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FIRE Lifestyle

Lately, the economic principles of FIRE have been covered by many significant media like Forbes and others. Blogs of the most well-known representatives of the movement have hundreds of thousands of subscribers. As a result, the FIRE lifestyle has become a part of a fashion trend, along with downshifting and nature protection. But FIRE is not a strategy to fight against consumer society.

Indeed, people who have achieved financial independence tend to minimize the use of any resources. Many of their solutions look original and attractive. Giving up a car in favor of a bicycle or hiking, living in the countryside, repairing things with one’s own hands — all this seems exotic in everyday life.

However, such a lifestyle is a result of a smart economic strategy. It is based on economics, not ideology. On the way to financial independence, decisions should be made extremely rationally. Practice shows that namely economic feasibility determines the questions raised by people who intend to achieve FIRE.

Additional income or savings?

The main question of a potential investor is where to get funds to invest in the future. Experts recommend to invest at least 10–15% of monthly income, but not everyone can afford it. Young people often pay for educational loans, housing rent, or mortgages. Therefore, there is a choice between searching for additional income or saving strictly. Well-known coaching advisors promise up to 50% to the basic income by freelancing or the same 50% of savings on everyday expenses. How realistic is it?

The recommendation to earn more is good for unique professionals who can plan their work schedules by themselves. A typical manager is limited by cooperation with other employees and standard office hours. Besides, free time is necessary to study investment tools. Savings on consumption produce results, but the consequences are associated with risks. For example, savings on high-quality food can lead to illness and loss of income. As a result, real losses may outweigh the potential benefit.

The best option is to improve the lifestyle instead of changing it. Many daily activities can be monetized with minimal efforts. As a simple example, one of the first steps towards financial independence is strict cost accounting. This can be done using one of the convenient and free websites, such as or They are free because marketers and sociologists willingly pay for anonymized data about purchases. It is possible to do the opposite — take part in one of the studies independently and transfer information about the costs directly to marketers. It is not so convenient, however, it will be possible to earn money for the work that is currently done for free.

Initial capital — how much?

The main goal of FIRE is to create passive capital that brings stable income. Therefore, it is not enough to simply earn or save money, the money should be invested. What amount is needed to start? Some experts recommend to create a financial “safety net” in the amount of 3–6 months income, others suggest to invest nearly every dollar. Now it is possible to diversify the investment portfolio to the fullest extent by investing small amounts in various assets. For example, the minimum investment on is 10 euros, which is convenient to get to know the platform.

For professional work with investments, the main criterion should be the ratio of the time spent, rather than the amount. In theory, passive capital does not require constant monitoring, but anyway it is necessary to analyze market regularly, diversify portfolio and report on taxes. Income from investments should at least compensate for the time spent.To compare with, it is possible to use the amount paid per hour or day at the main job. An important factor may be a tax agent. In most countries, when selling stocks and bonds at a price higher than the purchase, it is required to specify the income in the tax return, whereas an active investor can make hundreds of such transactions over the year.

Leisure on the way to financial independence

When a goal has been set, there is a temptation to reach it in the shortest possible way. For FIRE, this means full concentration on increasing income and investments. Any rest is mainly associated with the entertainment industry, which takes away a significant share from the budget of an average family. Nevertheless, it is a big mistake to completely refuse having a rest. It is not just because it is necessary physically to relax after work. FIRE is not a job, it’s a lifestyle. Life without leisure would be incomplete.

There are a lot of ways to have a rest and travel around the globe without significant expenditures. Certainly, there is no universal recipe, and a lot depends on the region and temperament. Due to the difference in the standard of living, an interesting trip to the countries of Southeast Asia will cost less than standard housing rent in the EU or the United States for the same period. Medical tourism is also popular. For example, the difference in the cost of services of a qualified dentist can fully pay for a three-day trip to Eastern Europe. Finally, a well-organized weekend at the campsite is as enjoyable as an expensive amusement park. It is important to follow one principle — the circumstances during the rest should not cause unplanned expenses.

FIRE Lifestyle is not an ideology, it exists within the economic strategy. What looks exotic and like a challenge to the consumer society is actually the result of a thorough analysis of profitability. FIRE does not mean refusing the high technology or consumer products while their use is still reasonable.

In the next part, we will consider the basic principles of investing funds to achieve FIRE.