If you are early in your financial journey, you may have questions and concerns about the whole “FIRE” concept (Financial Independence / Retire Early). Should you dive in and work your tail off to retire early, or should you take your time and retire when most people do, in their 60s or later?
You may be asking “Is it really worth it to FIRE?” It seems like a lot of work, but it also sounds like an amazing life. (Spoiler: it is a wonderful life, but we’ll get to that in a minute.)
My wife, Allison, and I achieved FIRE four years ago in our early 40s, so I have direct experience with the pros and cons of FIRE.
I will start by saying that not everyone should retire early. If you absolutely love your job and feel completely fulfilled, then by all means, you should keep going! Look at someone like Ruth Bader Ginsburg; even at the age of 85, RBG loves what she does, and she is very good at it. RBG is on record that she doesn’t plan to retire until she is 90.
Arguments Against FIRE
So, what could possibly be an argument against becoming financially independent and retiring early? Well, I have seven pretty strong reasons not to achieve FIRE...
1. It’s hard
It requires a lot of financial knowledge, dedication, and patience. Achieving FIRE is not going to just happen on its own. You have to really want it. That means making some sacrifices, like working longer hours when you are in your 20s and 30s. It means learning about personal finances, and applying what you learn to your own situation.
It also means getting your spouse, significant other, and/or other family members on board. They will need to understand they are in your FIRE journey as well, like forgoing those expensive new tech gadgets and socking away a little extra in savings.
2. It’s risky
It will be very difficult to FIRE if your investment strategy is simply putting money in a checking or savings account (or under your mattress). You are going to have to put your earnings into inherently riskier entities like the stock market.
It all comes down to risk and reward. For the most part, the riskier your investment, the more potential upside for making more money. However, you also need to be able to evaluate the risk and try to make intelligent risks. So, for example, you need to have enough self-control to not jump into the latest fad (I see you, cryptocurrency) or put all your eggs in one basket.
3. It’s not the norm
Most people will not understand why you retired early and are no longer working a “real job.” The FIRE concept is still relatively new, and many people are not familiar with it.
You may have to spend a little time explaining what FIRE is to your parents, friends, and loved ones. You’ll get all kinds of reactions -- some will be thrilled for you, others will be concerned about your financial situation, and a few might think you’re just being lazy.
At the end of the day, it doesn’t really matter what other people think. If you chose to FIRE, you’ll need to to embrace living an unconventional lifestyle that most people may not fully understand.
4. You might get bored
You won’t have a regular routine anymore. When you’re working a regular full-time job, you have a built-in schedule to your day and week. Even if you don’t love your job, it can be nice to have that structure.
When you FIRE, you have to create your own daily routines. While this freedom can be exhilarating at first, it can quickly spiral downwards if you’re not careful. You may not only get bored, but you might start feeling depressed or anxious.
You have to make a concerted effort to design a daily and weekly routine that will keep you happy, healthy, and engaged.
5. You may lose social connections
In addition to providing a regular daily schedule, a full-time job provides you with a built-in social network. You may or may not be best friends with your co-workers, but just having them around each day provides you with plenty of human contact.
Once you FIRE, you have to create your own social networks (and I’m not talking about Facebook). It’s important to make an effort to meet with friends, family, and neighbors in person on a regular basis.
6. You may lose your identity
Most people’s identity revolves around their job or career. When you meet someone for the first time, typically the conversation starts with the question “What do you do for a living?” And you respond with “I’m a teacher, an engineer, a doctor, etc.”
When you FIRE, you’ll have to create a new identity that’s unrelated to what you did for a living. This can be tricky, and there’s no right or wrong solution. Your new identity will revolve around things like your passions, hobbies, skills. Your new identity could be something like “I’m a world traveler, gourmet cook, or neighborhood volunteer.”
7. You won’t have a steady income
You won’t have the safety net of a regular paycheck when you retire from the workplace. For many people, this can be the biggest mental hurdle to overcome.
Even if you’ve done all the math and your nest egg is more than 30X your yearly expenses, it can feel a little disconcerting not to have regular income coming in.
One way to alleviate this situation is to find other ways to earn money after you FIRE. You may be able to create alternate income streams, such as dividends and interest from your investments, working on a side hustle, buying a rental property, etc. We offer a variety of ideas on our Increasing Your Income resource page.
Reasons We FIRE’d
You may be ready to run for the hills after reading that list of reasons not to FIRE. Fortunately, there are also some very compelling arguments in favor of FIRE.
Before you decide what’s best for you, take a look at some of the reasons we FIRE’d:
My overall favorite perk about FIRE is the utter and complete freedom it provides. When you are working a full-time job for other people, you are ultimately beholden to them -- your time, energy, and focus go into your job and you do what other people want.
When you FIRE, you now have the ability to do what you want, when you want, and how you want. Having this kind of freedom allows you to take advantage of the rest of the wonderful items on this list.
2. Better health
After you FIRE, you have all the time in the world to work out and get (or stay) in shape. Allison and I are much more physically active now than when we were working. Sure, we used to go to yoga classes 2-3 times per week and walk or bike to work, but it was always a struggle to find time to work *and* work out.
But now we do something physical each and everyday. We’re in the gym doing strength training 3x per week, I swim 3x per week, and we walk everyday. Our goal is to be as healthy as possible so we can travel and enjoy our early retirement to the fullest.
We also spend more time eating mindfully, making sure we eat enough fruits, vegetables, nuts, and healthy fats throughout the day. (Not that we’re immune from splurging and enjoying a good burger, fries, and pizza from time to time!) We try to maintain a healthy lifestyle so that we can do the things that we want to do (which leads us to...)
This is my second favorite advantage of FIRE. You now have the time to travel the world.
When Allison and I were working full-time, it was difficult for both of us to schedule enough time off (at the same time) to go on trips for more than a week. So we rarely traveled internationally.
Just in the four years since we’ve FIRE’d, we’ve been to over a dozen countries in Europe, Asia, and Central & South America. These trips have ranged from just a couple weeks to up to 5 weeks when we visited SE Asia.
We have also done plenty of domestic trips like our recent 6-week trip going to both of our 30-year high school reunions, Disney World, and FinCon. And we’re currently planning a 6-week tour of Australia, New Zealand, and Indonesia!
Autonomy is closely related to “freedom,” although I consider autonomy to be more related to your job. When you’re working, you have a boss that you have to answer to. Even if you’re the CEO, you have a Board of Directors, shareholders, etc.
After you FIRE, you are your own boss. No more people telling you what to do. If you’ve ever had a boss you didn’t like, trust, or respect, then you will love finally having full autonomy.
For me, I love having full control and ownership of my website Retire By 45. I can write about whatever I want, create the look and feel I like, and spend as much or as little time on it as I desire.
5. More time for relationships
Most people would agree that spending time with their family, friends, and loved ones is very important. But how often do you neglect this, because you’re too busy working?
When you FIRE, you now have time to cultivate all those important relationships. You can go on more date nights with your spouse, you can get outside and play ball with your kids, and you can meet up with your friends for dinner more often.
When you’re on your deathbed, you’re NOT going to regret that you didn’t spend more time working at the office. But you WILL regret all the time you didn’t spend with your loved ones.
6. Passion projects
FIRE means that you can work on whatever projects are important to you. You know the ones -- the creative and exciting activities that really get your juices flowing.
Have you always wanted to play guitar, learn to scuba dive, or write a novel? Now you have time to do it.
Perhaps you want to volunteer more in your community, or become a gourmet chef, or start a side business. When you FIRE, it doesn’t mean you sit around in a hammock all day. On the contrary, you end up doing so many things that you would’ve never gotten around to otherwise.
7. Less stress
When you FIRE, you no longer have to deal with rush hour traffic, unrealistic deadlines, and office politics. You can go to sleep when you want, wake up when you want, and get as much sleep as your body needs.
You can keep your stress down by meditating more, spending time in nature, and taking a more leisurely approach to life. No more rushing around like a madman everyday.
Are there still things to stress about? Sure, we’re all human, and life can be stressful. But when you FIRE, life just has a way of slowing down a bit so you can “stop and smell the roses” a lot more often.
Occasionally, people will ask us if we ever plan on going back to work. Our answer is typically a resounding “No thanks!” After four years, we’ve developed our daily and weekly routines, and we’ve found ways to keep our lives interesting, exciting, and challenging.
If we ever feel that we need more money, we can always move to less expensive location, create rental income, or find other passive income streams. It’s just a matter of being creative and disciplined (the same strategies used to get to FIRE in the first place).
Is FIRE for everyone? Of course not. But for us, the pros far outweigh the cons!