Is the FIRE Movement Too Good to Be True? 

*DONALD NATHAN SCOTT.*

Very true. It's great to save for the future, but you have to enjoy your youth also. People die in their 30s, 40s, & 50s every day. So there is no guarantee that they will make it to retirement age. You still have to live when your younger also and enjoy life.

Yes, I LOVE this! Definitely have to find that perfect balance of saving for the future and allowing yourself to spend appropriately in the present bc we aren't guaranteed tomorrow!

Both my parents past in 2022, both unexpected and in their early 60s. Glad they lived a very fulfilling life and didn’t wait till they retired. Agree, balance is definitely key to most things in life.

💯 this is why we decided to start traveling now that we are in our late 30’s. We still save at an aggressive rate but we need to enjoy as well.

Yeah. Don’t wait to enjoy your life until Ramsey says you’re allowed to.

Good for you. Way to use that oil rig job to do something positive with your wage.

100% that’s what I’m doing. My goal is to have the ‘option’ to retire (pretty comfortably) in my early 60’s. Doing the hard work now, 60+ hours a week and stashing cash/investing.

I like the idea of coast fire, but I would still feel uncomfortable until we reached FI.

Yeah sure, you'll be back at work by 40.

I'm sorry you feel that way towards people who get ahead.@@HermannTheGreat

Same. We save about 40%, about 20% goes to taxes, and health insurance...another 20% goes to mortgage interest, home insurance, utilities, and groceries. The last 20% we can spend and donate... and we can travel and not feel a speck of guilt about it.

whats HHI?

If this makes him happy, that's great. It's his life! However, I don't think this is a normal FIRE story. I think this is on the extreme side. Plus he can always go back to work to earn money if needed.

I love this idea! I am a state employee and will be able to retire in my early 50's and I love the idea of being able to do something fun part time - like work in a florist shop after I quit my full time roll. I have a friend that retired at 49 and worked part time as a handyman for a local animal rescue for several years after and it was fulfilling and far less stressful.

Good observation

These folks are brainwashed that you have to live one way, by working your life away and trying to save gobs of money for retirement, because goodness knows you can’t live on 25k a year when the rest of the world lives on a whole lot less! (Sarcasm)

That's the goal, to be so bored that you want to take on a job, not to be so broke that you need to take on a job lol

Haha me too! 😂

For you. He seems happy

His goal is $625K by the time he's 35 (he's 29 now). Still, his assumption is that he can pull $25K/year from a $625K investment portfolio. That's a 4% withdrawal rate over what might be 50+ years. I dunno....

That stress and anxiety seems to have aged him far beyond 35.

Yeah, he does seem ill

“Seems?” Look at his body. The guy clearly looks malnourished. Wouldn’t be surprised if he’s suffering from some type of mental disorder. That’s not a healthy way of living at all.

He looks starved

He's not 35. He said he's 29 years old (2:20 into the video)! He said he wants to retire when he gets to 35! My question is: if he is so anxious about spending $$ now when he has a $135K/year salary, how is he possibly going to spend $$ when he has NO income and is living off his investments? Especially when a bear market hits?

you can get 30 year bonds higher interest rate than your withdrawal rate, this is a nonsense suggestion

​@@James_36You are correct about bond yields (even T-bond yields), but you are comparing apples and oranges. The 30-year bond interest rate is fixed for 30 years. The Bengen 4% rate is just for the first year. After that, the dollar withdrawal increases with inflation, so that withdrawals are constant in real terms. Those T-bond coupons, however, are dropping in real terms every six months, because of inflation. Your recent experience with inflation at the supermarket and gas pump should serve as a warning about its biting effect on your wallet/budget. Bengen (1994) assumes you retire at 60-65 and quotes 4% as the safemax withdrawal rate. If you want to retire at 35, but you use Bengen's 4%, you risk "money death" (i.e., your money dies before you do) 25 years years before your physical death.

@@mathematician1234 even with this inflation I have managed to keep shopping costs pretty much the same, so tbh it has been a good exercise for the future. 2.5% is way too risk adverse and serves no purpose - 4% is fine

​@@James_36 Well done on keeping costs down in the face of recent inflation. I have tried to do the same, but with only limited success. It becomes increasingly difficult, however, to do that over several decades, when inflation compounds (like the return on a bank account compounding). It gets to the stage where inflation will be unavoidable. Yes, 2.5% _is_ a risk averse withdrawal rate. Yes, you can go with a 4% rule instead. Just be sure to understand the implications. For example, I just ran a quick Monte-Carlo simulation. Assume steady inflation at 2.5% per annum, assume a 7.5% simple rate of return per annum on a 50/50 stock/bond portfolio, and assume return volatility of 12% per annum. If you retire at age 35 and use a 4% rule, you have a 9% chance that your wealth will be exhausted by age 65, a 16% chance it will be exhausted by age 75, a 22% chance it will be exhausted by age 85, and a 27% chance it will be exhausted by age 95. (Roughly speaking; plus or minus a percent or two either way.) So, roughly one chance in 10 your wealth is gone by age 65, and a one in three chance it is gone by age 95. Higher assumed volatility worsens these probabilities but higher assumed returns improves them. If you use a 2.5% rule, however, those wealth exhaustion probabilities drop to 1% (age 65), 2% (age 75), 3% (age 85), and 4-5% (age 95), respectively. Of course, there are many different versions of FIRE. If you are still working, and bringing in an income, and/or worked enough years for Social Security to kick in to a noticeable degree, then you do not have to rely on your savings 100%, and you will be just fine. Incidentally, with an 8% withdrawal rate, those wealth exhaustion probabilities jump to 75% (age 65), 80% (age 75), 85% (age 85), and 90% (age 95), respectively. Actually, a couple of percentage points higher; I rounded down. So, only one chance in four your wealth lasts until age 65.

Looser

Whatever you’re smoking, please pass it around because most rents total that amount alone. To live the lifestyle you’re describing without sweating bullets requires at least $150k/year household income.

I own my home and I buy used cars which are the two biggest expenses. And I don't smoke anything which also saves money.

@@shirleysymon2160 Well you’re definitely on something… No way you bought a house and traveled on $25k/year. That’s a closing cost for most homes, not even a down payment.

@@shirleysymon2160 Do you have any other advice? For example, are you in a less expensive, possibly rural, area? Do you grow and can your own fruit and vegetables? Do you barter? Anything else you have to say on the topic of living with low expenses would be interesting. Thank you.

Who wants to live just to work?

He’s still very young and will go through more life changes, especially healthwise. Healthcare costs can break the bank so it’s important to account for that in the retirement plan.

Are you joking? The way he looks, he’s lucky to even make it to 30…

Quite impressive but HOW!!?😊 I know it's possible, my colleague at work got her first investment return of 40K after two weeks and she quit the job , I would appreciate if you show me how to go about it..

Extinction event? 🤡 🌎

I think he is starving 😥

@@jenniferspisak he does look like he is starving himself.

He should spend $15 on a good cheeseburger. Might do him well.

And with the wrong portfolio he can turn it into $312,000. Stay with index funds.

Just say no. It doesn't matter if people understand or not! It's an amazing thing what you're doing! Don't feel ashamed or pressured to participate in things that don't go well with your plan right now. Just be careful not to become anxious about any of the baby steps. Remember you're going to get to your goal and then you will be able to afford more, save more and be more generous. Everyone's journey is different.