What does FIRE mean to me?

 

The past few months has seen increased coverage of the Financial Independence, Retire Early (“FIRE”) movement in Singapore. This post pens down my thoughts on why I’m pursuing FIRE. The draft was written over the past month, whenever certain thoughts cross my mind, so pardon me if the post appears incoherent at times. Maybe reading this on a Friday evening won’t feel that bad, since it’s the end of the work week; I’d suggest reading this again on Monday morning for a good juxtaposition.

To be honest, I’m pleasantly surprised that the media covered the FIRE movement so frequently. Anyway, here are the articles I’ve come across. The first one would be Honey Money’s goal of 1M35 (1M65 is no longer in vogue). It’s an ambitious goal, yet entirely achievable. To me, retirement shouldn’t be defined by an age – it should be defined by reaching a certain net worth.

The most comprehensive one would be this one by CNA that interviewed many individuals who either have achieved some form of FIRE or are actively working towards it. It features @centsofindependence a Singaporean lady in her 40s who achieved Barista FIRE and now only works for a few hours each week. A true inspiration. Since I’m obviously not influential enough for CNA to interview me… I’ve only got this platform to share my thoughts!

Another opinion piece on CNA attempted to paint a “balanced” view that we have to manage delayed gratification with “living in the present” and enjoying life, which I completely agree with. But my main gripe is that the author appears to hold a warped view of FIRE aspirants being extreme misers, practicing an extreme form of frugality that is unthinkable to the average person.

Seriously, few people would think of eating cup noodles and plain bread everyday as a viable way to achieve FIRE. Most people I know aspiring to reach FIRE still live fulfilling lives. It’s about striking a balance. It’s about mitigating lifestyle inflation or going down the slippery slope comparing yourself to others, and thinking that material indulgences would make you feel better.

To be clear, FIRE is a divisive topic. Especially in Singapore where “hard work” (regardless of actual productivity) is valued above all else. Thus, it should come as no surprise that the recent posts in the media have stirred strong opinions on both sides. I believe in pursuing FIRE, but I do not hold hard feelings against those who think otherwise. I think people should be given the free will to decide for themselves – and take responsibility for their own decisions.

This post outlines my reasons for pursuing FIRE. This post would focus mainly on my “why”. The “how” is covered in my monthly Instagram updates, as well as the occasional blog post (read: Seeking FIRE – The Route to Financial Freedom). But for the benefit of new readers, if I were to summarise the “how” into a one-liner, it would be to live frugally (>50% savings rate), invest nearly all your excess cash, and consistently buy a bunch of dividend-paying ETFs, no matter what. Investing should be simple. Investing should be easy. And we don’t have to overcomplicate that.

Now that we’ve set the context for this post, here are the reasons why I believe pursuing FIRE is a worthy cause.

FIRE means Freedom

Society places an overemphasis on “productivity”. Go to school, get a job, and be a cog in this giant machine known as the capitalistic system. But why should it be this way? I think all of us have an innate desire for freedom, to be set free from the shackles of the corporate world.

Don’t you miss the carefree days as a student? When I get asked the question of whether I prefer to be a student or to work, it is clear to me that the life of a student is superior, by far. Work is simply a means to an end – earn a salary, accumulate cash flow generating assets, and gradually replace your active income with passive income.

Currently, you’re exchanging your time for money. At some point, don’t forget to exchange your money for time. The latter is exactly what FIRE is about – when your passive income replaces your active income, you’re literally buying your own ticket to freedom.

Feel like doing nothing this week? Then simply do nothing! Spend your days in the library reading a book you love. Go to the driving range on a weekday afternoon when it isn’t crowded. Maybe laze your afternoons away at a beach club, getting that tan. Sit at a café while sipping tea and people-watching. It basically means doing whatever you want, whenever you want. As long as it’s legal, of course.

FIRE means you Have Options

In my view, the cliché “Money can’t buy happiness”, should read something like “Money may not buy happiness, but it sure does make many things easier”. In the case of FIRE, having a portfolio generating passive income buys you options. I once came across an Instagram post that mentioned “A lot of things that require courage, can be achieved with money too”. Quitting a job without another one lined up? Money helps. Cancelling your wedding at the last minute without regard for the sunk costs? Money helps. Moving to a new country to start afresh? Money helps.

Having options give you the bargaining power to walk away when necessary. Unreasonable expectations from your manager? Quit. Overwhelmed by your workload? Quit. Your company suddenly mandates 5 days a week in office for no good reason? Quit. Underappreciated and underpaid? Quit. And take as much time as you need to find a new role that suits you. Or perhaps never work again.

That’s the power of having f- you money. One of my favorite scenes from Billions (S1E1) was Axelrod’s “what’s the point of having f- you money, if you never say f- you?”

FIRE means truly being able to Do What You Love

“Hustle culture” has created a warped perspective of hobbies. People that subscribe to this mentality become overly fixated on finding “side hustles” and trying to monetise any hobby of theirs. Love photography? Why not be a freelance photographer and start charging for shoots? Love video editing? Why not be a freelance video editor and find opportunities on Fiverr?

Attaining financial freedom (or at least Barista FIRE) removes all these shackles of viewing things through a financial standpoint. Work becomes optional. You’re working because you want to, not because you have to. In the case of Barista FIRE, you’re working only to fund your discretionary expenses. You have greater autonomy to pick what you love, with little regard for what’s financially viable. If you’ve achieved FIRE, then you don’t really care whether what you’re doing pays well or not.

I think two key questions to ask yourself are “Would you work at your current role for free?” and “If you won the lottery of $10 million, would you still stay in your current role?”. You have your answer.

Personally, I would do many things for free. I love writing. But writing this blog gives me near zero financial gain (I used to run AdSense which pays a few dollars per month). Another thing I’d do for free would be a career advisor / interview coach. I think I’d do fairly well as one. Extremely ironic given the strong anti-work rhetoric here, I know. But I do decently well at interviews. And I’m always focused on the pay-to-effort ratio, which I think should be the basis for evaluating any potential opportunities.

In short, FIRE gives you the liberty to pursue you’re the things you love, without the financial pressure. Perhaps being a Personal Trainer that takes just one client a day. Or volunteering frequently to help the underprivileged. Or travelling the world while picking up different languages. Whatever you want, without the financial pressure.

FIRE means Being in Control

Let’s face it – many things in life are beyond our control. You could be the most hardworking person on the team, but if your boss doesn’t like you, then too bad, you probably won’t be rewarded fairly for the effort you put in. That’s beyond your control. You could be the most competent team member, but passed up on promotion because someone else is a better bootlicker or ass kisser. That’s beyond your control. You could be the best interview candidate, but did not get the job due to nepotism. Again, that’s beyond your control.

FIRE means putting that power back into your hands. The ability to dictate the life you want to live, instead of being beholden to someone else. Not having someone else determine your destiny. It means having the ability to say no. Saying no to unreasonable work deadlines. Saying no, instead of feeling like you have to drink “one more glass” because your boss asked you to.

FIRE means having a safety net

Recession – the scary word that’s in many conversations these days. Every week we hear of a different tech company laying off employees. Job security cannot be taken for granted these days.  

In Singapore, it is easy to be caught up in the chase for material possessions. Wanting to project a certain ideal image of “success”. Consequently, lifestyle inflation creeps in. Hefty mortgage payments for your multi-million-dollar condo where you only use the facilities twice a year. Loans for that Mercedes that you bought to impress your relatives once a year during CNY. Overextending your finances and overleveraging. And what happens when you lose your job? You’re screwed.

FIRE means the exact opposite. It means valuing frugality. It means being wary of lifestyle inflation. It means valuing freedom over material wealth. It means providing yourself with a safety net that insulates you from the economic cycle.

And what good does this bring? With this safety net, you can take as much career risk as you like. Pivot to a different industry without worrying about whether it’ll work out. Or do a post-grad degree simply because you love learning. Or give a shot at entrepreneurship, knowing well that there are little consequences even if you fail.

We all love a good rags to riches story of how someone started with nothing, yet built a successful business. Jack Ma’s story of being rejected from the KFC job; waiting outside a hotel to practice English comes to mind. But statistically, entrepreneurs who come from wealth are more likely to succeed. FIRE gives you that safety net.

My Job is not My Identity

I don’t need a job to provide me with “purpose” or “meaning”. I think these are just abstract concepts to keep people on the hedonic treadmill. I don’t need a job for my identity. I don’t need to say “I work at a Bulge Bracket Investment Bank” or “I work at a Tier 1 Consulting firm” or “I am an SWE at FAANG” to feel that I’ve “made it”.

My identity is made up of personality. My hobbies. My interests. My talents. The experiences I’ve lived through. My relationships with people. The lives I’ve impacted (including you, reading this now). 

I love the outdoors. I love various sports. I love learning new languages. I love watching documentaries. I love reading and writing. These are what matters most to me. I am intrinsically motivated by these; not titles, not awards, not money. Money is very important, but it is simply a tool, a means to an end.

A valid question to ask here would be – why can’t the above be complementary to a full-time job? You can still enjoy your hobbies while being employed. Sure, fair point. But I think the response to that would be why do we see employment as the status quo? The concept of the 9 to 5 work day only became mainstream during the industrial revolution – a schedule for labourers to work in factories.  

I envision FIRE to be a time when I have too many hobbies to pursue, but too little time. Not fearing retirement as a phase where you’ll be “too bored”.

Some people make their jobs their entire personality. They can’t stop talking about work. About the “important” things that they’re working on.

If you need your boss to give you a pat on the back and say “Well Done!” to feel appreciated, or if winning that annual company award for “Going above and beyond” gives you a dopamine boost, or if you need to write a lengthy LinkedIn post about how you “worked hard over the past year to complete this deal” to feel accomplished, then you are vulnerable. Because… all these can be taken away from you in an instant. Often through no fault of yours. Restructurings, layoffs, bankruptcies are part and parcel of capitalism.

I would suggest watching Sebastian Vettel’s video announcing his retirement from F1. A brilliant speech his on how his identity is more than just his job.

You’ve probably heard the quote “find a job you love, and you’ll never feel like you’re working”. But let’s be realistic here. The hard truth is that there won’t be enough dream jobs for everyone. The majority of people are simply working to pay the bills.

What if you love your job?

At this point of the article, all those who love their job would have likely closed the webpage. Why aim to retire early if you truly enjoy your work? But if you love your job and somehow you’re still reading, here are my thoughts.

If you love what you do, work with a great leader, have good work life balance / flexibility, get compensated fairly and have great colleagues, then great, I am truly happy for you. But in this dynamic world, anything can change instantly. Your great leader and colleagues may leave. Team morale drops. Workload increases. Budget cuts. Or some inevitable restructurings happen as mentioned earlier.

Based on anecdotal evidence from friends I speak to frequently (n≈20), maybe about a quarter absolutely detest what they do. They work in a shit job, get paid peanuts, or both. About half are neutral. Some just go with the flow and hold the view that employment is simply a means to earn a living and pay the bills. Some may still hate their job, but they could be paid extremely well that compensates for that. The classic long hours, pressure cooker environment, but well compensated. Some are genuinely lost and think that working till you’re 65 is the “standard” way of living. Only perhaps a privileged few have found something they truly love. And I’m happy for them.

A friend loved her job. Her role gave her the option of flexible work for the past two years. She was doing well at her role. But out of the blue, her firm decided to recall everyone back to office 5 days a week, simply because they could. Yet, her role involves frequent interactions outside the office, so it makes little sense for the team to work from office the rest of the time. She has caregiver responsibilities for her elderly parents and the previous flexible arrangements worked perfectly for her. She has tried to put in a request for hybrid work but was rebuffed. Stories like these happen all too often.   

The bottom line is, you’ll never know when you need your safety net. FIRE is that safety net.

All in all, FIRE to me means freedom. It means pursuing what I love. It means having options. It means being in control. It means acting in my best interests. It means being authentic. And I think that’s beautiful.