The unpleasant truth about FIRE

The unpleasant truth about FIRE
I’ve always spoken frankly and honestly to you even if the truth I speak is controversial, and sometimes upsetting. Let’s talk about FIRE. What I’m going to say is going to be hurtful to a lot of you. A lot of us do not like our jobs; in fact, we hate our jobs. The idea that you are unlikely to ever retire early is going to be frustrating.
FIRE is rich people living like poor people as a hobby. FIRE is a movement where high earners save a lot of money to retire earlier than they otherwise would have. If you are having trouble making the numbers work for you, it’s probably because FIRE is not realistic but don’t feel bad. FIRE just is not realistic for most people in most situations.
A lot of FIRE people are technology or engineering professionals that make $200k to $300k a year and retire to have a lifestyle similar to a teacher.
At the end of the day, it all comes down to your expenses. It is less about how much money you have accumulated and more about your monthly living costs. This is why so many FIRE people retire and have very modest living standards and expenses. In fact, you would be surprised how many of these people return to working.
There is an insinuation that FIRE is enabled by hard work, determination, and self-discipline. Proponents of FIRE like to consider themselves humble, hard workers, working class people. While I’m sure most of them are hard working people that are good with their money, FIRE is far more enabled through high incomes than being principled.
Studies have shown that both low income and high-income people like to consider themselves as middle income. The reality is that a median household income in the United States is about $60,000. Under these circumstances, FIRE is all but impossible. A household making $200,000 will likely consider themselves middle income, as well as working class. It will be several times easier for a high-income household to retire early in contrast to a middle income household.
The middle class has been shrinking for some time now. While America has become richer, the average American has become poorer, especially lately after you factor in inflation. There was a time that working in a factory could support an entire household, put two cars in the driveway, and pay for a nice vacation.
So, I propose we redefine FIRE as “live below your means, plans and save for the future.” You are going to need to have a decent middle-class job or dual income household to have a realistic shot at FIRE. If your household can contribute $1,000 a month to a company 401k that matches up to 6%, that is $2k per a month in retirement accounts. That should put you on a trajectory to have about $1 million in 20 years. Even that may not be enough to fire comfortably as the future is uncertain, but let’s consider this the goal for a shot at FIRE. Put away between $1,000 to $2,000, and plan for FIRE to take about 20 years.
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