6 FIRE Movement Strategies To Follow, Even If You Don’t Plan To Retire Early
Written by
Jordan Rosenfeld
Edited by
Susan Kim
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One of the most aggressive approaches to retirement out there is the FIRE movement, which stands for “financial independence, retire early.” The movement means what it sounds like — people who adopt this strategy seriously set out to retire as early as possible, but typically in their 30s or 40s.
While this is a wild idea for the average worker, especially if you’re well into your 40s or beyond, there are some principles that the movement teaches that any future retiree can learn from — even if you aren’t retiring early.
Consider taking one or more of the following steps to make your own retirement nest egg bigger, and in a short amount of time.
You Can Drastically Cut Expenses
The goal of FIRE is to set aside 50% to 75% of your income — an utterly unrealistic number for the average person unless you’re making an extraordinarily high salary. While most people can’t get anywhere near that, there are some tricks. For example, if you cut your expenses down to the absolute essentials, you might be able to scrape out a lot more than you think to put toward retirement savings.
This might mean going beyond just cutting unwanted subscriptions and not eating out. It might mean downsizing where you live, and not buying any new clothing or leisure items for a period of time. Of course, only you can know what you’re able to cut out, but it might mean a significant boost in your retirement savings.
You Should Prioritize Investing
Simply saving money, even in a high-yield savings account, is just not going to get you to the amount of money the average person needs in retirement, much less for an early retirement. While FIRE suggests putting a ridiculously high percentage of your income into investments, finance expert Dave Ramsey suggests that just putting 15% of your income away is a great approach.
Additionally, if you have an employer match, you should always maximize your contribution to get as much as you can from that avenue.
Do Not Carry a Credit Card Balance
If you have any hope of saving aggressively for retirement, you can’t do it while carrying a credit card balance, which typically has a high interest rate.
If you have an unavoidable debt you’re still paying down, you might be better off taking out a lower interest loan to pay it down. Or, if your credit can handle the effects, utilize a debt consolidation program to get it out from under you. Either way, you need to eliminate credit card debt in order to boost retirement savings.
Seek Additional Income Sources
People who find that their regular income doesn’t leave enough to put toward retirement might want to consider seeking additional income streams through side gigs.
We live in an age of greater side gig availability than ever before. With the power of compound interest on your side, even small amounts of money can grow large by retirement time.
Create a Clear Plan
While FIRE might not be right for you, what those who undertake it have in common is a very clear plan for their future retirement. By having a plan to follow, it’s much easier to stick to goals and achieve them quickly.
Your plan can change, too. Being strategic and intentional is far more likely to result in a robust retirement than just passively getting there.
Make Time for What You Love
The main goal of the FIRE movement is to have the time to do the things you love. You don’t have to retire to do that, though. Anyone, at any time, can prioritize the things that bring meaning, joy and passion to their lives. Working hard is respectable, but don’t forget to pause, rest and enjoy the time you have — because none of it is guaranteed.
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