Why I Don't Support the RE Part of the FIRE Movement
Most everyone knows what FIRE stands for, but just in case you’ve recently gotten into this arena, it stands for Financial Independence Retire Early. So to avoid any confusion, I’m 100% for pursuing Financial Independence, however, some folks take the Retire Early part too literally. Everything in my book and this blog is to help our readers manage their money in ways that provide them with an easier life. Whether it’s getting debt collectors to back off, to move out of bad situations, to finally take that much-needed vacation, or to jump in with both feet and start a business.
Improving one's finances does so much more than allow one to buy things. It buys security, it buys access to good health care, better food, a safer place to live, better mental health, and it gives us back something we can never get more of: time. When we achieve financial stability, we can now move from survival mode to self-actualization mode. We can figure out our passions, spend time with our loved ones, save for future goals like a home, and plan for the future phases of our life. Financial Independence then affords us the opportunity to not rely on trading our time for money or being reliant on a boss or corporation to make sure we still have a roof over our heads. FI should be the ultimate goal for us because now we can channel our energy and skills into passions that make the world a better place and improve our sense of purpose.
Now to the other half of it, Retire Early. I think it’s amazing that some people have been able to retire in their 50s, 40s, and even 30’s. They’ve accumulated enough in their portfolio so that income from their investments or passive income sources, such as rental houses, give them all they need to sustain their lifestyle. They enjoy traveling the world, eating their way through vacations, leisurely participating in hobbies, or spending time with their families. That’s all great!
However, surely you’ve heard of the people who’ve retired, and then become so bored they go back or become depressed because they are isolated. Or the people who work so hard to make retiring early a reality, that once they get there, they go, “now what?”
Yes, having a plan in place like traveling or pursuing hobbies is noble. However, what sense of purpose does it give us to just travel around for the rest of our lives? How useful is it to work out for 2 hours, take a 2-hour stroll, play with your dog/kids, go to a coffee shop, and take naps? Is that really what you want to do for the rest of your life?
One of the biggest issues I have about retiring early is that we need workforce participation. While I know we are currently in a strange economy that’s opened back up after a long lockdown, and people are thirsty to travel, shop, etc, you can see that the labor market is very tight. Many restaurants, hotels, and construction companies are having trouble finding reliable labor. What’s going to happen if more people are gunning for early retirement? Who is going to stock the shelves at the grocery store, fix broken water pipes, build our homes, or repair our cars? We already have a tight labor market now, and while that changes, there is clearly a need for skilled labor and professional services.
Even if one doesn’t want to go back to full-time work, part-time work is possible. Or perhaps now you can do consulting, serve on a board or committee, volunteer with a favorite charity group, or start a juice bar that you’ve been dreaming about for decades. We all have something to offer, and by just traveling around the world or indulging ourselves at home, not only do we wither away, but it’s not sustainable to enjoy all that we have as a society.
The amazing food we enjoy, the astonishing architecture, the amazing shows, and the impressive resorts, all were the result of people who truly wanted to perfect their craft, get fulfillment from their work, and are passionate about it. It’s ok to take a break for a year or two when you reach FI. Celebrate and travel! After that, think about where you can add value. Can you help rally your city council to fund more bike lanes? Can you fundraise for the local animal shelter? Can you volunteer at the museum? Find some fulfillment in your RE life, whether paid so you can give more back, or unpaid so you can enjoy something without worrying about a performance review or relying on a paycheck.
Some of the most vibrant festivals, glimmering parks and trails, and memorable ballot measures were the brainchild of people who had an idea, ran with it, and did something so that people down the road could enjoy them. The next time you are at a park or other open space, think of the person who planted the tree you are sitting under, the trail you walk on, and the signs you see. You might find out a long time ago, a volunteer group of residents rallied to save it from development so that they and future generations could enjoy it. Now, that’s paying it forward.