How much is freedom worth to you?
I need to save $625,000.00 to purchase a magic money making machine that will print me $25,000.00 checks, once per year, every year, forever.
Joel of www.fi180.com – The Milestones of FI
If you have the ability to save up to buy such a magical money-making machine, would you? How soon would you start saving? I know my answer would be “YES!” and “RIGHT NOW! Take my money!”
Before you think I’m a crazy person (or that I’m trying to pitch you on yet-another-MLM scam) and that a money a machine like that does not exist, sit down and hear me out.
FIRE is an acronym which stands for Financial Independence / Retire Early. The cornerstone idea of this movement is quite simple:
- Spend less than you earn.
- Invest any surplus that you have.
- Avoid debt.
At the end of it, if you are diligent with the steps above, your investments will grow to a point where it is able to generate enough income each year to cover all of your expenses, forever.
Once you’re there, you’ll never need to work again!
(How do you know when you’ve reached that point? Check out my Introduction to the Safe Withdrawal Rate.)
But I enjoy my work, why would I want to pursue FIRE?
Don’t get me wrong, FIRE isn’t about not working and bumming around. It’s not about being anti-job. I know a lot of people who love their job for various things: it gives them purpose, a social circle and identity. FIRE is about giving you options. If you continue to work after you’ve reached FIRE then you have chosen to do so, you’re not forced to because you have to make enough to afford rent.
Financial independence means work becomes completely optional. You get to live life on your own terms. You get to choose to continue working or not. You get to choose to spend time pursuing your passion without any risk. You get to choose to spend your time with people important to you.
Essentially, you’ve purchased the ultimate luxury, freedom. Freedom to choose to spend your time on things you find important instead of being forced to work 9 to 5 in order to pay the bills.
How much is that worth to you? The answer to me is clear, and that’s why I’m on this journey to buy myself a magical money-making machine.
OK, I’m on board with that, but saving up enough to do that must take ages right?
Traditional wisdom expects us to graduate in our 20s, work our butts off for 40 years and finally being able to save up enough to retire at 65 (and our government is suggesting to move this up to 67.) Once there we hope to still have 30+ healthy years left to enjoy the fruits of our labor. Well within the FIRE movement, we call bullshit on that plan.
The magic of the FIRE-Path is that you can get from start to finish within 10 years, if you do it right.
Most finance blogs out there show how people have done it in many countries around the world, but I will be going through how I’m making it happen here in Singapore.
So if the concept of FIRE is appealing to you. If you’d like to start your very own journey towards FIRE. If you’d like to see whether I’ll be able to get there and how I’m making my way there while living in one of the most expensive cities in the world. You’ll want to continue reading this blog and follow along on my journey.
You can also follow me on twitter if you want to have a conversation by tweeting @firepathlion! Thank you for reading!
See you on the other side!
FPL