Financial Independence Retire Early (FIRE)

Is it even possible to retire early without worrying about financially forever starting from scratch? The answer is an absolute Yes.

25X Rule or 4% rule:
If you are not an outgoing person/family willing to spend more time around your neighborhood and do not want to travel the world and have fun. This is the best way to achieve retiring early. You can save 25 times your annual spending and invest in medium-risk securities. Then you will be able to achieve financial independence when you hit this mark.
This rule applies if you are also planning to do some part-time job based on your interest in the future as a hobby or pass your time.
I don’t think anyone wants to sit idle for the next 40+ years. If that’s you, then this blog is not for you.
My ultimate need for your retiring early is to work with your own schedule and activity. Like being your own boss.
If you are smart enough and have decent skills, you can achieve this point within 10-12 years of your work life. I am in my 6th year of my work-life and I will be achieving this mark around my 10th Year.

  • Disadvantages:
  • If you want to retire in your early 30’s, you will be bored by sitting idle in a year or so. This will make you regret your decision.
  • You cannot plan to buy anything expensive or Luxurious.
  • Inflation can cause serious damage to your savings.
  • The investment made can go wrong making you in a desperate situation at a later point in your life. You can’t make money if got too old and have not worked in the past 10-15 years.

My personal advice is to reach this point and try to switch job which fits your interest and tryout once. Let the 25X savings be a backup for your decision. Try to reach your limits to live your life based on your thought process.

  • Another pointer to think of:
  • If you are going to plan for vacation or a Child’s education or fat wedding, try to keep a separate fund for that spending. Do not try to spend that in your life savings.
  • Before deciding to retire, buy a good health insurance and term insurance policy in case of any accidents/unplanned events occurring. Try to have a fund to pay for the premium.

Ultimately, you might need about 30X of your total saving per year to reach FIRE. 5X is for insurance and other spending funds.

Rights Issued
Retire early

100X Rule:
This is the ultimate point where you can definitely stop working for someone and spend your time in your own interest.

There are three fundamental wealth you can have in your life.

  1. Financial Wealth.
  2. Health and Mental wealth.
  3. Time.

The first two wealth can be somehow be reversed but time can never be bought. I would definitely advise you to stop working for others if you reach 50X-100X of your yearly spending. It does not mean that you need to sit idle, you can spend the time on your ideas and thought process going forward.

After the Millenium mindset, many people in the US are reaching 15X of their savings and start living like a college student. They are cutting their expense by 50-60% making the 15X look like 30X.

I am the kind of person who does not believe in the retirement of stopping to work completely and sit idle. I don’t think I can sit idle in my life. keep pushing yourself and try to do what you want to do is called a retirement to me.

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