BEST Lessons From FIRE Even If You Don't Want To Retire Early

[@joethecomputerguy1]

I didn't her about FIRE until a few years ago. I graduated college in 1988. I told everyone I wanted to retire in my 40's. Most laughed it off as a young kid with a big unrealistic dream. Not my mom. She said if that is what I wanted to go for it. I did! I retired 6+ years ago at 52. No real regrets along the way. Go for your dreams!

[@ErinTalksMoney]

Love that!!!

[@beatricerights]

How did you do it?

[@joethecomputerguy1]

@@beatricerights Not trying to keep up with the Jones' is #1. Live below my income level is #2. If you don't know what that means well it means spend less than you make. #3 is use credit wisely meaning pay no interest on any credit card/pay off the balance every month. #4 track income, expenses, assets and liabilities and know exactly where every dollar goes. #5 Take advantage of every tax advantaged account available to you. This minimizes the income tax you pay and makes available money to save and invest. Bonus: you don't need investing home runs to win the early retirement game. I invested simply in the S&P 500 consistently. Starting early and being consistent works. Most people don't have that patience.

[@mymax43]

One of my close friends retired at the age of 38, that's 20 years ago, and he is still financially independent. Your first question might be the same one I asked him many years ago; "What did you do to retire so young?" He always said the same answer, "It's not what I did, it's what I didn't do...get married and have kids." Don't get the wrong idea about him; he has very good relationships with girlfriends and his sister's children. He just didn't want those financial commitments. The other factor that contributed is he is the cheapest person I know. He doesn't place a lot of importance on material things. He finds happiness in a way most of us envy, and I am one of them. He spends summers in Chicago and winters in Hawaii. The bottom line is that FIRE and happiness are possible but it usually come with sacrifice.

[@ErinTalksMoney]

To each their own! If that is his happiest path, that's wonderful for him!

[@southbound1969]

Summers in Chicago. So, he is a risk taker🙂

[@ErinTalksMoney]

😂😂

[@sharonbrown9721]

Thank you Erin. We have been saving to retire, always working and trying to be all in. However somewhere along the way we missed something. We are 56 and 59 and always wanted to travel outside the country to Italy and Germany, Time has a way of getting away from you so fast you don't even know it. Thanks for the reminder, My husband had cancer and everything but we seemed to fit right back in the status quo of working as hard as we can, Not sure what happened. Bottom line is we all only have a short amount of time here . Thank you ERIN for reminding us of this and bringing this to our attention. It's so easy to get swept up in the rat race. Keep doing your great work.

[@keithfrasier]

Thanks for the video Erin. I retired 10 years early at age 55 after working 35 years. I was able to do this not so much because I had saved a ton of money, but rather because I worked hard on reducing my expenses. (house below what the 'bank' said I could afford, always seeking low interest rates, used cars not new, Roku, cheap cell phone plans, credit card and bank 'churning' etc.) I'm very glad I did. Low expenses combined with even a modest IRA 401k and Pension was the right formula for me and my wife. Of course as you say, finance is personal, so each person has to find what works for them!

[@alexanderlyon]

I'd never heard FIRE explained as "recreational employment." That makes a lot of sense to me because I plan on doing some type of work until I can no longer physically or mentally do it even if it's a part-time passion-type job.

[@ErinTalksMoney]

Perhaps it's even a KZbin channel 😉

[@TBIhope]

I’m really proud of myself, because I just reached $50,000 invested between my IRA, 401(k), and some brokerage account money! This may seem low to some, but I’m only 25!

[@RandomJane104]

Good job! It isn't low. Keep it up.

[@jimk7964]

Congrats, I think that is an excellent savings amount at your age!

[@michaelwillis5814]

Wow great job keep it going 😮 great accomplishment

[@oherroprease207]

I’m 30 and only $1,000 away from the same number. I unfortunately was late to the party and started at 27. I’m still excited to see 50k though!!

[@michaelwillis5814]

@@oherroprease207 your not late try starting at 42 lol thts late the great thing is I'm committed n consistent

[@curtissouth916]

I love the new definition of FIRE. I know I will not want to quit working early. My parents retired at 80 and are going stir crazy trying to find stuff to do. I know I will be the same. I have been working since I was 13. the mandatory 1 month quarntine during COVID was a wake up call that I dont want to not work. But I want to set myself up to where I can take a job that is just fun, regardless of the pay. My uncle is wealthy and retired, only to go straight to work at a gun and flushing store. Just because he loves guns and fishing and meets all kinds of new people and stays up to date on his passions. That will be me.

[@ErinTalksMoney]

My parents are in their 70s - and neither can imagine fully retiring. They enjoy working - so I assume that I will likely follow a similar path. My husband and I just took a 7 day vacation, had a such a great time - and I am SO excited to be back to work today 😂. The break was amazing, but my real life is about 20X slower paced than our vacations.

[@traywaters1575]

That’s a really beautiful story about your uncle! I hope to do that too

[@dstevens518]

Excellent story and awesome to see someone so clear about where they're going

[@mere_cat]

Agreed. The idea of not working at first seemed great. But the more I thought about it, the more it seemed unfulfilling.

[@TheFirstRealChewy]

Yeah, I don't plan to retire, just find something else to do that I enjoy more. That freedom to do whatever will be great... we just need to reach FI, which is still a far way off.😅

[@tonyflaminio2719]

FIRE = Financial Independence > Recreation Employment …oh I like that. I had not heard that before. I probably need to read Your Money or Your Life. I wanted to retire at 57, when my FP said I could, it felt weird. So I waited a few more years. Knowing I can retire makes me feels good. Thx Erin

[@davidblack6413]

FIRE makes an extreme sport out of what are otherwise important tenets of financial success: start saving early, putting aside an increasing amount of your income as you progress in career; invest what you save in low-cost and well-diversified vehicles; under-consume relative to the cultural standard; work toward defined financial goals; and imagine a life, be it actual retirement or just more autonomy for yourself as to your choice of what, when and where you work, that provides financial independence. Not everyone is capable of hyper-saving or the performative frugality of FIRE purists. But we can take what they do, translate it into moderate and practical lessons in personal finance, and succeed as they do with less inconvenience and at a slower speed. Another excellent video, Erin. I do really enjoy these episodes of yours when you explore the culture of personal finance, rather than just focussing on numbers.

[@ErinTalksMoney]

Thanks David! I really enjoy exploring the psychology of money 😊🙏

[@bidergilette5356]

Great content! What is your job outside of KZbin? Thanks!

[@paul_domici]

I found out about FIRE when I was 55 : ) but financial independence is on the way !

[@cashflow68]

I started my FIRE journey back in the 1980's. Lived below my means, bought what i needed and not what I wanted. After 40 years raising a family of 4, I fully retired at 57. Im waiting 3 more years to apply for my max SS at age 70. Good video.

[@woodworker5413]

I talked with my son in his mid-20s about the FIRE movement a few years ago. The first half has the potential to give you freedom to do something you would like to do eventually. But life is always lived in the present. Tomorrow is not guaranteed, but wise choices in the present will tend to give you more options in the future.

[@leena118]

Great video as always. Reflects a lot of my thoughts on the FIRE movement as well. Definitely lots to learn from FIRE. I just take the lessons that work for me and leave the rest.

[@ErinTalksMoney]

100%! I think that attitude applies to most things in life!

[@wealthbytes]

I like the concept of Fire, but as you said, I like the FI part instead the RE part. It's more of getting to a point where you can just do a job or run a business because you want to, not because you have to.

[@ErinTalksMoney]

Absolutely!

[@robertrodriguez3614]

Thank you for the great content. Your points are so clear.

[@traywaters1575]

I hope you continue making KZbin videos for a long time. High quality channel with a great personality behind it (:

[@dstevens518]

Geez, you're nailing these videos time and again. So much good info packed into 10 minutes. You can tell you love your job, no one gets this good if they don't like it. Lucky us.😊

[@PH-md8xp]

Excellent perspective. I hadn’t heard about FIRE until about 2015 :) but had just intuitively saved aggressively mostly in my employer’s 401k plans, as soon as the 401k became law and throughout my career. I retired in 2020 with $1.2 million in my 401k and another $1.3 million in brokerage and Roth accounts. Financially I’m in a good place, but like you said, in America we’re so conditioned and focused on our work and career, that I’m having a bit of a difficult time adjusting to all the free time. I’m working with a life coach and I think it will prove to be very helpful. 😊

[@vulpixelful]

My goal is technically FIRE because I'm on track to retire in my 50s. But I'm still saving up for trips and fun stuff for the short term because, like you mentioned, health isn't guaranteed to last. I exercise and eat healthy, but sometimes things just happen 🤷🏾‍♀️ If I wasn't spending on extras now I could probably retire in my 40s. But it would be retiring to a "lesser life", with less trips and other fun stuff, so I can wait 😊

[@ErinTalksMoney]

I don't want to retire to a lesser life, I like your approach - work a bit longer and have a bit more freedom with my money today! 😊

[@kirtanvarasia3798]

Hi Erin, I have recently started watching your vlogs and I find the content really good and makes me think! Just wanted to say you are doing great.

[@TheBeagle1956]

My goal was to retire at age 55. I managed to retire at age 56, which was ten years ago. Since my health was an issue back then, I’m glad I was able to. At 66 I’m not able to travel as much as I used to, but can still drive between Pennsylvania and Florida. Not real lean on flying anymore, so international travel is limited to cruises. Life is good.

[@TheFirstRealChewy]

We're currently trading more money in retirement for more traveling now. At the same time, we'd sure love to retire today.😅

[@walkingtofi]

Great video. As always well structured. My wife and I could have retired 5 years ago in our late 40s but decided on that 1 more year. Then the world seemed a bit wobbly so 1 more year, then a 2 year lockdown so more delays. financial shockwaves at the moment, so 1 more year....I think the "Recreational" part of it sounds good and takes all the pressure off us to drop everything and have the occasional "Splurge" with our part time extra cashflow without dipping into savings.

[@jamesspaulding7580]

Great video! FIRE has many good attributes, especially the FI part. Calculate your FI number and work backwards (start with the end in mind), how much do you need to save monthly to achieve FI, then seek out your passion and work recreationally doing something you enjoy. For me it's about balance, enjoy today but not at the expense of tomorrow and vice versa; for me that's saving 20% each month since I was 25; I'm on track to achieve FI at 55, but hoping to become a personal finance coach (my recreational employment)- to help others reach their FI goal

[@moegoggles]

Great message!

[@ErinTalksMoney]

Thanks!

[@RandomJane104]

I allow myself to enjoy 1% of every raise. The rest is invested either in retirement accounts or a brokerage account. Avoiding lifestyle creep is key. Find a comfortable balance and stay there.

[@ErinTalksMoney]

If you avoid lifestyle creep you are golden!!

[@Sondan1988]

"I was convinced at 20 I had it all figured out." ---- Don't all 20 year olds think they have the world all figured out ???? Thank you Erin...that just cracked me up.

[@scottg2946]

MMM is also the one that got me hooked! I first read an article about him in the New Yorker in 2015; he's got great content and a great attitude, and he also emphasizes the "FI" much more than the "RE."

[@ErinTalksMoney]

Absolutely - he has a great perspective! MMM will always be the OG

[@cybercab]

I started investing when I was 15 but was 24 before I started to take it seriously. I retired at 40 and was able to pursue various adventurous ventures since. The boring index fund continue to work, year after year. It really is that simple. The thing most people don't fully grasp while doing the FIRE thing is that leaving a standard corporate environment is sometimes disconcerting. If you can do anything--will you want to do nothing? I think we need some guidelines to feel comfortable. They trick is to establish structures and systems to ensure you're safely doing the thing that you need to be doing. I tend to either want to work zero hours or 18 hours a day. Both extremes are ultimately counterproductive. Man, Adulting is tough sometimes!

[@FIRE_DrNinjaTurtle]

I have it fire but I am now going for FAT Fire. Thanks to you and your channel for keeping me focused

[@natelammers652]

I’m chasing FIRE. Currently 38 shooting for 50. I might work another 5 years after I hit FI, but it won’t be the ridiculous hours, most of the year job. I think a 4 month gig in early spring with 8 months off is my goal. Currently work all summer with no real time off to enjoy summer on the Great Lakes.

[@ErinTalksMoney]

Great goal, and good luck! You can't beat a Great Lakes summer - I hope you can make some time to enjoy this coming one!

[@dahubbzgaming]

Right now im chasing the financial independence and depending on how my current job goes will determine the rest.

[@suzannehall5200]

I am a big believer in enjoying life now because you may not have a life when retirement comes around or you may not make it that far. I retired this year and whilst I’m in a good financial position everything else in my life is falling down around me. I’m spending all of my time caring for a very cantankerous, frail and increasingly delusional parent and it’s not going to get better. It’s only going to get worse. So enjoy yourself NOW.

[@roburb73]

My wife will retire early, me - not so much! :) I will more than likely stop at 55-58, the latter being when our son graduates HS. My wife is 10 years younger than I am, so that will be 45-48 for her :) We could stop now, but what would we do with our son in school, etc!

[@ErinTalksMoney]

I get that! When I met Steve I was still aiming for an early 30s retirement - but he's not retiring from the service until 40. What fun would that be to retire and have him still working?!?!? We will aim to retire together, so we can adventure together.

[@daverose2279]

i like your fire definition, i have been thinking of 55 as the retirement age but now that the age in close i like the recreationally employed since i dont know what i really want to do with my time.

[@ErinTalksMoney]

Both my parents ran into that - hence why even in their 70s they have found ways to do work they enjoy!

[@daverose2279]

Mine also. They "retired" several times. To me it feels like knowing I can walk out at anytime in the freedom of retirement. And keeps my boss in check :-)

[@kentcolgan6139]

Good video. My only nit is when choosing between Roth and and a non tax advantaged brokerage account it seems to me the Roth would be the way to go. For both options you’re investing post tax money. In the case of the Roth you don’t pay tax on the earnings.

[@martypoll]

I retired at 55 years old which I am going to say is a FIRE age. From the chart I am in the 13% category well ahead of the 60-65 cohort. While I did save money (some of which I lost in 2008-2009) I was really able to retire early because I worked 30 years as an engineer for the University of California which has a generous defined benefit retirement program. I do tell others though that financial independence is the real goal. In my case I have what everyone would recognize as a traditional retirement. I've been retired for 12 years with no paid work but with some substantial volunteer work in the early years. I did have a job that I loved but year 30 was a downer and I decided that enough was enough. Typical for an American, I had accrued 9.5 months of vacation time and 9 months of sick leave at the time I retired.

[@curtiswfranks]

I need to decide when I want to retire and whether it is a full retirement or a partial one (with recreational employment). I am not quite there, but I am starting to get to the point where I can coast on my tax-advantaged retirement accounts if I really want to. Retirement would not be splendid with just them if I were to stop investing in them in, say, two years, but it would be functional. So, once I cross that threshold, I need to decide whether I want to continue shoveling money into them and retire at the conventional age but live what would be, for me, very well. Alternatively, I could divert some or all of that future income into other brokerage accounts which are not tax-advantaged and which will have less time to grow, but which would be accessible to me at a much younger age. Or split the difference and retire at a moderate age. If I continue to work after retirement, then that changes things too. And family structure will matter. Lots of variables. Right now, I am just dutifully saving into the tax-advantaged accounts and putting the remainder into the normal brokerage accounts because the tax benefits are hard to pass up, I have not yet crossed the aforementioned threshold, and I want to at least secure a retirement for my older age. It is working for now. But I do seriously fear being retirement rich and currently poor, locking myself into working for decades just to get to the point where I can access the money which I had the whole time.

[@michaelswami]

Thank you Erin. I submit that taxable brokerage accounts are tax advantaged, especially against pretax investments. Brokerage accounts allow you to take advantage of long term capital gains and tax advantaged qualified dividends. Pretax accounts turn long term capital gains and dividends into ordinary income.

[@ramenandgyoza702]

Thats what i want and aim to be. Financially Independent, Recreational Employment as i want my brain to be still stimulated, challenged and constantly learning while not having to worry about bills and debt. 🙂

[@CelticsWin7]

My long term financial goal on fire is to retire by 50. Let's gooo!!

[@MrPizzaman09]

At about 27 or 28, I started thinking I could retire particularly early if I played my cards right and swung for the fences on the investing front. If I miss, oh well, but if I get it right, I might only have to work into my 40's.

[@fredswartley9778]

I don't want to retire early, but I would like to be more financially independent. I would like to keep working after I'm retired from my primary work, just in a different kind of job.

[@ErinTalksMoney]

I feel the same way - plus I think it's fun to have experiences in different fields, you get to explore different passions that way. 😊

[@MrJoel12mi]

Hi Erin, I worked contract work most of my adult years. they we either bad companies that I did not trust or companies that didnt offer any kind of a match. So i justified not adding to my 401k for many years. I am 60 years old and finally have a good paying job ( well to me it is good pay) they match 401k 4.5% . I am saving pretty aggressively maxing out my contributions each year and maxing out my HSA. I have no debts. Any tips for me to help get me to where I need to be for retirement? Thanks

[@jennyogg4591]

Capital gains tax instead of income tax makes brokerage accounts tax advantaged, just not in the same way as an IRA.

[@ErinTalksMoney]

Great point!

[@Kastoraki]

I want to retire NOW, not to stand up in the morning, just turn off the alarm clock and return to sleep....

[@southbound1969]

457b's balances are available when you sever employment without penalty at any age.

[@leehaskins307]

I dont thing the average person can retire early at like 40.. most all people work until there 60’s…. I think working is more improtant mind and health wise…. I’m 60, retiring in a year from now.. would never have wanted to retire at 40… I love my contribution to my career.. its part of me..

[@e22ddie46]

I'm currently trying to hit fire by 45 or 52 if I have kids. I'm currently 31.

[@KrustyKlown]

In my 20's, I was constantly in debt, barely enough money to live on. Investing then, would be like Borrowing money to invest .. .when should one do that??.. probably depends on interest rates.. when I was young the rates were double digits, thus paying down debt was more important than investing.

[@vulpixelful]

I would still invest a minimum while in debt. Even with interest rates being high. Mainly because in investing as early as you can you stand to gain way more than you lose in interest if you take a few months longer to pay off the debt.

[@morebeer7673]

Yep, I think a lot of us watching these videos now were in the same boat as you in our 20's, - high debt and low income - so the thought of saving and investing at that age seemed laughable. I taught myself about investing and personal finance while working retail in my mid-late 20's for barely more than minimum wage. I started my own IRA from what I taught myself, but had very little to invest in it. I didn't have access to any kind of 401k or company matching until I was in my late 30's after I went back to school and earned a degree in Finance, so true consistent investing didn't actually start for me until that point. Now I have employees that are joining our firm in their mid 20's and I'm quick to steer them towards taking advantage of the 401k and investing at their young age. I'm hitting it hard now in my 50's to make up for lost time, but I'm pretty sure I'll never be a millionaire.

[@bradleyvanzile1111]

I retired at 37 on SSDI own my house and car

[@rabidfollower]

If you retire before age 61 years and 364 days, you retire early, that's my thinking. But FIRE is often associated with retiring much earlier. Not impossible, of course, if you START earlier. So we need a new term: FIRE & ISE (pronounced "fire and ice") - financial independence and retire early, if you start early. If a teenager starts saving long-term with financial acumen and discipline, then he or she can definitely retire at a nauseatingly early age. I myself started investing at 25 but only "hit my stride" in my 30s, so I fit the statistics. I retired at age 52 in 2019 with $1m, after about 25 years of saving and investing. The 2000s was a bad decade for investing, so I basically had only ONE good decade, 2010-2019, to work on. All of you young ones had better pray there will be a great, gang-busting decade in your (near) future. You may only get one like I did, 2-3 if you're lucky (many boomers had two, 1980s and 90s), none if you're not.

[@Azel247]

Because of my income and our savings, my wife achieved FIRE at 37. Unfortunately that means I have to keep working until 55.

[@southbound1969]

One day you will be out of "some days"

[@paulbrown5937]

FI is so much more important than RE!

[@TonyKimCre]

Plan financial independence

[@HenryLaw19891024]

Inheritance tax and capital gains tax are our worst enemies. I disagree but sometimes understand why people don't wanna save 😪

[@JohnPMiller]

In 2023, the U.S. federal estate tax is only for assets over $12.92M. If you're careful, and you don't live in a state with inheritance tax, you should be OK. If you want to minimize your capital gains tax, always keep your investments for at least one year (long-term capital gains tax). For me, the real downside of any possible inheritance tax is that I'll be dead.😉

[@ErinTalksMoney]

An estate attorney can help you greatly mitigate inheritance taxes.

[@trackguy4038]

For side jobs, why not talk more about reffing sports? With federal and state employees often work 7 - 3, so can get off work nd ref sports.

[@josephstevens9888]

I meet another man, my default question to them always is, "what do you do for a living". I guess that comes from men always identifying with what they do as an occupation.

[@martypoll]

I am not at all shy about telling people I am retired though admitting that you are retired is difficult for some.

[@TheFourthWinchester]

People are banking on stock market for retirement. Where will the growth come from in a world where even India and China are having lesser babies than ever before? Stock market depends on endless consumption.

[@over07ful]

MAKE CONGRESS YOUR TAX ADVISOR AND DO WHAT THEY PROMOTE!!!!!!!!! MAXIMISE YOUR ROTH IRA!!!!!!!!!!!!

[@highbrass3749]

Just don’t make them your accountants. 😂

[@nazeercurry5248]

🥇🥇🥇

[@lukehanson5320]

E.n.g.a.g.e.m.e.n.t.

[@kurtneven6612]

Good job lady 👍