Define your own FIRE

I’ve been reading about the FIRE movement more and more of the past 6 months. It’s almost been impossible to miss in the mainstream press. Here in Australia, our largest publications have well and truely jumped on the bandwagon (SMH, News, Business Insider).

The majority of the uninitiated approach the concept with more than a healthy degree of caution, and rightfully so, we’ve always been told that anything too good to be true probably is.

Past generations have marched steadily to the beat of the same drum, acquire some education, get a reliable job & work for about 40 years. Then, if your mind, body and finances are up to it, go and enjoy yourself. This is steadily changing and it’s clear that those born after the early 1980’s have started to develop a more progressive line of thinking.

It’s no secret that millennials are increasingly valuing experiences over possessions. A 2015 study by events-tech company Eventbrite found:

…this generation not only highly values experiences, but they are increasingly spending time and money on them: from concerts and social events to athletic pursuits, to cultural experiences and events of all kinds. For this group, happiness isn’t as focused on possessions or career status. Living a meaningful, happy life is about creating, sharing and capturing memories earned through experiences that span the spectrum of life’s opportunities.

Spending on live experiences has been on a steady rise since 1987, in the US the relevant share of spend on live events compared to other consumer spending increased 70%. Those figures are staggering, an outsized performance of 70% over such a long period is virtually unheard of.

We see a microcosm of this behaviour ever weekend at the local cafe. 20-somethings spending $50 on their weekly smashed-avo breakfast. I’m just as guilty as the next, rarely do I go a day without two servings of a large Cappuccino from a local Sydney cafe.

My parents rarely ate out unless it was a special occasion or someone else was picking up the bill. I could count on the one hand the days that my father didn’t take a packed lunch to work. Meanwhile, my mid-twenties colleagues look at me oddly every time I bring in some delicious leftovers. There is a fine line between funding enjoyment and frivolous spending, but it’s difficult to deny there has been a fundamental shift in the acceptable spending habits between generations.

So where does consumer spending and millennial behaviour have to do with the FIRE concept? In my opinion, not a lot. But perhaps it should.

My major criticism of the FIRE movement is that so many peoples plans are heavily based on both present and future frugality. Perhaps its not my place to judge, but I feel that retiring early to live on rice and beans is not really what I had envisioned for my future. There is nothing wrong with minimising wastage but a living like a pauper just to declare FIRE feels like a life partially lived.

I spent some time thinking what is it that I want from my financial future and I realised that I’m quite greedy. I still see the value in the security that past generations have focused on, but don’t want to miss out on the experience that make life worth living.

Eventually, I decided that I want to pursue a FIRE lifestyle, but slightly adapt its meaning to apply to my own set of circumstances. So I’ve defined my own financial journey as:

Financial Independence delivering Relaxation & Enjoyment

Ultimately, I enjoy working, I don’t really know what I would do with those 40, 50 or 60 hours each week if I was to retire. The mental stimulation, problem solving and sense of purpose that comes with work would be sorely missed. I sympathise with those that hate their job, career or manager. There are so many that bemoan their employment situation but simultaneously feel trapped by their ongoing dependance on their monthly pay check. Surely Financial Independence can play a role in liberating us.

There’s a clear opportunity for Financial Independence to provide the freedom for people to pursue employment that provides a greater level of freedom, enjoyment and purpose.

What’s your definition of FIRE? Are you looking to completely retire, increase your flexibly or just increase your financial security?