Financial Independence & Retire Early
Frequently Asked Questions

What does fire stand for?

FIRE stand for 'Financial Independence & Retire Early'.

What does fire mean?

FIRE is a personal finance movement in which people maximise their income and savings and minimise their expenditure in order to retire earlier than normally possible (I.E before the state pension age). It Usually means that you are completely debt free and have a passive income/pension large enough that you no longer need to work.

Are there different types of FIRE?

‍Yes! In fact there are four commonly recognized FIRE styles which are:

  • Fat FIRE - This is those who live a largely standard way of living but manage to save above average amounts. Usually done by those who are on what is considered a larger salary.
  • Barista FIRE - This is for those who have accumulated enough for their retirement plan but that work a part time job in order to cover their regular outgoings so that they do not eat into their savings pot.
  • Coast FIRE - Similar to Barista FIRE except they do not necessarily do it to cover their expenses. Done by those presumably who enjoy their job enough to carry on working or who just want to build on their already established retirement plan.
  • Lean FIRE - The most difficult by far but arguably the most rewarding, can be done by most people even when on an average income. Requires you to live frugal and minimalist lifestyle and saving every little penny you can. Not the most enjoyable way to do it, but an option nevertheless.

How much money do you need to FIRE?

Unfortunately there is no 'one-size-fits-all' amount when FIRE'ing. This is because it all depends on how old you are when you decide to start and at what age you plan to FIRE. There are plenty of online calculators to help you work this figure out. You can find them on my 'Tools' Page.

how do you achieve FIRE?

The main factors involved in achieving this holy grail of living are:

  • Debt Free
  • Own your home
  • Enough passive income/dividends/pension to cover your expenses
  • Excess savings so that you are able to enjoy your free time
  • A solid emergency fund

how long does it take to reach FIRE?

Again, unfortunately this does not have a blanket answer, it greatly depends on which FIRE style you are going for to start. Your income and ability to save are a huge factor and so are your personal circumstances. It is best to set yourself a conservative goal e.g if you start at 30, then give yourself 20 years. There are also calculators that can estimate at what age you can FIRE. You can find them on my 'Tools' Page.

Where can I find out more about FIRE?

In my humble opinion the best place to find out more is the visit the FIREUK Subreddit, its not very formal but it is very informative and full of useful information and tips.
Although not strictly FIRE, I strongly recommend following the UK Personal Finance flowchart. This will give you everything you need to get started.