The New Spectrum of FIRE Categories

Learning about the FIRE movement was one of the driving factors behind our family’s decision to pursue new goals and take drastic measures to improve our finances.   It’s also one of the foundations of this blog.  If you’re not familiar, FIRE is Financial Independence, Retire Early.  And there is now a whole spectrum of different ways to customize your personal journey to something better than waiting for traditional retirement.   

Back when I first learned about FIRE, we were drowning in debt.  It seemed like all of the successful examples of FIRE had millions invested in 401k’s and were already retired by 30 or 40 years old.  This was inspiring and discouraging at the same time.  We have worked so hard, but it was never realistic to think that we could reach such an achievement, while raising a family!   So I used the FIRE methodology to create my own, attainable version of success, and called it “financial semi-independence.” 

Our goal of financial semi-independence (otherwise known as my kaleidoscope) involves a low cost of living, by relying on things like gardening, chickens, solar panels, and burning wood.  We already live a frugal lifestyle, but a homestead will allow us to really cut back on our external expenses.  In addition, we have been contributing to a 401k, like most adherents to FIRE.  The difference for us, is that we do not plan to touch those funds AT ALL until we reach at least traditional retirement age, whereas others retire early, but then depend on their investments for living expenses.  We will only be “semi-independent” because we will still need to earn money.  That income will come from our soon-to-be-two investment properties and my continued working, at least part-time for the foreseeable future.  The big unknown is whether my work will continue to be in the law, or whether we will reach a point where side hustles/passion projects can be enough to sustain us.       

It was very interesting to come across this excerpt (thanks to The Fioneers), which sparked a lengthy dialogue with my husband about where we fall in this spectrum – and where the categories fall short.  

It’s funny how our conversation started with trying to classify ourselves according to this new spectrum, but then it turned into a critique of these different approaches to FIRE.  A caveat: I understand that you can’t cover all aspects of these categories in short blurbs. 

First of all, it seems like some of these financial strategies shouldn’t really be considered FIRE at all.  In my opinion, Barista FIRE shouldn’t really be defined as FIRE.  If you’re still working forever, you’re not financially independent or retired.  Although we are inspired by FIRE (and may get there someday), our goal was defined as “financial semi-independence.”  

A fair amount of our frustration with this FIRE spectrum is that it leaves out too many details. Which ones are relying on investments?  If so, how much and when do they start withdrawing from the investment accounts?  What about other types of passive income, or income from rental properties?  How does that figure in to whether or not you’re considered retired?  Even the first category of Lean FIRE says absolutely nothing about income.  How are these individuals paying for their frugal lifestyle – are they working?   

Another related concern we had was about how the retirement age affects FIRE.  The national average age for retirement is now up to 65.  As people continue living longer, I have to wonder what will happen if this continues.  If the average retirement age goes up to 70, then is retiring at 60 considered early?  Will it qualify as FIRE? 

Assuming, arguendo, that these categories qualify as FIRE, we place ourselves in the following:

• 20% Lean FIRE – We keep our expenses very low, which is helping support our goal of financial semi-independence.  
• 70% Coast FIRE – This one was easiest to compare to our current plan.  My retirement account will not be touched until retirement age, and we will use part-time work and side hustles to cover our expenses for the foreseeable future.  
• 10% Slow Fire – We had to include a slice of this, because we have to enjoy the journey too, especially for the sake of the children.  The biggest example of this was our one month RV adventure in California.  

Ultimately, I think it is helpful for people to see that traditional FIRE is not the only way to achieve early retirement.  That type of FIRE is only really available to a small percentage of the population, usually those who start at a relatively young age, wait to have children, and who have a really good paying job.  As mentioned above, the FIRE success stories can be inspiring and daunting at the same time.  The real advantage provided by this spectrum is flexibility, in giving different road maps to similar opportunities.  Maybe our family can actually achieve a type of FIRE after all!  

What are your thoughts on this spectrum?  How would you classify your own journey to FIRE or other related goals?