Dive into the controversy of the FIRE Movement and decide if it’s sparking success or just a whimsical fantasy.
By: Imran Mohamed
Dive into the controversy of the FIRE Movement and decide if it’s sparking success or just a whimsical fantasy.
Lately, there has been a movement among young people called the FIRE movement with FIRE standing for Financial Independence Retire Early. Everyone would love to retire earlier however these guys take it to another level. Imagine transitioning to a fully minimalistic life by saving up to 70% of your income so you can retire early, Sound amazing? Imagine giving up your so treasured pick me up Starbucks $5 custom Venti Order or having to give up some of your more frivolous spending patterns just to have the hope of retiring sometime early
Hate to rain on your parade, But it can never be that simple. Financial independence is all of our dreams. Not having to work till your 60th birthday and never having to worry about being paycheck to paycheck and making ends meet is like paradise on earth. But a key element of this movement is to be as frugal as possible when trying to save to financial independence and even through retirement which for many like me, Wouldn’t be very appealing. Spending money is a very old type of joy and many like to buy extravagant things and like to enjoy the fruits of their labour while this movement aims to reel it all in. Financial independence and Retiring early is still possible however without resorting to these minimalistic practices
I Would be a hypocrite to say that I wouldn’t also like to retire early but to sacrifice my youthful years living a minimalistic lifestyle would just not cut it for me really. So I Aim to go about this another way, particularly by focusing on increasing your income instead of decreasing your expenses. By all means, cut out any liabilities that you believe aren’t really beneficial or you aren’t really enjoying but if you really enjoy something is it really a liability?
Increasing your income will not only give you short-term satisfaction but also give you enough money to invest in so your dream to retire early can be a reality. You can do this in a few ways:
-
- Learning a new skill: Learning a new skill helps you transition into higher-paying job roles. Many platforms like YouTube, Brilliant, Skillshare and LinkedIn learning are great avenues to develop highly marketable and desired skills to make you stand out in the workplace.
-
- Starting a side hustle: Many side hustles like Affiliate marketing, Freelance editing, Content creation, and other such specialities usually have a high pay ceiling and low time demand and can really be done anywhere in the world. This is why a common form of retirement is the “get a remote job and move to the tropics”. A lower cost of living combined with a high-paying remote job is really a setup made in heaven.
-
- Sale of your unused items: Listen I hear you, some of the stuff you have In your basement or attic has some sentimental value but some of the stuff in there can really give you some extra money that you can use to get yourself. Maybe explore the idea of lending them out (leasing) and getting a few extra bucks every month. Every little helps and helps you towards your goal of financial independence and retiring early!
-
- Explore passive income: look for smaller investment avenues to make a few more every month. For those with a higher budget explore options in Student accommodation real estate as those generally have relatively lower Property prices with a high ROI. With those with a lower budget, you should try and explore some High Dividend ETFs and other such cash flow Generating Assets.
The problem with Saving
Say you saved about a collective £10,000 through the whole of 2023 and put it into a generic cash savings account offered by any High Street bank with an average APR of say 3.15% (source: Moneyfacts). By the end of the year, you’d have about 10,315 pounds. That’s all well and good but this increase in value is nothing but an illusion as your money is now worth less than it was last year in terms of what you can buy as the average inflation rate for that year was 5.2% as of November 2023. So in essence you have lost around 2 % of your money even if you had saved it. And that’s not even adding the further Tax you must pay on all increases in savings money (After a certain threshold that is) While this is better than losing the entire 5.2%, Surely you must ask yourself was it even worth saving to begin with?
The answer to that is complicated to say as saving for the future in case of emergency is always a good idea and to be getting interest on that money to cushion the fall of your purchasing power. So you may ask yourself that is there other ways to get around Savings accounts and actually be able to SAVE some money. There are a variety of options for those willing to take a little risk in doing so
-
- Stocks and shares ISA: For those ready to get nillywilly into the world of stocks and shares. This ISA is for you. With it being fully tax-free on all investment returns and allowing you to invest up to £20,000 every calendar year it’s a great opportunity for those who know a little about this side of the market. I will soon write an article about the basics of stocks and where to learn more about the crazy world of financial tools
-
- Cash ISA: this one is generally for people who have up to £20,000 a year to save with the returns being fully not liable to taxes. Can also be transferred between owners in the event of an unexpected demise with no inheritance tax either. Does have a limit compared to a savings account as only one account of its kind can be opened
-
- Lifetime ISAs: this is for those who wish to put money down for the very long term (talking 50s here) maximum deposit is £4000 but an insane interest rate of about 25% making this a big hitter but only because you can withdraw it all at age 50 (again it’s a catfish really, max £1000 a year)
All these options allow you, should you fit the conditions, A tax-free experience with some flexibility as instant cash ISAs are just as flexible as bank savings accounts just with a tax benefit. The only downside is that they tend to have a lower interest rate than some Conventional savings accounts but some match them or are slightly lower.
A Silver Lining (Literally)
Step into the vibrant markets of the global south, and you’ll encounter a fascinating financial phenomenon that might raise eyebrows in the West. In lands like India, the Middle East and Africa the currency of wealth isn’t just measured in numbers; it gleams in the form of gold. A captivating tidbit unveils a stunning statistic: Indian women collectively own around 11% of the world’s gold, an astonishing 21,000 tons—outshining the combined reserves of the USA, IMF, Switzerland, and Germany. Beyond a precious metal, gold stands as a cultural cornerstone, particularly in the intricacies of marriage within Many African and Middle Eastern cultures
Now, shift your gaze to the global north, where the familiar adage, “Cash is King,” echoes through financial corridors. Yet, a compelling argument challenges this norm, gaining momentum as more embrace the notion of storing wealth in gold and silver. This isn’t just a nod to tradition; it’s a savvy financial strategy laced with intriguing advantages.
One standout perk of amassing wealth in gold lies in its inherent power to shield against the erosive forces of inflation. Unlike traditional currencies, which may wilt under inflation’s pressure, gold tends to glitter brighter over time, keeping pace with the ever-rising cost of living. Picture it as a protective shield, guarding wealth across generations and standing as a timeless hedge against the financial wear and tear of inflation.
Yet, this golden path to financial wisdom isn’t without its challenges. The relative lack of liquidity, especially when compared to the convenient flow of traditional savings accounts, can pose Tricky puzzles. Transporting and safeguarding physical gold adds an extra layer of inconvenience, an Obstacle really and one that many who invest in it find a way to do in their own complex financial journey.
This gold versus cash debate isn’t a simple choice; it’s a blend of culture, economics, and practicality shaping how we handle money. Gold symbolizes prosperity, drawing fans globally, while cash remains king in the financial roots of the global north. As the world evolves, so do our methods of measuring and protecting wealth, prompting reflection on tradition and adaptability. But as you Can see it can be Quite effective
Compound interest
Compound interest is the eighth wonder of the world. He who understands it earns it; he who doesn’t pays it.- Albert Einstein
Understanding the inner workings of stocks unveils the reason winners invest while mere savers often fall behind. Despite the higher risk, if asked to choose between saving and diving into stocks, I’d pick the latter 99 times out of 100. It all boils down to grasping the magic of compound interest, hailed by Einstein as the 8th wonder of the world.
Let’s zoom in on the Standard and Poor’s 500 (S&P 500) as an example. Over the past decade, it has consistently delivered an impressive 12% return annually since 2013. Consider this: if I started with a $5000 lump sum and added $1000 monthly, my interest would soar to around $121,540. In a parallel universe of a savings account, the interest would cap at a mere $38,517 over the same period—a nearly threefold difference. So, why the favouritism? Besides, stocks emerge as the closest thing to an “inflation-proof” investment, often outpacing inflation significantly, alongside businesses and real estate ( and as previously mentioned those precious metals) .
Sure, the stock market can seem daunting, especially with horror stories echoing from past failures. But fear not, safe investing is no myth. All it takes is a solid strategy, and you’ll be soaring high in no time. Stay tuned for a deeper dive into this in a future post!
In conclusion, Yes retiring early is possible but having to maintain a life of constant frugality, having to watch everything you buy and living that way through retirement isn’t the way. The best kind of life is a life where you do what you enjoy and the best way to live a good life while also making sure that you can retire early Is by creating passive income sources while you are young so when you want to retire, you can kick back In your hammock in the Bahamas knowing you did all right for yourself. Or be a wage slave till 70 as they increase the working age every year and food becomes way too expensive and you have to eat lab meat for the rest of your life. Just a suggestion. Catch y’all in the next one
Dive into the controversy of the FIRE Movement and decide if it’s sparking success or just a whimsical fantasy.
By: Imran Mohamed
Lately, there has been a movement among young people called the FIRE movement with FIRE standing for Financial Independence Retire Early. Everyone would love to retire earlier however these guys take it to another level. Imagine transitioning to a fully minimalistic life by saving up to 70% of your income so you can retire early, Sound amazing? Imagine giving up your so treasured pick me up Starbucks $5 custom Venti Order or having to give up some of your more frivolous spending patterns just to have the hope of retiring sometime early
Hate to rain on your parade, But it can never be that simple. Financial independence is all of our dreams. Not having to work till your 60th birthday and never having to worry about being paycheck to paycheck and making ends meet is like paradise on earth. But a key element of this movement is to be as frugal as possible when trying to save to financial independence and even through retirement which for many like me, Wouldn’t be very appealing. Spending money is a very old type of joy and many like to buy extravagant things and like to enjoy the fruits of their labour while this movement aims to reel it all in. Financial independence and Retiring early is still possible however without resorting to these minimalistic practices
I Would be a hypocrite to say that I wouldn’t also like to retire early but to sacrifice my youthful years living a minimalistic lifestyle would just not cut it for me really. So I Aim to go about this another way, particularly by focusing on increasing your income instead of decreasing your expenses. By all means, cut out any liabilities that you believe aren’t really beneficial or you aren’t really enjoying but if you really enjoy something is it really a liability?
Increasing your income will not only give you short-term satisfaction but also give you enough money to invest in so your dream to retire early can be a reality. You can do this in a few ways:
- Learning a new skill: Learning a new skill helps you transition into higher-paying job roles. Many platforms like YouTube, Brilliant, Skillshare and LinkedIn learning are great avenues to develop highly marketable and desired skills to make you stand out in the workplace.
- Starting a side hustle: Many side hustles like Affiliate marketing, Freelance editing, Content creation, and other such specialities usually have a high pay ceiling and low time demand and can really be done anywhere in the world. This is why a common form of retirement is the “get a remote job and move to the tropics”. A lower cost of living combined with a high-paying remote job is really a setup made in heaven.
- Sale of your unused items: Listen I hear you, some of the stuff you have In your basement or attic has some sentimental value but some of the stuff in there can really give you some extra money that you can use to get yourself. Maybe explore the idea of lending them out (leasing) and getting a few extra bucks every month. Every little helps and helps you towards your goal of financial independence and retiring early!
- Explore passive income: look for smaller investment avenues to make a few more every month. For those with a higher budget explore options in Student accommodation real estate as those generally have relatively lower Property prices with a high ROI. With those with a lower budget, you should try and explore some High Dividend ETFs and other such cash flow Generating Assets.
The problem with Saving
Say you saved about a collective £10,000 through the whole of 2023 and put it into a generic cash savings account offered by any High Street bank with an average APR of say 3.15% (source: Moneyfacts). By the end of the year, you’d have about 10,315 pounds. That’s all well and good but this increase in value is nothing but an illusion as your money is now worth less than it was last year in terms of what you can buy as the average inflation rate for that year was 5.2% as of November 2023. So in essence you have lost around 2 % of your money even if you had saved it. And that’s not even adding the further Tax you must pay on all increases in savings money (After a certain threshold that is) While this is better than losing the entire 5.2%, Surely you must ask yourself was it even worth saving to begin with?
The answer to that is complicated to say as saving for the future in case of emergency is always a good idea and to be getting interest on that money to cushion the fall of your purchasing power. So you may ask yourself that is there other ways to get around Savings accounts and actually be able to SAVE some money. There are a variety of options for those willing to take a little risk in doing so
- Stocks and shares ISA: For those ready to get nillywilly into the world of stocks and shares. This ISA is for you. With it being fully tax-free on all investment returns and allowing you to invest up to £20,000 every calendar year it’s a great opportunity for those who know a little about this side of the market. I will soon write an article about the basics of stocks and where to learn more about the crazy world of financial tools
- Cash ISA: this one is generally for people who have up to £20,000 a year to save with the returns being fully not liable to taxes. Can also be transferred between owners in the event of an unexpected demise with no inheritance tax either. Does have a limit compared to a savings account as only one account of its kind can be opened
- Lifetime ISAs: this is for those who wish to put money down for the very long term (talking 50s here) maximum deposit is £4000 but an insane interest rate of about 25% making this a big hitter but only because you can withdraw it all at age 50 (again it’s a catfish really, max £1000 a year)
All these options allow you, should you fit the conditions, A tax-free experience with some flexibility as instant cash ISAs are just as flexible as bank savings accounts just with a tax benefit. The only downside is that they tend to have a lower interest rate than some Conventional savings accounts but some match them or are slightly lower.
A Silver Lining (Literally)
Step into the vibrant markets of the global south, and you’ll encounter a fascinating financial phenomenon that might raise eyebrows in the West. In lands like India, the Middle East and Africa the currency of wealth isn’t just measured in numbers; it gleams in the form of gold. A captivating tidbit unveils a stunning statistic: Indian women collectively own around 11% of the world’s gold, an astonishing 21,000 tons—outshining the combined reserves of the USA, IMF, Switzerland, and Germany. Beyond a precious metal, gold stands as a cultural cornerstone, particularly in the intricacies of marriage within Many African and Middle Eastern cultures
Now, shift your gaze to the global north, where the familiar adage, “Cash is King,” echoes through financial corridors. Yet, a compelling argument challenges this norm, gaining momentum as more embrace the notion of storing wealth in gold and silver. This isn’t just a nod to tradition; it’s a savvy financial strategy laced with intriguing advantages.
One standout perk of amassing wealth in gold lies in its inherent power to shield against the erosive forces of inflation. Unlike traditional currencies, which may wilt under inflation’s pressure, gold tends to glitter brighter over time, keeping pace with the ever-rising cost of living. Picture it as a protective shield, guarding wealth across generations and standing as a timeless hedge against the financial wear and tear of inflation.
Yet, this golden path to financial wisdom isn’t without its challenges. The relative lack of liquidity, especially when compared to the convenient flow of traditional savings accounts, can pose Tricky puzzles. Transporting and safeguarding physical gold adds an extra layer of inconvenience, an Obstacle really and one that many who invest in it find a way to do in their own complex financial journey.
This gold versus cash debate isn’t a simple choice; it’s a blend of culture, economics, and practicality shaping how we handle money. Gold symbolizes prosperity, drawing fans globally, while cash remains king in the financial roots of the global north. As the world evolves, so do our methods of measuring and protecting wealth, prompting reflection on tradition and adaptability. But as you Can see it can be Quite effective
Compound interest
Compound interest is the eighth wonder of the world. He who understands it earns it; he who doesn’t pays it.- Albert Einstein
Understanding the inner workings of stocks unveils the reason winners invest while mere savers often fall behind. Despite the higher risk, if asked to choose between saving and diving into stocks, I’d pick the latter 99 times out of 100. It all boils down to grasping the magic of compound interest, hailed by Einstein as the 8th wonder of the world.
Let’s zoom in on the Standard and Poor’s 500 (S&P 500) as an example. Over the past decade, it has consistently delivered an impressive 12% return annually since 2013. Consider this: if I started with a $5000 lump sum and added $1000 monthly, my interest would soar to around $121,540. In a parallel universe of a savings account, the interest would cap at a mere $38,517 over the same period—a nearly threefold difference. So, why the favouritism? Besides, stocks emerge as the closest thing to an “inflation-proof” investment, often outpacing inflation significantly, alongside businesses and real estate ( and as previously mentioned those precious metals) .
Sure, the stock market can seem daunting, especially with horror stories echoing from past failures. But fear not, safe investing is no myth. All it takes is a solid strategy, and you’ll be soaring high in no time. Stay tuned for a deeper dive into this in a future post!
In conclusion, Yes retiring early is possible but having to maintain a life of constant frugality, having to watch everything you buy and living that way through retirement isn’t the way. The best kind of life is a life where you do what you enjoy and the best way to live a good life while also making sure that you can retire early Is by creating passive income sources while you are young so when you want to retire, you can kick back In your hammock in the Bahamas knowing you did all right for yourself. Or be a wage slave till 70 as they increase the working age every year and food becomes way too expensive and you have to eat lab meat for the rest of your life. Just a suggestion. Catch y’all in the next one
Dive into the controversy of the FIRE Movement and decide if it’s sparking success or just a whimsical fantasy.
By: Imran Mohamed
Lately, there has been a movement among young people called the FIRE movement with FIRE standing for Financial Independence Retire Early. Everyone would love to retire earlier however these guys take it to another level. Imagine transitioning to a fully minimalistic life by saving up to 70% of your income so you can retire early, Sound amazing? Imagine giving up your so treasured pick me up Starbucks $5 custom Venti Order or having to give up some of your more frivolous spending patterns just to have the hope of retiring sometime early
Hate to rain on your parade, But it can never be that simple. Financial independence is all of our dreams. Not having to work till your 60th birthday and never having to worry about being paycheck to paycheck and making ends meet is like paradise on earth. But a key element of this movement is to be as frugal as possible when trying to save to financial independence and even through retirement which for many like me, Wouldn’t be very appealing. Spending money is a very old type of joy and many like to buy extravagant things and like to enjoy the fruits of their labour while this movement aims to reel it all in. Financial independence and Retiring early is still possible however without resorting to these minimalistic practices
I Would be a hypocrite to say that I wouldn’t also like to retire early but to sacrifice my youthful years living a minimalistic lifestyle would just not cut it for me really. So I Aim to go about this another way, particularly by focusing on increasing your income instead of decreasing your expenses. By all means, cut out any liabilities that you believe aren’t really beneficial or you aren’t really enjoying but if you really enjoy something is it really a liability?
Increasing your income will not only give you short-term satisfaction but also give you enough money to invest in so your dream to retire early can be a reality. You can do this in a few ways:
- Learning a new skill: Learning a new skill helps you transition into higher-paying job roles. Many platforms like YouTube, Brilliant, Skillshare and LinkedIn learning are great avenues to develop highly marketable and desired skills to make you stand out in the workplace.
- Starting a side hustle: Many side hustles like Affiliate marketing, Freelance editing, Content creation, and other such specialities usually have a high pay ceiling and low time demand and can really be done anywhere in the world. This is why a common form of retirement is the “get a remote job and move to the tropics”. A lower cost of living combined with a high-paying remote job is really a setup made in heaven.
- Sale of your unused items: Listen I hear you, some of the stuff you have In your basement or attic has some sentimental value but some of the stuff in there can really give you some extra money that you can use to get yourself. Maybe explore the idea of lending them out (leasing) and getting a few extra bucks every month. Every little helps and helps you towards your goal of financial independence and retiring early!
- Explore passive income: look for smaller investment avenues to make a few more every month. For those with a higher budget explore options in Student accommodation real estate as those generally have relatively lower Property prices with a high ROI. With those with a lower budget, you should try and explore some High Dividend ETFs and other such cash flow Generating Assets.
The problem with Saving
Say you saved about a collective £10,000 through the whole of 2023 and put it into a generic cash savings account offered by any High Street bank with an average APR of say 3.15% (source: Moneyfacts). By the end of the year, you’d have about 10,315 pounds. That’s all well and good but this increase in value is nothing but an illusion as your money is now worth less than it was last year in terms of what you can buy as the average inflation rate for that year was 5.2% as of November 2023. So in essence you have lost around 2 % of your money even if you had saved it. And that’s not even adding the further Tax you must pay on all increases in savings money (After a certain threshold that is) While this is better than losing the entire 5.2%, Surely you must ask yourself was it even worth saving to begin with?
The answer to that is complicated to say as saving for the future in case of emergency is always a good idea and to be getting interest on that money to cushion the fall of your purchasing power. So you may ask yourself that is there other ways to get around Savings accounts and actually be able to SAVE some money. There are a variety of options for those willing to take a little risk in doing so
- Stocks and shares ISA: For those ready to get nillywilly into the world of stocks and shares. This ISA is for you. With it being fully tax-free on all investment returns and allowing you to invest up to £20,000 every calendar year it’s a great opportunity for those who know a little about this side of the market. I will soon write an article about the basics of stocks and where to learn more about the crazy world of financial tools
- Cash ISA: this one is generally for people who have up to £20,000 a year to save with the returns being fully not liable to taxes. Can also be transferred between owners in the event of an unexpected demise with no inheritance tax either. Does have a limit compared to a savings account as only one account of its kind can be opened
- Lifetime ISAs: this is for those who wish to put money down for the very long term (talking 50s here) maximum deposit is £4000 but an insane interest rate of about 25% making this a big hitter but only because you can withdraw it all at age 50 (again it’s a catfish really, max £1000 a year)
All these options allow you, should you fit the conditions, A tax-free experience with some flexibility as instant cash ISAs are just as flexible as bank savings accounts just with a tax benefit. The only downside is that they tend to have a lower interest rate than some Conventional savings accounts but some match them or are slightly lower.
A Silver Lining (Literally)
Step into the vibrant markets of the global south, and you’ll encounter a fascinating financial phenomenon that might raise eyebrows in the West. In lands like India, the Middle East and Africa the currency of wealth isn’t just measured in numbers; it gleams in the form of gold. A captivating tidbit unveils a stunning statistic: Indian women collectively own around 11% of the world’s gold, an astonishing 21,000 tons—outshining the combined reserves of the USA, IMF, Switzerland, and Germany. Beyond a precious metal, gold stands as a cultural cornerstone, particularly in the intricacies of marriage within Many African and Middle Eastern cultures
Now, shift your gaze to the global north, where the familiar adage, “Cash is King,” echoes through financial corridors. Yet, a compelling argument challenges this norm, gaining momentum as more embrace the notion of storing wealth in gold and silver. This isn’t just a nod to tradition; it’s a savvy financial strategy laced with intriguing advantages.
One standout perk of amassing wealth in gold lies in its inherent power to shield against the erosive forces of inflation. Unlike traditional currencies, which may wilt under inflation’s pressure, gold tends to glitter brighter over time, keeping pace with the ever-rising cost of living. Picture it as a protective shield, guarding wealth across generations and standing as a timeless hedge against the financial wear and tear of inflation.
Yet, this golden path to financial wisdom isn’t without its challenges. The relative lack of liquidity, especially when compared to the convenient flow of traditional savings accounts, can pose Tricky puzzles. Transporting and safeguarding physical gold adds an extra layer of inconvenience, an Obstacle really and one that many who invest in it find a way to do in their own complex financial journey.
This gold versus cash debate isn’t a simple choice; it’s a blend of culture, economics, and practicality shaping how we handle money. Gold symbolizes prosperity, drawing fans globally, while cash remains king in the financial roots of the global north. As the world evolves, so do our methods of measuring and protecting wealth, prompting reflection on tradition and adaptability. But as you Can see it can be Quite effective
Compound interest
Compound interest is the eighth wonder of the world. He who understands it earns it; he who doesn’t pays it.- Albert Einstein
Understanding the inner workings of stocks unveils the reason winners invest while mere savers often fall behind. Despite the higher risk, if asked to choose between saving and diving into stocks, I’d pick the latter 99 times out of 100. It all boils down to grasping the magic of compound interest, hailed by Einstein as the 8th wonder of the world.
Let’s zoom in on the Standard and Poor’s 500 (S&P 500) as an example. Over the past decade, it has consistently delivered an impressive 12% return annually since 2013. Consider this: if I started with a $5000 lump sum and added $1000 monthly, my interest would soar to around $121,540. In a parallel universe of a savings account, the interest would cap at a mere $38,517 over the same period—a nearly threefold difference. So, why the favouritism? Besides, stocks emerge as the closest thing to an “inflation-proof” investment, often outpacing inflation significantly, alongside businesses and real estate ( and as previously mentioned those precious metals) .
Sure, the stock market can seem daunting, especially with horror stories echoing from past failures. But fear not, safe investing is no myth. All it takes is a solid strategy, and you’ll be soaring high in no time. Stay tuned for a deeper dive into this in a future post!
In conclusion, Yes retiring early is possible but having to maintain a life of constant frugality, having to watch everything you buy and living that way through retirement isn’t the way. The best kind of life is a life where you do what you enjoy and the best way to live a good life while also making sure that you can retire early Is by creating passive income sources while you are young so when you want to retire, you can kick back In your hammock in the Bahamas knowing you did all right for yourself. Or be a wage slave till 70 as they increase the working age every year and food becomes way too expensive and you have to eat lab meat for the rest of your life. Just a suggestion. Catch y’all in the next one
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