They will tell you; we’ve been conned… They will save, pretty much, everything that they earn… I think it’s extreme, but they’ll drink box wine, instead of bottled wine… It’s such an old concept that it’s new again…— Warren Ingram, Galileo Capital
FIRE is an acronym for “Financial Independence and Early Retirement”.
It’s a movement gathering momentum in the USA and elsewhere.
Financial independence is fairly well understood by now.
It refers to having sufficient assets so that you can earn an income from them that will cover your lifestyle costs.
Generally, most people work throughout their adult lives to achieve financial independence.
FIRE turns the concept on its head by getting people to focus on what they would need as a bare minimum to get by every day and from there they work out how to achieve this minimum standard.
This would involve asking yourself questions like:
Do we need two cars (as a couple), or do you need a big SUV?
Do you need the latest smartphone?
Why do you need to live in a big city and in a house with more bedrooms than inhabitants?
Can you grow your own food – not as a hobby but as part of your daily existence?
Can you barter your excess produce with others for things that you need?
- If you are not able to stop working completely, can you live a largely FIRE existence already so that you can save 45% to 75% of your salary to reach FIRE?
Most people who belong to the FIRE movement continue to do some side jobs (gig economy) but they are able to earn sporadic income from these gigs without undue financial strain and so the additional income becomes a bonus for luxuries rather than necessities.
Some people in the FIRE movement are quite extreme, but their principles are valuable and provide some interesting insights as to our priorities as investors and savers.
Are you prioritising your life correctly and spending your time/money accordingly?
For more detail - and inspiration - listen to the interview in the audio below.
Enjoy The Money Show, but miss it sometimes?
Get the best bits emailed to you daily, right after it ends:
Get the 10 most-read articles of the week from Bruce Whitfield’s The Money Show, emailed to you every Friday morning:
Recommendedby NEWSROOM AI
Small business guru Pavlo Phitidis gives advice to a listener who has an opportunity to turn a tiny business into a massive one.
Don’t be dumb with money like many smart people! Bruce Whitfield interviews Personal Financial Advisor Warren Ingram.
Flew SA Express lately? You’re lucky to be alive! Bruce Whitfield interviews SA Civil Aviation Authority CEO Poppy Khoza.
Tiger Brands reported a 16% drop in half-year earnings. Bruce Whitfield interviews its CEO Lawrence MacDougall.
For your assets to generate an income that lasts as long as you do; here’s what you’ll need to amass (and tips for getting there)…
Bruce Whitfield interviews Smart who, at the age of 52, is retiring, and looking forward to a more “purposeful” second life.
Johannesburg father, Chris says he had just come back from work when he walked in on an employee raping his 17 year old daughter.
Pan Africanist Congress's Narius Moloto explains why it supports the name Azania, a word which he says has Arabic origins.
Join Joburgers from all walks of life come together peacefully, united in their diversity for a fun family day out.
Marli van Breda's ex took the stand in the trial of triple murder accused Henri van Breda.
Zuma says he cannot be expected to act against Minister Bathabile Dlamini on social grants matter now before the ConCourt.
Commission says investigation into food and agro processing companies is important because of high levels of inequality in SA.
WIN R2000! But only if you can prove you're a whiz of the MTN Biz Quiz by answering the following three questions...
Is social trend Blesserfinder, where girls are allegedly matching up with rich 'benefactors' in exchange for sex, a real thing?