On Personal Finance and FI/RE

Financial Independence for one and all

On Personal Finance and FI/RE

I recently came across FI/RE (Financial Independence/Retire Early) purely accidentally via HN.

This post documents the rise and fall of someone who pursued in succeeded in Early Retirement, but had some troubles later in life which made them take a job.

Now, not one to miss Schadenfreude (the joy of someone else's misfortune), I was reading the (expectedly) deriding comments on the post while trying to understand what FI/RE is all about.

P.S., my sympathies are indeed with the OP who didn't have it easy in life.

While learning FI/RE, I did a deep-dive into MMM, liveafi (the OP) and other material I could find online. Turns out theirs and my life philosophies matched a lot.

Early Retirement (acc to them) doesn't mean you stop working, it just means you pursue what you want in life.

Acc to my reading of 50+ articles, my takeaways were:

  1. Live life to the fullest
  2. Being mindful of where you spend your time and money (be careful what you're trading them for)
  3. Doing as much DIY as possible to maximize exercise.
  4. Have as little as an impact on the envt.

Throughout their articles, they also discuss a lot about finances and how you can keep your finances for a longer period of time, so you can reach a stable Retirement state early while being able to work/pursue wherever you want.

Here 2 keywords come into play:

  1. SWR (Safe Withdrawal Rate) - How much you can withdraw from your corpus/portfolio yearly without affecting your finances.
  2. FIRE Portfolio - The amount of money you need in total given a certain SWR and yearly expenses. It's calculated as FIRE Portfolio = (Yearly Expenses/SWR)

If you're in India, this is essential reading for this: https://www.reddit.com/r/FIREIndia/wiki/index#wiki_the_safe_withdrawal_rate_.28swr.29_strategy

The other 2 things they preach are:

  1. Treat Every Purchase in Life like you're getting it for Free
  2. Treat Every Work Opportunity like you're doing it for free

(This is after you reach your FIRE goal, but it's a good thinking exercise regardless.)

  1. If someone offers you a luxury car, apartment, are you willing to pay for the:
  • Property Taxes
  • Maintenance Costs, etc.

In most cases even if you got a luxury item for free it would be too expensive to maintain

  1. If you consider your job like a good friend asking a favor, would you still do it? This (might) put all the extra things around your job in perspective.
  • A 2-hour daily extra commute
  • 4-hour meetings throughout the day, etc.

Maybe you'd like to take back control somewhere.

Anyways, these were just the takeaways from the reading that I did. Some links:



Most important for Indians:

  1. https://reddit.com/r/FIREIndia/wiki/index#wiki_the_safe_withdrawal_rate_.28swr.29_strategy
  2. Read everything here: https://ankitkr0.in/2021/01/04/a-guide-to-personal-finance-for-21-year-olds/

Hopefully I help someone with this article :) If you like it, why not follow me on Twitter @thewritingdev