The acronym stands for Financially Independent / Retire Early. Several FIRE concepts were mapped out by a Baby Boomer in the early 1990’s. The philosophy behind today’s FIRE movement is very Millennial. The lessons are universal.
,While enjoying some time on the beach with my family earlier this week, the topic of discussion turned to saving and investing. My son inquired about putting some of his hard-earned money to work in the stock market. Then, he asked me what I knew about FIRE. As I looked quizzically at the remnants in the fire pit, I got a briefing on becoming financially independent and retiring early. From my Gen Z-er. Here’s what I learned:
The foundation of the FIRE movement was built in 1992. In ‘Your Money or Your Life’, Vicki Robin and Joe Dominguez developed a text that is part personal development guide and a personal finance workbook. They put forth a nine-step program aimed at enabling financial independence. Current-day evangelist Peter Adeney writes prolifically on FIRE topics through his Mr. Money Mustache blog which started in 2011. And the Financial Independence subreddit is a contemporary public forum addressing FIRE topics.
Key elements of FIRE philosophy include:
At its core, the FIRE movement encourages individuals to think through their relationship with money. Strict adherence to FIRE principles certainly isn’t for everyone. However, most people will benefit from the concepts of awareness, discipline, and judiciousness when it comes to spending and saving. The principles are great topics if you are discussing personal finances with young people. And you may be able to pick up some great pointers from financially engaged folks who are FIREd up!
Rob Kania is Principal and Co-Founder of Laurentide Advisory.