Is financial independence and retiring early really possible for most people?


Personal finance bloggers and writers have been getting all “fired up” in recent months about the FIRE acronym, which stands for Financial Independence Retire Early. We wrote about the similar concept of Work Optional earlier this year, here.

Typically, FIRE enthusiasts aim to save like mad for a decade or two, squirrelling away as much as 50% of their after-tax income. Then, the theory goes, they are free to “retire” in their 30s or 40s, with 50 years or more of infinite leisure: the mythical “permanent vacation.”

If you sense a skeptical tone in my recap, you may appreciate the stance a number of Canadian personal finance bloggers are taking. And there seems to be a bit of a divide between American personal finance bloggers selling the dream of FIRE, and their Canadian counterparts.

Like me, Canadian bloggers Robb Engen (BoomerandEcho), Mark Seed (MyOwnAdvisor) and Michael J. Wiener (aka Michael James on Money) argue that no one really “retires” in their 30s: more likely than not, what these young FIRE proponents are really talking about is leaving the corporate rat race in order to launch their own entrepreneurial careers.

Typically, this consists of launching a FIRE blog that accepts advertising, and publishing or self-publishing books meant to generate revenue, and/or launching a speaking career with paid gigs that tell everyone else how they “retired” so early in life. Some of us don’t consider such a lifestyle to be truly retired in the classic sense of the word: in other words, we’re all in favour of the “FI” part of the acronym: financial independence. We’re just not so enthusiastic about the “RE” part: retire early.

Almost a year ago, Michel Wiener sensibly posed the question “Is FIRE impossible for reasonable people?” Robb Engen wrote this blog arguing a more honest term might be FIE, for Financially Independent Entrepreneur. And Mark Seed suggests FIWOOT, which stands for Financially Independent Working On Own Terms. (My memory aid for that one is “Getting off on the right FIWOOT.”)

I, myself, for obvious reasons, prefer the term “Findependence,” a contraction of “financial independence” (I wrote a book on the topic called Findependence Day.) Note that even at age 66, I still don’t consider myself “retired,” although I certainly have reached Findependence. As I’ve said before, you can be Findependent but not Retired, but it’s pretty hard to be retired if you’re not Findependent.

While one Twitter conversation among the Canadian FIRE bloggers suggested their American counterparts are a bit more aggressive in selling the FIRE dream even as they profit from it without being really retired (in the classic sense), at least one prominent US. blogger has written he sees some hypocrisy in the FIRE stance of many such bloggers; see Retirement Manifesto’s post “Is the FIRE community full of hypocrites?” The blog is run by Fritz Gilbert, who recently retired at 55—which just happens to be the magic retirement age popularized in the “Freedom 55” advertisements. I have gotten to know Fritz through our mutual participation in the Younger Next Year 2020 Facebook group (which I moderate).

Gilbert writes that “for the record, I’m a fan of FIRE.” That said, he passes along several cogent observations from reader Phil, who also retired at 55, albeit four years ago—early by most of our standards, but relatively late for a hard-core FIRE enthusiast. Phil did take on the FIRE bloggers, however, suggesting readers should be skeptical about FIRE bloggers who are attempting to monetize their FIRE evangelism. The latter tend to promote the idea that less work equates to more happiness, something that may not be true (as Mike Drak and I have argued in our co-authored book, Victory Lap Retirement).

Also, while posting online about FIRE may become a late-in-life career for those so inclined, not everyone aspires to be a lifestyle influencer or semi-professional blogger. And while few dispute that financial independence is a fine goal in its own right, Gilbert argues that few FIRE proponents fully live up to the “Retire” part of retiring early, even if they saved 50% of their income in order to establish Financial Independence early in life. Phil cites this as his pet peeve about FIRE, although Gilbert argues a key precept of FIRE is the elimination of mandatory work.

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