Achieve your Financial Independence and Early Retire (The F.I.R.E movement).

As generations come and go, it becomes clearer that newer generations want more out of their life and career. Baby boomers could work in a single company for their whole life. Since then, more and more people imagine their life like that. In recent years, a new movement has emerged out of this trend. The F.I.R.E. movement, which stands for Financial Independence Retire Early, came out of this need.

Although these ideas were discussed for centuries, the modern version that I’m referring to started in 1992, with the book “Your Money or Your Life” by Joe Dominguez and Vicki Robin. In there, the authors gave nine steps with which one can change his or her financial life. Step included like eliminate debt or change one's habits on spending and saving. Next, in the late 2000s, the book “Early Retirement Extreme” came to be and added the RE part of the FIRE movement. But where it really took off was when Peter Adeney started his blog “”, or MMM for short. This is where the term “Mustacianism” was created.

The FIRE movement contains elements of personal finance, investing, frugalism, minimalism, entrepreneurship, stoicism, and more. There are countless versions of what financial independence and early retirement mean to everybody and thus there is countless differentiation of the same thing.

Types of F.I.R.E

Living below one’s means, frugalism, and more than a 70% saving rate, this type of FIRE requires much more discipline than its counterparties. LeanFIRE requires spending as little as possible in order to gather a saving amount that, in combination with investing and compound interest, will lead one to retire with less.

The followers of Fat FIRE are willing to either retire a little earlier than their Lean FIRE counterparties, or they are more privileged by having greater income and/or fewer expenses. The followers of fatFIRE usually practice minimalism, which I will describe further below.

This type of FIRE is for those who want to take things to the extreme. This type of FIRE comes hand in hand with terms like anti-consumerism, DIY, the Renaissance man ideal, home economics, individualism, environmentalism, and rentier capitalism.

Various Components of Mustacianism

Pete Adeney defined FIRE as:

This word describes a person who wishes to reach financial freedom in order to pursue his own aspirations without having to depend on active work to live.

His blog created a new wave of people interested in following this manifesto. These people will be called “mustacians”, and their philosophy “mustacianism”.

People tend to use these words interchangeably, although they do not refer to the same thing.

Merriam Webster defines frugality as

The quality or state of being frugal. Careful management of material resources and especially money.

Frugals tend to restrain themselves when it comes to the acquisition of goods and/or services, use resources that they already owned, and of course to minimize their waste to zero, if possible. A frugal usually won’t buy expensive material goods, and usually does not restrain himself or herself to the number of material possessions.

Minimalists on the other side care about the number of their material possessions, and although they are also mindful when it comes to their waste, they won't hesitate to enjoy luxury material goods.

Of course, these terms are not carved on stone, and they do not refer only to the material positions, but resources in general, such as time, energy, etc. There are many intersections between though and each one will create his or her own version of the above terms. My personal distinction is that a follower of frugality, usually, won't buy luxury items, but a minimalist could.

The author of the “Get Rich Slowly” blog has written the following examples to define the difference between frugality and minimalism:


I bought my clothes at the thrift store. I spent less, but I bought more clothes. I bought books at the annual library sale. For the price of one new book, I could bring home ten used books!


I have a friend who is a minimalist. He consciously works to own little and to do little. He focuses on essentials. He has maybe five shirts and a couple pairs of pants. He owns one jacket. For a computer, he deliberately chose the current MacBook because it has clean lines and minimal ports. He doesn’t buy books, instead preferring to purchase them on his Kindle or borrow them from the library.

Of course, FIRE has heavily to do with investing. Investing is the vehicle to achieve the FI part of the equation. Personal finance would help them to manage their money and to effectively put them to work for them.

Another aspect that the FIRE community has income is usually entrepreneurship. Self-employed people can manage their life in more detail and usually use entrepreneurship to add to their investment. Full time or a side hustle, FIRE community members are most likely to be interested in.

Let’s not fool ourselves, in order to change anything to our lives and take control of it, we require steady and healthy thinking. Stoicism, a philosophical movement that started in ancient Greece and Rome, is helping FIRE members control their mood and thinking. We cannot think about investing if we spend our money uncontrollably, nor we could start a side gig, nor we could think about early retirement.

Numbers and Calculations

The basics of this section are covered in the “Personal finance and money management” article on my blog. Today I will extend on that and I’ll add some FIRE metrics for you to track.

With net worth, we measure what we own and what we owe. This metric is the most important one. After we calculate our FIRE target, we need to work on this metric and bring it closer to the number defined by us.

Here we could improve include every asset at its immediate resell value. It's up to you how picky you would like to be. One can include every book or smaller item he or she has, and one can include just investments and his or her valuable things.

Of course, we don't want to put all of our eggs into one basket. the allocation metric can help us define where we need to reallocate resources in order to minimize our risk. If for example, you own just one stock, you could lose all of your invested money if this company files for bankruptcy. It's always a good idea to put our resources into different assets.

When you predefine how much you plan to spend each month you will be able to forecast your future situation.

The equation that will give you your saving rate is

This metric will show you the rate at which you could achieve your FIRE goal.

The “When can I Retire Calculator”

This handy little calculator can show you much of the above information. You simply spend some time tracking your spending behavior and then you fill out the fields given below.

The image has been taken from


You must be aware of the risks and be willing to accept them in order to invest in these markets. Don’t trade with money you can’t afford to lose. The information contained in this article is for educational purposes only and is not to be a recommendation for any specific investment. Trading any market carries a high level of risk, and may not be suitable for all investors.

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