Glossary
FIRE Retirement
FIRE stands for “Financial Independence, Retire Early”—a lifestyle and financial movement focused on aggressively saving and investing a large portion of income (often 50% or more) to achieve early retirement, typically in your 30s or 40s.
How do people achieve FIRE?
By dramatically cutting expenses, maximizing income, and investing heavily—usually in low-cost index funds or real estate—until they can live off investment returns.
What’s the typical savings goal for FIRE?
Many FIRE followers aim to save 25x their annual expenses, based on the 4% rule (withdraw 4% per year to live sustainably off investments).
Is FIRE only for high earners?
Not necessarily. While high earners can reach FIRE faster, anyone can apply FIRE principles by controlling spending and consistently saving a high percentage of income.
What are the types of FIRE?
LeanFIRE: Retiring early on a modest budget.
FatFIRE: Retiring early with a more comfortable or luxurious lifestyle.
BaristaFIRE: Reaching partial financial independence and working part-time to supplement income.
What are the risks of FIRE?
Market downturns, healthcare costs, or underestimating expenses can derail early retirement plans. Careful planning and flexibility are key.
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