Why I am Not a Proponent of the Financial Independence, Retire Early (FIRE) Movement

Because I am a financial coach, most people assume that I am a strong proponent of the FIRE movement. If you have never heard of it before this acronym stands for Financial Independence, Retire Early. The FIRE movement started gaining momentum around 2010 and since then has taken off in millennium communities around the globe.

Although anyone can technically embark on a FIRE journey, it is primarily appealing to younger individuals who have a significant amount of time to save for and enjoy an early retirement. These individuals usually start their FIRE journey in their early work life and are able to retire in their 30’s or 40’s. Of course, this is significantly earlier than the traditional age of 65.

Some individuals in their 30’s and 40’s are also starting their own FIRE journey in hopes of retiring in their 50’s. Regardless of the age or stage in life the goal of FIRE is to save and invest enough money so that you can retire early.

This generally involves taking very aggressive steps to save and invest 50% or more of one’s income. Typically, these individuals find ways to cut corners in every way. This usually means not dining out, not enjoying fee-based entertainment, not accumulating debt, etc.

Individuals in the FIRE movement are also highly encouraged to increase their income. This generally means having a side hustle or starting a business. Having more finances means being able to save more money, which can help one achieve retirement much sooner.

What I Like About the FIRE Movement

Now before I get to the reasons why I don’t support the FIRE movement, I want to share what I do like about the movement. It definitely espouses many of the financial principles that I believe in.

The FIRE movement promotes saving and investing, which is something that I encourage all of my clients to do. Embarking on a FIRE journey requires you to take a critical look at your finances, which can help you make sound financial decisions in the long run.

You can quickly see and eradicate excessive spending habits when you commit to a strategic savings and investing plan. This can quickly eliminate poor spending habits that lead to insurmountable debt.

The FIRE movement also promotes financial independence, which typically leads to entrepreneurship. I am a strong proponent of business ownership because it often leads to self-reliance. It also gives you the freedom to pursue your own vision that can easily be aligned with your value systems. Because you are free to set your own schedule and work according to your own terms you don’t have to depend on others for financial security.

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All of these aspects of the FIRE journey are very commendable. In fact, I teach these very principles to my clients. Yet, I do so from a liberating and sustainable perspective.

Why I Don’t Support the FIRE Movement

In many instances a FIRE journey equates to extreme deprivation. This means giving up the things that you most enjoy in life. Such deprivation is generally inordinate and often leads to major issues in other areas of your life.

I believe that any financial journey should be about achieving and maintaining freedom and enjoyment in every area of life. Extreme self-deprivation is not conducive to creating such an environment.

FIRE is Counterproductive to Holistic Well-Being

Skimming back on luxuries or slimming down your budget is one thing. But completely giving up everything that is not 100% necessary to your physiological well-being is extreme. We have other needs in life which include our spiritual, emotional, and mental well-being. Typically, a FIRE lifestyle doesn’t support these other areas of need which are detrimental to our holistic well-being.

Sometimes we need to celebrate small and large victories in our life. In today’s society that often means celebrating through the purchase of items like clothing, accessories, food, etc., going out with loved ones, engaging in self-care, etc. These things generally cost money, which is typically not an allowable part of a FIRE budget.

Balance is necessary for us to enjoy a happy, fruitful existence. This means that we should not be at the extreme end of the spectrum in any regard. If you deprive yourself of life’s basic pleasures like enjoying good food, socializing, and other activities that make you human this can lead to mental imbalances. Most often it leads to depression and anxiety and sometimes even more severe conditions.

As mentioned, the FIRE movement is counterproductive to maintaining a holistic sense of well-being. There are more effective ways to control your spending while simultaneously caring for your whole self.

FIRE Promotes the Elimination of Credit Cards

Many promoters and adherents of FIRE generally denounce the use of credit cards for any reason. This is not realistic in today’s society. Credit cards are not only useful but they are necessary in some instances. Credit cards can make your life a lot more efficient on many levels.

While I don’t advocate debt accumulation, I do advocate responsible credit card usage for many reasons. Credit cards are great credit building tools when used properly. Credit card reward programs can save you money in many instances. Credit cards can also protect and defend you against financial fraud.

As with many FIRE proponents, I absolutely believe in spending only money that you have in most instances. However, this can easily be achieved with the use and implementation of a sound credit card plan of action.

FIRE SElls a FAUX Retirement Plan

The average person must have a six-figure income in order to comfortably retire early when implementing the FIRE method. Otherwise, early retirement generally looks a lot like life prior to retirement for the average person who uses the FIRE method.

This ultimately means living a very frugal lifestyle in which you are not able to spend on amenities. If you earn an average salary of about $50,000 you will have about $37,500 per year to live off of during your retirement years. And that’s if you are able to save at least 75% of your salary annually during your working years. Also, keep in mind that this money will need to last for the duration of your “retirement years”.

Of course, the figures above represent the average person who only puts their money in savings. These figures are not inclusive of compound interest earned from investments or other sources of income. Likewise this amount is for the average person who is able to save at least 75% of their income, which is typically an unrealistic feat. This means that a vast number of FIRE adherents won’t even be able to save this much each year.

In which case, many who embark on a FIRE journey end up quitting their full time job and making their side hustle or business their full time gig. This means that they are still effectively working.


Starting a financial independence journey is admirable in many regards. Doing so effectively helps to improve our lives on many levels. However, achieving financial freedom should never be an extreme or overwhelmingly painful endeavor. There will definitely be times on such a journey that require you forgo things that you may want but this should not be at the detriment to your overall health.

Saving and investing should be an intuitive and enjoyable process. Otherwise, it creates drudgery and resentment for the average person. In which case, one may give up altogether instead of investigating more sustainable ways to secure their financial future.

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Should I Be Debt-Free Before Starting My Business?

Debt and Entrepreneurship

I often get this question from my coaching clients who are starting a new business. Usually they are referring to revolving versus non-revolving debt. Revolving debt is the kind of debt that is associated with lines of credit issued to credit card holders. Non-revolving debt is associated with mortgages, vehicle and student loans, and other debt that involves fixed payment schedules.

I believe in entrepreneurship because I believe that this is one of the best ways to achieve financial independence and freedom. However, one of the first steps you should take toward financial freedom is to eliminate or decrease interest-bearing revolving debt. And if at all possible eliminate or decrease non-revolving debt – though this may be unrealistic for the average entrepreneur.

Reducing Revolving Debt

Your goal should be to eliminate revolving debt that you carry from month-by-month. This type of debt generates interest and fees that add more debt to your debt. It’s okay to maintain revolving debt as long as you pay it off in full by the due date each month. It is also best to maintain a 30% or lower credit utilization rate. In which case you don’t incur any interest and you are able to build your credit more efficiently.

However, anything beyond this will be a financial burden on you as you try to build your business. This is why I absolutely recommend starting a business free of revolving debt. You should also maintain a manageable amount of non-revolving debt. Doing so will take a great deal of stress off of you as start your new business venture. This way you can concentrate on building your business without the pressure to perform just to pay off debt.

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I recommend establishing business credit from the start of your business venture. However, I also recommend limiting the amount of money borrowed for business start-up. If you need to borrow money for your business be sure that you can pay off your debt in a timely manner. Only borrow what you can comfortably pay back each month and be strategic when making business purchases.

This is my general advice before starting any new venture that involves finances. Whether you are buying a new house or vehicle, or tying the knot, it is best to start with as clean a slate as possible. This way when unexpected expenses related to your new purchase or venture arise you won’t be caught completely off guard. So if at all possible, you should clear all interest-bearing revolving debt and as much non-revolving debt before starting your business.

Need more business coaching advice? Contact us and we will gladly assist you.

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