What is the FIRE Movement? (Financial Independence, Retire Early)

The FIRE movement is an acronym that stands for Financial Independence, Retire Early. FIRE followers are typically young professionals who have the goal of achieving financial independence and retiring early in life. The FIRE movement has grown in popularity over the past few years with more people starting to question their career choices and what they want out of life. This blog post will help you understand what FIRE is, how it can help you achieve your goals, and why so many people are jumping on board!

The FIRE Community

The FIRE community is made up mostly of Millennials who are willing to do whatever it takes financially so they can avoid having jobs during retirement. FIRE followers feel that life is too short and want to enjoy everything about their lives instead of working long hours at a job they don’t like. Some people may think FIRE members are crazy for quitting such stable jobs, but remember: FIRE isn’t just about retiring early — it’s also about financial independence!

People who retire early aren’t any different than those who continue to work until the standard retirement age (e.g., 65). The only thing that sets FIRE members apart from others is how much money they save up over time… which means spending less and saving more throughout your entire life as an adult.

Types of FIRE

FIRE comes in all shapes and sizes. There are many different ways to achieve financial independence, but there is one thing that they all have in common: you need a high savings rate! Some people will be able to reach FIRE quickly while others may take decades before reaching their goal.


This is the type of person who has made the difficult decision to live very leanly in their retirement and has decided to save aggressively in the present to facilitate their early retirement. This allows them to save, and build a moderate FIRE investment egg for themselves and their family. This category typically has low-moderate incomes which forces them to save up more in order to reach FIRE faster.


This is the name for those who want to retire early, but want to make sure they have enough room in their portfolio and their budget for a great life after retirement. Most FatFIRE followers want to aim for an annual retirement income of $100,000 or so, depending on their needs. There may be many reasons for a person to opt for working a bit longer and developing their portfolio and investments a bit more than someone striving for LeanFIRE, but in my opinion, this is the best way to set a reasonable goal of retiring early, but also planning to have a much larger nest egg when they do, to account for unforeseen circumstances, market shifts and general desires and needs one has when they get older. This is also a very good FIRE strategy for high-income earners who for whatever reason hate their job but still make a great income. Putting up with the undesirable work for as long as you can grow that FIRE investment egg to take care of you when you are ready to retire.


Probably more commonly known as BaristaFIRE, this is a strategy that involves retiring early (can be anywhere between LeanFIRE and FatFIRE) but also keeping a low-stress job, something to keep you active, and take care of the day-to-day expenses. This strategy is a very smart way to retire with the freedom of early retirement, with the small income available to you from doing a part-time or low-stress job to take care of many of your extra expenses, also adding to your retirement egg while (Semi)retired!


Okay, I might be the first to coin this term, I’m not sure. This is what my FIRE plan has always been, even before I even knew what FIRE was. OwnerFIRE is an investment strategy for entrepreneurs, not a retirement strategy.

OwnerFIRE is making smart investments that will generate income for you to live off of. So, instead of putting $1.2m in a bank and living off of it, invest that $1.2m in a business you either run yourself or with a business partner you trust. This investment in a business will give you a far superior ROI than a high-interest bank account, and more than likely will grow in both capital investment as well as income over the long term.

Now, I can hear you all shouting at your screens. There is not a business model on the planet that is stable enough for this kind of FIRE model, and I am crazy for proposing it. You’re 100% correct, and there is no sure-fire way to do this. It takes some research, some planning, and definitely some experience to make it work.

However, all of these FIRE strategies involve some risk and are all fallible. If you dump all of your FIRE egg into the stock market, the risk is also obvious. Poor returns or a market crash has devastating consequences for investors. Hello, 2008!

At least being the owner of a business that you control, and (perhaps) operate means you shift much of the responsibility and burden of performance onto the person you (should) trust the most in the world. After all, if you are interested in FIRE, you are trusting yourself enough to conceive, calculate and execute a 20-, 30-, and sometimes even 40-year FIRE retirement plan with perfect insight, right?

The Dangers of FIRE

Personally, I think the best way to retire early isn’t to grow a massive egg of money and let it sit in a bank or a “safe investment” for the next 30 years while you live off of a set salary every month.

There are a lot of unforeseen aspects of your life that you don’t necessarily plan for when you are 20, 30, or even 40. You can’t foresee what’s going to happen, or what life is going to throw at you in 5 years, let alone in 50 (for those planning their life from the juvenile blinders of their 20s).

You just don’t know enough about your own destiny to chart a course for your life in your 20s, or even your 30’s. You can make guesses, but for those of you who are considering some form of LeanFIRE, you may not be taking into consideration that life is expensive.

If you are planning on retiring at age 40 and living off of a retirement salary of say, $2,000 a month for the rest of your life, you just may not be taking into account that your circumstances may change, and your goals and your expenses will shift down the line. For instance, if you are unmarried, have no kids, and are planning a retirement in your 20s, you need to at least plan for a partner in your life, how they may or may not embrace your FIRE life, and how that affects plans for kids. Kids are ‘spensive, yo!

My main concern with a pencil-thin-margin-for-error strategy like LeanFIRE is that a bunch of well-meaning, but premature retirees have to re-enter the workforce in their 50s because medical science makes breakthroughs, and everyone is living to 100 years old now. In this scenario, I guarantee you didn’t plan for this kind of longevity in your LeanFIRE calculations.


I hope that this post has helped you to become more educated about the FIRE movement. It is important that you understand its potential benefits and risks before deciding if it’s right for you or not. For those of us who are pursuing a different path, don’t be discouraged! Our blog offers plenty of resources on how to save money in other ways so that one day we can retire comfortably too. Have any questions? Ask away! We’re happy to help out as much as possible with our knowledge base at your disposal.

Further reading