Financial Independence, Early Retirement and FIRE

FI = Financial Independence FI is pretty much everyone’s goal (I would think!).  FI means that you don’t have to work for money. Traditionally, FI was equivalent to “retirement.”  Retirement meaning you stopped working all together usually around the age of 65 or so. Think days at the golf course, river cruises in Europe, and a drink with a little umbrella in hand. Now, the definition of retirement is evolving and FI seems more fitting now since it includes the traditional definition and more. [caption id="attachment_1334" align="aligncenter" width="267"]Drink with little umbrella You’ve arrived.[/caption] RE = Retire Early RE is pretty self-explanatory. What counts as RE depends. In the non-physician world the famous RE folks are in their early 30s:

Early 30’s would be exceedingly difficult for a traditional physician who begins attending life at age 30. I guess you’d have to be a Dr. Doogie Howser to do that. Physician on Fire is almost there as he recently announced that he is going part-time at the age of 41. I think a physician who can “retire” at age 45-50 is considered RE. FIRE = Financial Independence, Retire Early FIRE is a special club. You’ve officially arrived if you’re a member. Not only can you not work for money if you don’t want to but you’ve attained this at an age much earlier than anyone else. This is a popular goal to strive for. FF = Financial Freedom Isn’t FF and FI the same thing? Maybe. If you’re a splitter (vs. a lumper) then FF is one step beyond FI. It’s FI + generous wiggle room. It’s a bit naive to think you know and can predict your expenses 20 or even 30 years into the future. Things may go as planned, but often, they do not. Your wants will most certainly change. Health care costs are nebulous and completely unpredictable. A health crisis can easily eat up several 100s of thousands of dollars for things like home health care or a long-term care facility. A family member may need help and maybe you’d like to be in a position to help them and not derail your goals either. Stay tuned for the second part of this post – how to determine your FI or FF number and more! What’s your FI number? Are you FI, RE, FF, or FIRE? Comment below!]]>

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7 Comments

  1. Carrie MD with the Hippocratic Hustle on July 2, 2017 at 10:12 am

    My husband recently started thinking about RE. Maybe by 55 if we can increase our income stream? As it is we are aiming for 62. The RE culture has really got us thinking though…



    • Miss Bonnie MD on July 3, 2017 at 10:41 am

      Right? Super motivating goal …



  2. Hatton1 on July 3, 2017 at 8:44 am

    I am in the FF crowd. Once I realized I was FI (25-33x spending) I began to slow down. At first leaving earlier in the day then working 3.5 days per week in the office. I made a big move at age 56 and quit OB and now just do Gyn 3 days per week. I just turned 60 so decisions, decisions.



    • Miss Bonnie MD on July 3, 2017 at 10:42 am

      Hatton1 – you’ve definitely arrived :). I think it is so awesome this allowed you to customize your work for the better. It’s really about the ability to have choices.



  3. Physician on FIRE on July 12, 2017 at 8:40 pm

    We’re somewhere between FI and FF, but barring a bear market in the near future (which could very well happen, of course), we could be there in the next year or two.

    Cheers!
    -PoF



    • Miss Bonnie MD on July 12, 2017 at 9:23 pm

      I’m sure you probably wrote about this, but are you keeping a nice cash reserve for that in case?



  4. […] started “late” (finished residency at age 38!) to all this. Yet, I am on my way to FI. So I hope my story can show other women that they can do it […]



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