Welcome to FIRE in the UK, a personal finance and financial independence website. You can read more about me here.
I’ll Let You Into a Secret
This isn’t actually a website about money. Not really. It’s just masquerading as one. It’s actually about living a happier life. Money is the tool to help you do that – it’s a means to an end, rather than the end itself.
Money is an inescapable part of life. You can either learn how it works and make it work for you, or you’ll have to work for it, forever.
To avoid that fate, you need to become financially independent. But what is financial independence? What is FIRE? How do you achieve it? Read on for an introduction to the FIRE fundamentals.
Financial Independence
Achieving financial independence (FI) means that you never have to earn money again if you don’t want to. Your assets cover your expenses.
There are three mains paths that people use to reach to reach FI:
- Investing in the stock market, most commonly in index tracker funds
- Property
- Starting a business
You can choose one, two or all three of these routes. Everyone’s path is different.
The FIRE movement was originally made popular by Vicki Robin and Joe Dominguez’s book, Your Money or Your Life, which was published in 1992. Vicki and Joe had been doing seminars in the United States for a number of years prior to the book being published.
In more recent years, in the internet era, blogs like JL Collins, Millennial Revolution and Mr Money Mustache, as well as forums on popular websites like Reddit, have gained large followings, especially amongst millennials.
FIRE
FIRE, sometimes written as FI/RE, is an acronym for financial independence, retire early. It’s a community, or movement, of people who save a large percentage of their income, typically between 25-70%, in order to reach FI. Once you’ve reached FI, you can carry on working, whether that’s full-time, part-time, freelance, or any other way you choose, or you can “retire”. Retire is in quotes because reaching FI doesn’t mean that you can’t ever earn money again; it means that you don’t have to.
The Different Flavours of FIRE
Some people want to reach FI as soon as possible. Some people want to live a luxurious life. Some people are happy working part-time. And some people don’t care about retiring early, they just want to know that when they retire at the traditional retirement age, they can do it in comfort.
You can read about the different flavours of FIRE here.
How Much Do I Need to Reach FI?
I wrote a separate post covering in detail how to calculate how much money you need.
When Will I Be Able to Retire?
See this brilliant post from Mr Mustache, which has a handy table showing you how long it will take based on what percentage of your income you save.
There you have it, the fundamentals you need to know before digging deeper. Again, welcome. It’s great to have you here. Make sure you subscribe below.