FIRE. FFLC. DINK. I recently stumbled onto the online community of financially independent thinkers and early retirees. It’s been great reading the perspectives of others, but it took some time to become acclimated to the acronyms that kept appearing. Every group has its specific vernacular and unique lingo, and this one is no different.
It’s natural to classify one’s self in terms of a new-found cadre of like-minded folk. After perusing the list of terms from this awesome blog post, it became obvious that I’m a FIOR (Financial Independence Optional Retirement). That’s because my standard response to the question of “when will I retire” has always been “never.”
Why? I’m firmly entrenched in my chosen vocation and quite simply, I love what I do. That said, I’m quite sure that I won’t always spend swaths of my time on work/fun. But for me, the FIOR definition is about the freedom to choose.
Of course, the freedom that we seek doesn’t just come without time and planning (unless we’re fortunate enough to be the recipient a trust fund). For many of us, financial independence and the option to retire early comes from hard work, focus, and sacrifices made earlier in life.
As you look back on your journey to financial independence and/or early retirement, perhaps you can identify moments going all the way back to childhood that helped define the choices you made.
For me, it all started with a hamburger.
Save the Best for Last
As a teenager, I can vividly remember the moment when I not only understood, but communicated the idea of delayed gratification. My cousin and I were eating hamburgers from our local greasy spoon fast food stand when he commented on my consumption style. You see, instead of eating the hamburger from front to back, I always carefully ate around the circumference of the burger until I had successfully isolated the succulent middle, then slowly devoured that last piece in bliss.
“Why do you eat your hamburger that way,” he asked.
I replied confidently, “I save the best for last.”
This peculiar method of eating a hamburger was the product of a rather sensical observation from my youth: the strongest concentration of the various condiments and ingredients were typically in the center, while less was available around the edges. I reasoned that I could either plow through and get to the middle quicker, or I could eat around the middle, and save the juiciest, tastiest part for the very end.
Over the years, I have reflected on this rather odd habit that seemed to come naturally to me, and concluded that it was my way of instituting delayed gratification: suffer through the more mundane to obtain something more concentrated and intense at the end.
This idea was the subject of the Stanford marshmallow experiment which took place in the 1960s and 70s. This series of studies examined delayed gratification in children and found that those who waited for the larger reward instead of the more immediate one went on to perform better in life.
The work to gain financial independence takes a similar path.
Fighting the desire to revel in the immediacy of life takes discipline and courage. Everywhere there are distractions that call out to you like carnival barkers, tempting you to spend your money on everything from the quaint to the frivolous.
Don’t listen to them. The best things come to those who wait.
Temperance Is A Virtue
Moderation is an empowering word. It gives us license to partake in activities that bring us pleasure, while at the same time guarding us against the dangers of excess. For many, the art of applying moderation to everyday life is a learned trait that can take years to refine and master.
Nothing embodies temperance more than appetite and self-control. As a child, my metabolism was off the charts. I could eat anything (and I mean anything) without worrying about the ramifications of weight gain. Now, it’s a different story.
Holding the cheese on that hamburger definitely has upside.
In short, I learned to apply temperance and moderation.
The opposite ends of the moderation spectrum are gluttony and deprivation. Neither is good for long-term health, both physically and financially.
Financial gluttony can lead to spending our future for the present. The end result is acquiring a litany of “things” that weigh us down. These acquisitions, in turn, require even more resources to maintain. While the short-term hunger of the now is satisfied, it’s the long-term goals that suffer.
Conversely, total deprivation of the things in life that bring joy and happiness may work to swell our coffers quicker, but will ultimately leave one empty and hollow inside. If you happen to be the frugal miser who revels in the challenge of stretching each and every penny to its breaking point, then your next-door neighbor is minimalism.
My suggestion: move beyond the minimalist mentality and give yourself permission to enjoy some of what you’ve earned and saved.
Find that happy middle.
There’s a lot of room in the median where you can experiment and find the place that’s right for you to enjoy life while still being true to your financial goals.
Time is Your Most Valuable Resource
My great-grandfather used to say “buy land — they’re not making any more of it.” That piece of wisdom also applies to time which, like land is a precious and finite resource. There’s only so much of it to spread around.
We’re all here for some fixed amount of time, and the farther along you are in life, the less time you have going forward. Like any other resource, your time’s value increases as you age, because it becomes scarcer. When you’re 15 and flipping burgers or mowing lawns, your time is worth scarcely above minimum wage.
When you’re 45 and have acquired decades of experience in your profession, your time is worth much, much more.
It also helps to look at the value of your time in more than just in terms of monetary potential. Time spent with your spouse, children, or grandchildren also has immense value. Living the FIRE life gives you more of that precious time to spend as you please, with the ones you want to spend it with.
And honestly, the value of that can be incalculable.
Don’t Be Stingy
One mistake that some people make when working toward the FIRE lifestyle is to turn completely inward and focus stringently on saving and investing, to the exclusion of other rewarding and benefiting endeavors.
It’s understandable why we can fall into this trap. Generosity can be viewed by some as a weakness. The fear of being taken advantage of can be palpable enough to create an atmosphere of extreme self-preservation. Beyond that, it’s natural for us to keep our chicks in our roost. However, there is ample evidence that people who are generous are happier.
Of course, it’s not just about giving money — you can volunteer your time as well.
There’s nothing quite as rewarding like donating some time to your favorite local charity or cause, especially when you can parlay your passion into it. If you love to cook, then volunteer to teach a class at your local community center. If you enjoy playing music, visit your local retirement home and entertain the residents. You’ll be amazed just how fulfilling these givebacks can be.
Whether you’ve reached the FIRE lifestyle or are still on your journey, take time to give to those around you. Give the gift of your time, your pantry, or your wallet and effect positive change around you.
Believe In The Future
What’s the point of getting out of bed every morning if we don’t have some faith that today will be better than yesterday? There’s a lot to be said for a positive attitude and a smile on our faces as we encounter people throughout our daily routine.
Looking at life through such a lens equips us to be successful in our relationships and helps in attaining our financial goals and enjoying their fruits.
Sure, bad things happen. Markets fluctuate, natural disasters occur, people get sick… it’s easy to get caught up in the constant drumbeat of nasty negativism and think the sky is constantly about to fall.
Here’s a little secret: don’t watch the news.
What I mean is, don’t watch cable news.
Other than local news and weather, I have buffeted my positive attitude by simply avoiding any and all cable news. I know others who have done this, and it’s made an incredible difference in their day to day lives.
I’m not saying you shouldn’t stay informed, but there are ways to stay in the know about what’s going on in your community, country, and the world without the boob tube.
Optimism is not naiveté. You can still have an understanding of the pitfalls and perils of life, and still choose to look on the bright side.
Ignore the drudgery of the day’s news and the fickle nature of politicians and politics. Continue to stay positive and believe in the future.
You cannot find a better optimist (or a more successful one) than Warren Buffett, who summed it up succinctly in a letter to his Berkshire shareholders several years ago:
“For 240 years it’s been a terrible mistake to bet against America, and now is no time to start. America’s golden goose of commerce and innovation will continue to lay more and larger eggs. America’s social security promises will be honored and perhaps made more generous. And, yes, America’s kids will live far better than their parents did.”
That’s something to be positive about.
Give a man a hamburger…
Financial literacy is a learned skill requiring effective teaching and lots of practice. When I was in grade and high school, this wasn’t a life skill that was formally taught. I had to rely on my parents, who imparted those skills to me. It started with a savings account at 14 years of age and a checking account three years later.
Those tools gave me the foundation that I used to build my road to financial independence. And somehow I managed to stay away from the powerful but dangerous financial weapon: the credit card.
As a sophomore in college, I can recall the credit card applications and pamphlets spread across the clothed table in the student union, showering prospective cardholders with gifts and gimmicks for simply signing up.
I’ll never forget the older gentleman who was manning the booth. We struck up a conversation, and he told me point blank:
If you get one of these, pay it off in full every month. That’s the secret.
That bit of wisdom stuck with me.
The most dangerous form immediate gratification fulfillment comes by way of credit cards. They should be used as a tool for managing cash flow, not a carte blanche instrument for fulfilling the desire for immediacy.
One of the best things that you can do for those in your sphere of influence is to share your knowledge of saving and investing. You can do this both by example and by proactively sharing what brought you to financial independence.
Become a financial mentor to someone. There are plenty of opportunities to do so: setting up a workshop at your local library or partnering with a nearby school to give a talk at an assembly are just a few ideas.
Don’t just give them a hamburger. Teach them how to eat it.
Boisy is a FIOR and a hi-tech executive who chooses to continue working for the absolute fun of it. He’s also a fierce advocate for financial literacy and empowering people to take control of their future by exercising wise money management. His passion is to encourage individuals to discover their own unique path to financial independence and fulfillment.