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Anonymous

12 Jul 2021

Retirement

How to FIRE as soon as possible, and when do you think it is possible?

Hi Seedly fam - I wanted to check how am I doing, and what is the community’s wisdom?

I am in late thirties, mortgage debt of 700k, no credit card debt, savings of 40k. I will be able to manage to save 2k-3k monthly after all expenses. I have 80k in OA and SA each. MA hit the 63k already. No major investments yet, no insurance except company provide. I plan to have one child within a year.

I recently learned about FIRE but still learning, so pls advice. How can I FIRE at the earliest?

Discussion (8)

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Agree with people's comments on this post, and adding on a few more things.

It depends on what age you want to FIRE - the earliest?

  • Increase your savings
  • Increase your income
  • Invest, and make sure your investments are working for you (but don't dump it all in the stock market, and hope it sky rockets,... that's a dangerous tactic, always remember to diversify)

To FIRE you'd also need to have a clear understanding of your spending and savings rate. I'd suggest getting a simple tracking app and logging in your expenses for at least a year to get a realistic sense of your expenses. Then reasses.

Increasing your savings rate is by far the most important aspect of FIRE-ing. If you can live a low-needs, low-cost life, you would be on your way to FIRE much quicker than someone who needs to splurge on the latest things. But it's a fine balance - you don't want to be too overly focused on FIRE and absolutely miserable in your experience of the present. Only you can decide what's worth it.

You say that you save $2-3k monthly after all expenses, but what is your savings rate, as a % of your salary? If it's 20%, you're going to be working for a much longer time than if it is closer to 50%.

It's also important to build in a margin for risk because retiring early means a longer time for variables that can knock you off course. And we can change - growth is vital and a part of life - it's dangerous to assume who / what we are now and the things we value now, will remain exactly the same in 10 or 20 years.

You might decide you want kids, your lifestyle wants/needs could change - this will all impact the age which you are able to FIRE.

Increasing your income - think about ways you can upskill and get raises, and guard against lifestyle creep.

Invest - start reading up on investing, and work on maintaining a simple but diversified portfolio. Many people do a mix of bonds, low cost broad based index funds and maybe REIT ETFs.

And finally echoing other comments it is absolutely vital to get at least some basic insurance.

Good luck!

My humble suggestion like what someone also mentioned here: get your own personal insurance first before you embark on any investment path. I am not suggesting your company insurance is poor or anything but it is better to construct your own safety net first.

U probably need to see if you are FIREing or both you and your wife are going to FIRE. If both of you have the same mindset, will be easier to work towards FIRE.

Some people still prefer to work and not FIRE, but be FI. Because after FIRE u might not have much to do, might as well work for fun.

Grow your income either from salary or from other means (side hustling)

And also reduce your expenses. If you going to have a kid, can consider hand-me-down goods to reduce the expenses. Also buy bigger size clothes coz baby will outgrow them very soon.

U can also search for the best miles /cashback credit card articles in seedly, like which one is good for pregnancy checkup,birth delivery etc.

FIRE have different meaning to different people so earliest to you is at what age? Let's put 2 assumptions; To be financially independent at late 50s would give you 20 years to save/invest to hit FIRE and consider also your sole/joint 700k mortgage.
Again, with all the well-wishes already presented, I would complement the need to rethink both protection needs and expenses projection (inflation/education adjusted) for at least 30 years in retirement.

I'm gonna advise differently here. You should prioritize your insurance first. Primary your hospital...

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