Even if you don’t agree with the frugality of the FIRE (financial independence, retire early) movement, it’s a great launchpad to help you figure out the math behind investing enough to quit your day job.

The FIRE Movement Is Not About Being Frugal. It’s About Being Free

I came across the FIRE Movement when I started learning about paying off my $72,000 in student loans. I paid off those student loans less than a year after beginning the journey — more quickly than I expected. I then started imagining if I could actually quit the corporate job that I had dreamed of leaving for years.


As I read more about the portrayals of the extreme frugality of FIRE proponents, I quickly realized the part that appealed to me more was not retiring early. It was the financial independence part of the acronym and later I decided to change the definition of the “RE” to represent “Relax Everyday” instead.

By making that simple word change, my goal was not to stop working, but to have the freedom to choose the work I wanted to do, regardless of salary.

25 Times Your Yearly Expenses Feels Impossible At First

The FIRE movement is based on two retirement strategies used by traditional financial planners: The 25x Rule and the 4% Rule are meant to help you set up retirement savings that theoretically won’t run out for the duration of your life.


According to FIRE, in order to quit your day job, you need to have 25 times your annual expenses in investments, where you only withdraw 4% of the total each year. While you take out your living expenses, the investments are also replenishing that money through compound interest or growing in value or dividends.

This is where I started getting stuck instead of making serious money moves: I tried to dissect the 4% rule and its flaws and I immediately decided that 25 times my yearly expenses was impossible. I especially felt defeated when I heard the three broad approaches to FIRE — Fat FIRE, Lean FIRE and Barista FIRE — because of course, why would I settle for anything less than Fat FIRE?

Lean FIRE focuses on the bare minimum lifestyle to live conservatively, where Fat FIRE requires investing more money to live an indulgent lifestyle.

Start Simple And Use Math To Root Out The Self-Doubt


Instead of thinking of Fat FIRE, Lean FIRE and Barista FIRE as separate approaches, I viewed them as levels of achievement and settled on reaching Barista FIRE first. If I could maintain a more essentialist lifestyle by living off investments and part-time work, I could quit my day job and as the name suggests, work as a barista or earn some other freelance income.

I surmised that the amount of money I would need in investments would cover just five basic survival expenses: housing, utilities, food, transportation and health.

This gave me a motivational boost because it brought my 25x number down from $1.2 million to around $900,000. If I could get to this number in investments, I then could make up the difference in more discretionary expenses with work that was fun rather than obligatory.

Worry About Withdrawal Strategy After You’ve Accumulated Money

A lot of my financial education students get overwhelmed when trying to optimize their investment strategy versus investing enough money to even determine how to withdraw it later.


The harder part of the strategy is not what to invest in, but how to get enough money to invest in the first place.

So, once you figure out your Barista FIRE number for your basic lifestyle, focus your energy more on increasing your income and keep your investing strategy simple.

It took me seven years to go from $300,000 in debt to now $1.3 million in net worth thanks to salary increases, saving, contributing to retirement accounts and starting my own business.

Only now I am starting to optimize my withdrawal strategy and tax efficiency as both my husband and I entertain leaving the workforce.

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Even If You Love Your Job, It’s Good To Know It Can Be Optional

While I now work part time in my business after leaving my day job, my husband still chooses to work at a traditional 9-to-5 position.

But the level of stress he has around work is very minimal because he knows he can walk away and still feel financially secure if it ever becomes too much.

Ironically, that’s led him to being an even better performer and a more enjoyable co-worker as told by his peers, while still maintaining a healthy work-life balance.

Before you dismiss the idea of FIRE and investing 25x your expenses, consider even investing 10% of your total number. It may not allow you to permanently quit your day job, but it could buy you more time to explore life outside of work.


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