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FIRE Philosophy – What the FIRE Crowd Gets That Everyone Else Misses

August 13, 2019

Those in the Financial Independence Retire Early (FIRE) movement often see things quite differently from the rest of society.

We’re a bit weird like that!  Or are we just an advanced version of human?  (only half joking lol) 😉

In this post, we’ll run through exactly what the FIRE philosophy is, and how the people following this path typically have a very different mental script to most people.

Despite all the numbers and analysis regularly thrown around, our focus isn’t really on money at all.  So let’s get into it.


FIRE Culture

The following is true for many people pursuing financial independence…

We enjoy finding ways to game the system.  Not by cheating, but by questioning the normal way things are done.  And we find money and investing to be an interesting topic to learn about.  Not for the love of money itself, but because it affects our lives in such a way that we can’t ignore its usefulness.

But sometimes, we’re seen in an unusual light.  We get called out for our whacky approach to life.  For not following the standard approach of working 40-50 hours a week for 40-50 years.

We’re sometimes seen as dreamers, who aren’t in touch with reality.  Misguided millennials who’ve never seen real downturns like the GFC, that’ll come crawling right back to the workforce when the next crisis hits.

Or, it’s assumed we’re seen as a bunch of lucky high income earners who can’t relate to the financial realities of the average person.

And we’re often painted as frugal to the point of misery, because we hate working and can’t wait to retire by thirty so we can live in our van, while we dumpster dive for dinner and re-use our toilet paper, as we sit at the beach for the rest of our days.

Okay, I haven’t heard that word-for-word, but it’s often implied!  Whatever some say, I think there’s one undeniable life lesson that resonates with most in the FI community.


What’s Our Secret?

It’s this:  Time is our most precious resource.

Probably everyone hears this, and to a certain extent they believe it too.  But the difference with the FIRE crowd is, we take this to heart in a different way.

Our actions are more in harmony with this belief.  We’re working hard now, to create as much future free time as possible.

Over the course of a good life, more of our days are better spent on more valuable things, than being at the office/factory/worksite.  And by getting our finances sorted, and money behind us, we’re able to make that belief a reality.  Effectively, we’re able to re-allocate our time. 

Suppose a two person household spends $50,000 per year.  For this couple to fund one year of freedom, it would cost $50,000.

If they’re both working full-time and earning solid incomes, it would likely only take a year or two to save $50,000.  This means, for 1-2 years they work, they could take an entire year off.

They’ve just purchased one year of freedom.  By managing their money well, they’re able to re-allocate their time and have every second or third year as complete freedom.  Pretty incredible.

Of course, an alternative is, they simply work part-time on an ongoing basis, to cover their modest spending.  This allows much more freedom on a weekly basis, without waiting a year to save $50,000.

Obviously, there are a huge number of possibilities.  But this is just one example of how to think about money and time.  As I like to say, you’re not really spending your money, you’re spending your freedom.


Other Important Beliefs

Here’s a list of philosophical views that I hold personally, along with many in the FIRE community.  Do you share any of these beliefs?


A high payback job is a better goal than a high paying job.

Reaching Financial Independence allows you to choose your work based on satisfaction, rather than salary.  You can do work that means something to you – work that matters, regardless of what it pays, or whether it pays at all.  That’s why it’s so helpful to earn well and stack your money first, so you can then move into next phase where you become very selective about work chosen.


Our individual actions do make a difference.

Many people on this path are quite conscientious people.  We realise that our habits and lifestyle choices are affecting the planet in either a positive or negative way.  Many regular folks feel this way too, but I notice it more acutely in the FIRE space.  Perhaps it’s a trait of ‘big thinking’ and seeing the larger picture.  It’s a belief that there is always something we can do to improve our situation (whether its financial, environmental or other).


Material possessions and status are pretty empty goals.

Many people are (often subconsciously) driven by these factors, though few will admit it.  I certainly was back in the day.  But even if we succeed in attaining the level of wealth and luxury we want, it’s unlikely to satisfy us.  There is always another level of opulence to reach.  Always someone richer than you.  Always another way to elevate your lifestyle.  It’s an unwinnable game.  And that’s why opting out makes sense, because…


Happiness is possible with very little.

How many people around the world are happy with a fraction of the luxuries we enjoy?  My guess is somewhere between a ton, and a shitload.  So chasing more money to buy more stuff and exotic experiences (as above) is simply unnecessary, and a distraction from actually building a meaningful life with great health, good relationships, and meaningful things to spend your time on.


Saving is what allows you to become rich.

Not through achieving ultra-high returns from investing.  Many try and shortcut this by taking on massive leverage or risky bets.  And some succeed.  But the vast majority of the time, wealth is created by saving money first.  The compounding and big investment gains come later.  Without first focusing on saving, you’ll never develop the underrated skill of managing money which will serve you for a lifetime.


Taking responsibility gives you power.

Your current situation might not be your fault.  But it’s up to you what happens from here.  Holding yourself accountable is the only way forward.  You’re probably aware that many people are busy complaining about how hard life is, how expensive things are, and how everything is outside our control.  But when you decide that your future is largely determined by your own choices, you start to move in a different way, make more progress and feel better about your life.


There’s no substitute for taking action.

Many wait for opportunities to come knocking.  Many wait for the perfect time to invest.  Or they wait until they’re earning more to start saving.  But the time to start is always right now.  People on the FIRE path tend to make things happen by being proactive and taking small steps on a regular basis to improve their lives.  With each step, momentum builds and this encourages more action.


What’s the point of Financial Independence?

To me, it means building freedom and optionality in your life.  It doesn’t mean dropping out of society.  And it doesn’t mean never working again.

It means having the choice to work on anything we feel is worth spending our time on, while we’re lucky enough to be on this earth.  Doing things that matter.  Not for money or prestige.  But because it’s genuinely worthwhile for its own sake.

And I don’t mean just traditional work.  That can include raising children.  Spending time on our health or spirituality.  Doing community work.  Building a business.  Or simply creating better relationships and living a much more balanced life.

Financial Independence is about having the flexibility to work less (or not at all), if more important things come up.  Or if we just want to take an extended break and dedicate our energies elsewhere.  It doesn’t have to be all or nothing.  Work can be scaled up and down as desired.


Re-writing History

There’s an old saying we’re all familiar with that I’ve been thinking about for a while.  “Time is money.”

This saying is no doubt true, to a point.  We spend time being productive, at work or in our business, and we earn money.  But I see it a little differently.  Rather than accepting, yes time is money, what if there’s another way to look at this?

Instead of Time = Money… I think: Money = Time.

Why?  Because any money we save and grow can create free time at any point in the future, like our example earlier in this post.  So, maybe we’ve had it backwards all these years!

My mission is to change people’s relationship with money.  So they can see it’s not just for splashing around and creating some short-term highs.  It’s way more powerful than that!  If used correctly, the need to trade our time for money simply disappears.

So, rather than trading our lives away for money forever, let’s make a plan, and spread the word!

We’ll get our spending under control, so there is always surplus cash.  We’ll build a strong and unwavering savings habit and increase it over time, as we get better at optimising our costs.  And we’ll get our money working for us, to create a passive income stream that grows over time.

As we build our savings and investments, we’re able to buy ourselves greater amounts of free time.  Until we get to the magical place where it’s all free time!

Rather than 20-30 years of freedom in our later years, where we might want to kick back and do a bit of travel or play golf, the FIRE crowd is often looking at 50-70 years of ‘retirement’.  And with modern medicine and technology, it could even stretch further!


Final Thoughts

I hope you can see that the FIRE movement, and the philosophy behind it, is much more about life than it is about money.

Money is just the tool, but life is the focus.

With all that free time, we’ll still need to be productive members of society to live our best lives.  And we’ll be happy doing so.  But we get to do it from a position of financial strength and freedom.  Choosing where and what we allocate our time to.  And that’s a wonderful way to live!

If you know someone who doesn’t quite ‘get’ what all this FIRE stuff is about, maybe send them this post or discuss the ideas behind it.

Thanks for reading, and I’ll see you on the other side 🙂

Do you share these life philosophies?  Or do you have other lessons to live by?  Share your thoughts in the comments…


35 Replies to “FIRE Philosophy – What the FIRE Crowd Gets That Everyone Else Misses”

  1. Another very good article. I will forward it to one person.

    My own motivation for seeking early financial independence was perhaps different from yours. It turns out that I really loved my job as a software engineer for most of my working life. However, I was around when Australia had “the recession we had to have”, so I aimed for financial independence just in case Australia experienced another recession and I became long-term unemployed. It was a sort of Plan B. I could probably have retired at the age of 30 with a very modest investment income, but at the time I was still enjoying my job so I kept working (and kept investing). In the last two years of my working life, the nature of my workplace changed dramatically and I lost the passion for my work. At the age of 37, I quit my job and decided to take a year off before looking for other work. But I found that I was enjoying my new work-free life, so I never did resume my career. I now have the time (there’s that word) to do all the things I love, and I can spend more time looking after my health (I’ve never been more fit). I still enjoy writing software as a hobby, and I have found lots of new interests. I am in a good place right now.

    1. Thanks Robert! That’s fantastic. You provided some great reminders there – a great work situation now can get old in a few years. That’s the great part about FI – almost everyone will continue doing some work, but it will be for the enjoyment of it and a sense of purpose rather than needing the money – and it can be as part of a better balanced lifestyle overall.

  2. Yes, yes and yes! All of this speaks to me so much and is what I’m all about. I really look forward to mirroring this message tomorrow night and in future to anyone who questions ‘why’

    See you soon,

  3. Long time reader of your blog my first comment though. Your blog is very down to earth and informative. Great post. FIRE to me is smart people striving not just to be financially independent but more importantly to have choices, flexibility and freedom in life. Keep up the fantastic work, thanks again.

  4. There was an interesting post on Greater Fool today about a 32-year-old guy who wrote suggesting he wanted to ‘retire’ in 8 years… the blogger had a go at him and then it continued in the comments section. Always an interesting cross section of responses for something like this, and one person made the analogy of weight loss. Everyone knows the formula, but not that many people have the discipline. I think that’s a massive part of the FIRE culture as well.

    1. Haha there is always some who are irritated by the thought of FI/RE – I think they get a little too hung up or serious about the ‘retire early’ part. It’s a good comparison – it will probably always be a smallish amount of the population I think. But with a little luck and the right messaging, hopefully we can make it a bit larger than that!

  5. Being judged as a dreaming millennial high-income earner who is frugal to the point of misery is the look I seem to get when I explain my FI ambitions to friends. Even though I have managed to get into a nice house, decent car, and occasionally go out. I just don’t spend money on thriveless stuff. I save and invest so that I can add true value to my life.
    Another great down to earth article!

    1. Thanks for the comment Rohan. Great to see you’re bucking the trend and forging your own path! That can be very hard for some people. In 10 years time some of these folks will probably call you ‘lucky’ to make themselves feel better about not being in the same position as you.

  6. great article mate. looking forward to when I hit FI.

    In relation to time, I read an article recently on burnout and it stated “Start living, stop existing”. So true.

  7. Excellent points made! Lately I work so physically hard, the I collapse too tired to do anything, or even be bothered to cook healthy food. Moneys OK but whats the point? there needs to be a point other than the money itself. One needs to keep ones eye on the prize and to do that one needs to remember what the prize actually is. It is possible to become addicted to work and money for moneys own sake, in which case one will never be able to retire because one would never be able to let a dollar get away that it was possible to have. For this person life is money and your money truly is your life.

    1. Great insight James! So true. I remember having the same feelings you’re describing. Continually trading your life away for more dollars/luxuries just isn’t worth it at all!

  8. Good stuff mate. I’d also add that FIRE folks are much more able to visualize the future – which in a way, contributes to our ability to practice a rather extended version of delayed gratification.
    Also whoever said that you can’t buy time obviously hasn’t heard of FIRE 🙂

  9. Time = Money
    Money = Time
    So simple yet so profound…
    Great article Dave; I will forward it to a few people that will benefit from your wisdom!!

  10. Dave this is GOLD, your article.
    ‘ Saving is what allows you to become rich. Not through achieving ultra-high returns from investing. Many try and shortcut this by taking on massive leverage or risky bets. And some succeed. But the vast majority of the time, wealth is created by reducing spending and saving money to invest. Invested wisely, these savings will earn more dollars and multiply over time. Without first focusing on saving, you’ll never develop the underrated skill of managing money which will serve you a lifetime ‘.
    Love your work, keep it coming

  11. Fantastic, thought-provoking post. Thank you!

    I am going slowly towards FI whilst working part time and sometimes I feel like I’m taking the soft path. Your post reminds me about the huge benefit I am enjoying and why it is the right decision for now. I just need to keep on working on all the levers I can pull.

    1. Your welcome Girt! Awesome to hear about your approach – first comment from someone going for FI while working part-time. It’s definitely not ‘soft’, because you’ve obviously got your money sorted in such a way that FI is still coming down the road, while you enjoy some freedom now – and that’s fantastic!

      1. I’m with Girt on this one. I consider myself semi-retired already, working part of the year to cover current living expenses and then taking the rest off to travel. I’m leaving my index fund portfolio untouched to grow to my FI number over time, while I enjoy a better work-life balance for me now.

  12. Another great article. What you said is so true “We’re seen as mere dreamers, who aren’t in touch with reality”. Now, I carefully select to whom I am sharing my thoughts on being FIRE. 🙁

    My husband and I have a target of fatFIRE. We are currently working fulltime and staying the course.

    1. Thanks! Great job committing to your goal – I think it takes a level of courage to be an independent thinker and strive for FIRE.

  13. Hi Dave, Good post – but don’t confuse most people looking to FIRE with yourself. You are unique – you actually did it and live it. My personal observations with people over the years just don’t match the scale you’re talking about. Most people never really FIRE any earlier than at least 50 – they want more and more money to Fat fire (ugh) or some other obscure arbitrary thing. Ultimately it comes down to excuses. Most value money over their time – including most so called FIRE disciples who are always on the journey but never quite reaching the destination. Unlike yourself.

    1. Interesting viewpoint Christopher. You might be right there – the lure of ‘one more year’ for more wealth accumulation becomes a sort of comfort zone for some people. And the excuses thing is no doubt true – I guess part of my job (and that of the FI community) is to take away those excuses by sharing different examples and strategies of what’s possible.

      But I also think it’s fair to say that there are so few published examples of FI because the concept is only recently growing in popularity (last 5 years or so). So my view is that in 10 year’s time, there will be many more examples of folks who are living it, with a range of circumstances, simply because by then it’s been well known about for long enough that more people have gone out and done it. Well, I hope that’s the case anyway! 🙂

  14. From our family background, we were more concentrated on property rather than share. We have not any ideas about shares until we start reading share books to understand the terminology of stocks. Thanks to Pete Wargent, he refers your website when I read his book this year. I was so procrastinated to start buying shares last year. After reading Anthony’s book (master the money game, he recommended buying low cost funds), more and more successful stock buyers would recommend low cost fund too. It made me think, index fund is a way to go. If we could put 10% of our income buying share every year, sign up dividend reinvestment plan, if we could continue doing it for coming 20 years then we should build a fair bit money to fund our travel after retirement. You can start from few thousand for share, not like property, you need lots of money, maintenance cost are lot higher. For average income earner in Australian, we might knew buying property in Sydney or Melbourne, but most of average earner can’t afford over $1,000,000 property. Even you can afford it but negative gearing properly sent you to bankrupt or over stretch, and create sleepless nights. I have been reading top stock 2019 (2020 version should come out soon). I check the recommended stocks and look at the index fund top investment stock and choose it. I will keep reading books and search for index funds, the index fund you recommended are pretty good, over 4% dividend yield. Forwarded your website to friends.

    1. Hi Jessica, thanks for your comment. I appreciate you sharing your story and the lessons learned!
      Your plan sounds very sensible and as long as you keep adding regularly, your portfolio should grow nicely over the next 20 years as you said. All the best and thanks for sharing the blog 🙂

  15. One of your best posts! So much terrific stuff in here.

    “Of course, an alternative is, they simply work part-time on an ongoing basis, to cover their modest spending. This allows much more freedom on a weekly basis.”

    This is us at the moment! We are nowhere near FI, having just begun the journey last month, but we own our house and cars and have modest expenses freeing us to both work part time, especially while our munchkins are little. We could both work full time and put them in daycare and save like crazy to be FI in 7-10 years (our savings rate would be astronomical!) but we place more value on spending time with them while they are little more. In 10 years they may not want to spend time with us anymore!

    1. That’s an excellent position to be in, congrats! No need to go crazy with it since you’re already enjoying some freedom. Take it easy, enjoy the kids, and every incremental investment will cover a bit more of your remaining spending, creating more future freedom a little chunk at a time 😀

  16. I think I was born to do FIRE.. in fact, from the day I earned my first pay, even before I knew there was such a movement, I was questioning WHY. Why do people take their paycheck, spend all of it and rinse and repeat until they are about to die… why not spend less, save the rest up and quit the workforce. If you’re going to have to sell the prime time of your life (20-50) – it better be worth something for later.

    Anyway, I’m 45 now and have been following the FIRE movement the last couple of years. I have nothing to add to the already impressive collection of ideas and tips by the blogging community.

    I’ll just say if you intend to make a family while at it, it’s super important to do life with a partner who is also totally on board and wired the same. I’m fortunate in this sense and now we have 3 kids who are more or less wise with money (at the very least understands the opportunity cost of money).

    My long term goal is hiking. All over the world. To all the famous tracks and less trodden local treasures alike. I want to quit full time work in 5 years time. Wish me luck!

    All my best wishes to all on this path.

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