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Early retirement is growing momentum with FIRE movement

The FIRE movement

In an era marked by shifting career expectations, evolving financial landscapes and a renewed focus on life's purpose, the FIRE (financial independence, retire early) movement is experiencing a significant resurgence.

Traditionally, retirement has been synonymous with a gold watch and a pension plan at age 65, but for today's younger generations, the notion of early retirement is gaining momentum.

The FIRE movement emerged in the early 1990s, from the book Your Money or Your Life by Joe Dominguez and Vicki Robin, but has gained significant traction in recent years. It revolves around the idea of achieving financial independence as quickly as possible, allowing individuals to retire early and pursue their passions or simply enjoy life on their terms.

FIRE followers typically save a substantial portion of their income, practice frugal living and invest wisely to build a nest egg that can support their desired lifestyle without relying on traditional employment.

So, what is this movement and how does it work? Let’s break down the main components:

1. Financial security and freedom—One of the primary reasons for the resurgence of the FIRE movement is the desire for financial security and freedom among younger generations. Millennials and Gen Z have witnessed the challenges faced by their parents and grandparents, such as the uncertainties of traditional retirement plans and the burden of student loan debt. In response, they're seeking alternative paths to achieve financial independence and retire early to enjoy life on their own terms.

2. Work-Life balance and pursuing passions—Younger generations value work-life balance and are keen on pursuing their passions outside of the 9-to-5 grind. The FIRE movement aligns perfectly with this mindset, as it encourages individuals to prioritize personal fulfillment and spend their time on activities that genuinely matter to them, whether it's traveling, volunteering or starting a business.

3. Investment opportunities and financial education - Advancements in technology and increased access to financial education have empowered younger generations to take control of their finances and investments. Online platforms, robo-advisors, and investment apps have made it easier than ever to build a diversified investment portfolio. Younger people are leveraging these tools to grow their wealth and work toward early retirement goals.

4. Remote work and gig economy—The rise of remote work and the gig economy have expanded opportunities for earning income outside of traditional office jobs. Many younger individuals are capitalizing on this flexibility to supplement their savings and accelerate their path to financial independence. The ability to generate income on their own terms brings them closer to achieving FIRE goals.

5. Minimalism and sustainable living - Minimalism and sustainable living are trends that resonate with younger generations. FIRE aligns with these values by encouraging a minimalist lifestyle that focuses on essentials and avoids unnecessary expenses. By cutting back on materialism and wasteful spending, individuals pursuing FIRE can accelerate their savings rate and reduce their financial dependency on traditional employment.

6. Community and support—The FIRE movement has a thriving online community where like-minded individuals share their experiences, strategies, and support. Younger generations find inspiration and motivation in these communities, helping them stay on track with their FIRE goals. The sense of belonging and the ability to learn from others' experiences have fueled the movement's resurgence.

The resurgence of the FIRE movement among younger generations is a testament to their determination to take control of their financial futures and prioritize a life of fulfillment and purpose. By focusing on financial independence, early retirement, and the pursuit of passions, the FIRE movement offers a compelling alternative to the traditional retirement narrative.

While FIRE isn't without its challenges and sacrifices, it provides a roadmap for young people to escape the paycheck-to-paycheck cycle and achieve a future where they can choose how they spend their time and resources.

Whether it's through diligent saving, wise investments, or embracing minimalist lifestyles, the FIRE movement is reshaping the way younger generations approach their financial goals, offering a path to a brighter and more self-determined future.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

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About the Author

Brett has worked in the financial advice industry for over 15 years and is designated as a chartered investment manager(CIM) and certified financial planner (CFP).

In 2014, Brett was appointed to the board of directors of FP Canada (the national professional body for financial planning) and spent seven years on the board, including his final two as board chair. More recently, he was appointed to the Financial Planning Standards Board (FPSB), which is the international professional body for this industry with a three-year term beginning in April 2023.

Brett has been writing a weekly financial planning column since 2012 and provides his readers with easy-to-understand explanations of the complex financial challenges that they face in every stage of life.

Enhancing the financial literacy of Canadian consumers is a top priority of Brett’s and his ongoing efforts as a finance writer and on the regulatory side through the national and global boards focus on this initiative.   

Please let Brett know if you have any topics that you’d like him to cover in future columns or if you’d like a referral to a qualified CFP professional in your area by emailing him at [email protected].


The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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