimal, saving 50-75% of your income to invest, and growing passive investments that will eventually replace the income from work.
Our Path to FIRE
Even though I started investing in high school and graduated from college with a degree in Finance and a minor in Economics, I still managed to go $50,000 in debt right out of college.
My first job with Accenture started at $42,000/yr, which I thought made me rich, but proved inadequate to keep up with my spending demands and a new car.
It took me a couple of years to realize I was going in the wrong direction, and that’s when I started to take my finances seriously and pay off my debt.
I used the Dave Ramsey approach, knocked out my debts, and started saving money before I married my wife in 2009.
She didn’t have any debt, so we started our marriage debt-free.
That’s when our financial trajectory took off, as we were saving one income and keeping our spending in check – even using a cash budget.
We bought our first house in New Orleans, renovated it, and the profits paid for our first adventure, an Around the World trip in 2013.
The profit covered the trip, which was quite expensive at around $60,000 in total. After an incredible year visiting 25 countries across five continents, we returned to the corporate world in 2014 with high incomes.
However, once you taste freedom, it’s hard to go back. We only lasted two more years until we quit our jobs in 2016 and officially retired early.
Our next adventure was living in our renovated vintage Airstream as we traveled around North America for a year, before intentionally settling down in a small town in Southeast Utah where we live today.
While we had enough assets and investments to sustain our minimalist lifestyles, we never planned to stay fully retired.
Instead, we were pursuing adventure and passions and working to figure out what was next.
Did We FIRE?
Looking back, we were only the first part of FIRE – Financially Independent.
We wanted to set our priorities with our time and life energy, instead of getting dictated by our employer.
Most people will never get the chance to explore.
College students might get a few months off after high school, and those who don’t go to college usually go straight to work.
After college, student loans force graduates to get a job a quickly as possible.
As if those challenges weren’t tricky enough, advertisers and engineers are good at getting us to spend money on things we don’t need.
The spending and earning cycle continues until the invented retirement age of 65 allows us to finally take a step off the treadmill.
However, we’re so exhausted that we have no energy left to pursue anything besides the couch.
I’m convinced that if we never would’ve taken the risk and traveled the world in 2013, it might not have changed for us either.
My frustration would have continued as I tried to make sense of my unhappiness when my rewards (opportunities and money) were great.
What’s Your Version of FIRE?
You might be in the same positions we went through on our FIRE journey. You might have that thing you want to do, but instead are stuck in your routine because the bills are due and the baby needs shoes.
It’s a perfectly respectable place to be, especially if it’s enabling you to save and invest to accomplish what you want in life. But will it ever allow you to do that thing you want to do?
It might help to rethink FIRE, and it might make pursuing your interests more reachable.
If you don’t have to worry about saving and investing enough to cover all your expenses for the rest of your life, you can instead focus on saving enough to allow you to explore.
Maybe you minimize your expense and save enough so you can take 1-2 years off without negatively impacting your family.
Maybe your kids are at a fun age when they still want to be around you, and you want to spend as much time with them as you can.
You can enjoy life now by making the finances work for you. Many companies offer unpaid leave as I took in 2013 when we traveled.
You can also buy your health insurance through the marketplace, but it’s not cheap.
There are even better strategies like planning for a year without “salary” income by selling stock and avoiding paying capital gains taxes.
You can also get credits from the healthcare marketplace if your income is low enough.
There are lots of little tricks to make this work. You need to make the decision, research, and make it happen.
How I Feel About FIRE Now
Looking back, I was on the FIRE path and read all of the FIRE blogs, but I never really considered us “FIRE’d.”
We didn’t live off beans and rice like we might have if we were fully FIRE because we were worried our investments weren’t large enough to fund our later years. Instead, we still traveled, explored, and lived a life we loved.
We became financially independent (FI), which allowed us to quit our jobs and slow down in life.
It allowed us to step off the treadmill and look around, listen to the world, and find our paths.
If we never became financially independent, I probably never would’ve started Adventure Wealth Advisors. I never would’ve felt comfortable enough to take the risk.
Becoming financially independent has allowed me to start my business and run it the way I want to, without having to “sell out” by doing work I don’t want to do or taking clients I don’t want to take.
I’m passionate about building a business, helping people find their freedom.
The FIRE concepts are probably the best way to find Financial Independence in life, even if you don’t plan on pursuing the Retire Early piece.
Instead, allow yourself to become independent of your need for a salary, even if it means only 1-2 years while you pursue another interest.
