I prefer Financial Independence Work On Own Terms (FIWOOT) versus FIRE
We all know what FIRE is in the personal finance community but what is FIWOOT?
(I’ve updated this content from years ago, and then from 2019, to reflect my current views and progress.)
Read on and find out why I still prefer FIWOOT vs. FIRE and what that means moving forward in 2025.
Why the FIRE burns bright on social media
Like any good movement, it takes courage to do what others won’t.
Financial independence takes both know-how and long-term discipline. It takes time to remain invested when others are jumping in and out of the market. It also takes saving your brains out to retire early usually from a high salary and a bit of luck.
This is not to say I disagree with the Financial Independence, Retire Early (FIRE) movement and what some folks are striving for. I think many FIRE principles have great merit:
- Live well-below your means.
- Save early and often.
- Avoid financial and lifestyle waste.
- Avoid long-term debt that is not used for wealth generation.
- Optimize your investing (i.e., keep your costs low and diversified).
I’ve written about FIRE concepts many times on this site. Many years ago I even questioned if FIRE was right for me at all.
Well, I know my answer.
Why I’m tired of retire early in FIRE and why FIWOOT works
In some circles (not all thankfully), the focus of FIRE is on “retire early” part.
Work hard, make good money with the intention of leaving the corporate rat-race sooner than later.
That’s definitely aspirational – if that was the end of it. But most of the “retire early” crowd doesn’t retire. They still work just at something different.
If you expend energy, trade time or services for any income, that’s work. If that’s your blog or podcast or ebook or financial independence course that’s work.
And working is not a bad thing at any age. Just call it what it is.
Why I’m a fan of the Financial Independence (FI) part of FIRE
Maintaining your wealth and being happy doing it?
That sounds better and far more honest to me.
That’s the perspective that CFP Graeme Falco once shared on my site – when discussing his practical guide to financial independence book.
Like Graeme, I believe far more in the FI part of FIRE than the RE (retire early) part.
For me, financial independence is the amount wealth you need to be no longer dependent on any active source of income (i.e., work) to fund your lifestyle. That wealth could be from stocks, bonds, gold, real estate, and much more. Financial independence can also mean you might still want to work.
That’s something I intend to do in 2025 now I’m financially independent.
Financial Independence, Work On Own Terms (FIWOOT) Moving Forward
We realized financial independence in the summer of 2024 and since that date, I’ve been working on my employment status with my employer. I’ve been discussing the opportunity to scale-back a bit and work part-time in 2025. After months of fruitful discussions – that plan is now in place.
In early April, in a few short weeks, I will be working three days per week versus five. Full-time work with my current employer is over – I’m starting a new chapter with them and thankful for it. Unless both parties decide something different, I will be working part-time from April to October 2025. After that date, I might be retired for good.
Our semi-retirement years are here. More life-work balance is ahead this year.
Actually, in this new part-time capacity, I’ve finally caught up to my wife!
My wife continues to work three days per week in 2025 (she started her scaled-back role in 2024).
Moving forward, it’s part-time work for both of us in this 2025 transition year.
FIWOOT Q&A:
Will this change how I invest?
Nope.
As subscribers to this site may know for well over a decade now, we invest this way and have no plans to change our hybrid investing strategy:
- We invest in many Canadian and a few U.S. dividend paying stocks.
- We invest in some low-cost ETFs for extra diversification to own thousands of stocks.
Will I start living off the portfolio in the latter part of 2025?
We might have to!
If both part-time jobs are done in October 2025, we’ll need some money to live from. That might mean tapping our portfolio later on in 2025 and ramping up our withdrawal strategy.
What is my withdrawal rate going to be? Will that be 4% touted as the safe withdrawal rate?
Our withdrawal rate in the early retirement years is likely going to be about 3%.
That withdrawal rate might start in the latter part of 2025 (like I mentioned above) or potentially in 2026 if we continue to work part-time at something. We shall see!
Recall “the 4% rule” is the percentage of your portfolio you can safely withdraw per year, assuming no catastrophic poor sequence of returns occur, that will allow you to keep your portfolio “safe” to withdraw from using a balanced stock/bond asset allocation. More specifically, in 1994, financial adviser William Bengen introduced the concept of the 4% rule – who found that retirees who withdrew 4% of their retirement portfolio balance, and then adjusted that dollar amount for inflation each year thereafter, would create a paycheck that lasted for 30 years. This “rule” was stress tested using a range of withdrawal rates on differing portfolios of stocks and bonds using inflation data and investment returns from the mid-1990s going back to 1926.
I don’t subscribe to the 4% rule for any detailed retirement income planning myself but it remains a decent rule of thumb to jump off from.
Why I prefer Financial Independence Work On Own Terms (FIWOOT) versus FIRE
So, am I against the FIRE movement?
Heck no, but FIRE doesn’t work for me. FIWOOT does.
I’ve now reached a place in 2025 where I thought we might get almost 10 years ago.
Financial Independence, Work On Own Terms (FIWOOT) has started this year. It remains a FAR more accurate description of what I’ve been pursuing all along…
I look forward to keeping you updated on our personal finance journey as we enter this new lifestyle phase.
Mark
Notes:
- As far as I know, I founded the FIWOOT term back in 2017. So, you heard it there first, friends. 🙂
- I have no end-date in mind when I might stop working. That includes this blog. I hope to continue posting on this small labour of love for a few more years.
Congratulations Mark on this milestone! Well deserved and very inspirational. There’s nothing like taking control of your life and especially your time because like that say that’s something we can never get back.
All the best and keep us posted.
Very kind, Gus!!
Yes, absolutely, much more life-work balance now working 3-days per week. We are both very fortunate.
I’ll keep you posted on the coming year, might be fully retired this time next year!
Cheers,
Mark
Globe and Mail sent me here. And I definitely need to subscribe.
Subscribe away!
Cheers,
Mark
Congrats! Nice call out from Carrick on Money!
BTW, I stopped working officially last April and I’m loving it. I have many things keeping me busy. I don’t think I could have worked part time and do everything else. I had PT contracts in the past and it takes discipline to manage the hours so you are paid for your time.
Sandra, congrats!!
Are you drawing down that corporation a bit now? Getting rid of that tax liability like an RRSP?
Yes, Rob is quite kind to me over the years.
Part-time is not for everyone and it might not be for me long-term either but I enjoy my organization and want to help them deliver, just in a part-time way. 🙂
Congrats to you!
Mark
I completely understand. I was ready to retire and stuck around helping out the company I worked for because they asked me. That went on for about 2 more years. LOL. It was work I enjoyed and I liked the people so it was an easy decision to keep working.
I am drawing down the corp and RRSP to try to melt them down before taking CPP/OAS at age 70. It feels “wrong” to spend what we’ve saved for retirement and then rely on government programs later but the math works. We are also topping up TFSA and not spending this unless we really need to. That money will continue to grow and be there for a rainy day.
Super smart, Sandra re: “I am drawing down the corp and RRSP”….
If you can do that, then delay CPP + OAS to age 70 + have other incomes streams like a full TFSA eventually, as needed, etc. you are likely very much “set”.
I’ll update this post in the coming months for sure now that our workplace has signed off on our part-time roles for the coming months.
I anticipate we could likely start full retirement (?) in 2026 but we’ll see?
This is our budget/spending plan which includes no TFSA withdrawals for potentially another 20 years until we are into our 70s.
https://www.myownadvisor.ca/financial-independence-budget/
Mark
Not sure I’d call myself super smart but we are doing our best to come up with a more tax efficient strategy and this seems to be the best one! It’s amazing how your time fills up when you aren’t working. I’m still always busy – there is always something else to do!
Well, smart enough to know for sure that Corps. = RRSPs in similar ways in that these are tax liabilities and best to get the $$ out in retirement, early, vs. waiting until it’s too late.
Yes, I hope to be very busy in semi-retirement. Should be fun!
Congratulations, Mark, on reaching this incredible milestone! You’ve been an inspiration to many, including myself.
When I realized we had achieved financial independence, my enthusiasm for work rapidly began to wane. I found it increasingly challenging to maintain my productivity and project my outward “can-do” attitude. Emotionally, it was draining. I choose to go cold turkey. One day, I was working, the next, I wasn’t. I did bring home three box files full of papers, which took me several months to sort through and mostly shred. Once I’d finished that task, I really settled into retirement mode. No regrets!
Your slower transition, will hopefully result in you sorting our all your paperwork before you get to walk out that door for the last time.
Bob, very kind. I appreciate that!
I still have a “can do” attitude but I have found, over time, my energy being diverted to other things in life to be honest and not enough time for those. I feel I remain very productive and effective in my role but I also don’t want to be “on” 5 days a week – rather, the ability to dial back a bit on my own terms.
I could see for some roles and positions depending on the workplace, things could be very emotionally draining. I see it in a few colleagues at work. Unfortunate. Burnout happens and it occcured with some colleagues during COVID and happy they took the time they needed.
In my early 50s now, I want to prioritize my time more including some more fitness, some more community involvement and some time with family to be honest while I am still lucky and fortunate to have both of my parents around. Life is short. I could have more money in the coming years – working more. But I’m not convinced that is what I really need or want.
I look forward to sorting my “paperwork” in a metaphorical way. 🙂
I appreciate you sharing your journey.
Mark
Well done Mark! Good to see your plans coming together. And great timing! Work on your handicap this summer!
Congrats
Chuck
Ha, thanks Chuck. If I can be a solid 5-handicap I will be happy. I think I have a good chance at that. 🙂
Mark
Congratulations Mark on taking that next step in your FIWOOT journey! As I was approaching 60, I also had considered a “transition” to retirement with a part-time phase before full-on retirement. However, I never did pull the trigger and then I was fortunate enough to get offered an early retirement package three months before my 60th birthday – that made my decision easy! 😉 Anyway, I’m very happy for you and wish you all the best in this transition phase and beyond. There is one thing I would caution you about (based on what I learned from other people that also did the “part-time thing). Just make sure your “part-time” gig truly stays as a “part-time” gig! It’s sometimes difficult for hard-working people to “turn it off” when it comes to their job – so the 3 days creeps into 3.5, then 4, then maybe 5 some weeks depending on how busy things are getting. I recall talking to someone who moved to “3 days” but then felt like some weeks they weren’t “turning work off” and it would end up being more – then they complained – “gee, if I knew it would be like this I would have just stayed at 5 days full-time – at least I was getting 100% of my salary vs 60%”! Anyway, I’m confident you won’t fall in that trap – it takes discipline and you’ve clearly show you have that – especially when it came to your investment journey! I just wanted to mention it in case others consider that route. Looking forward to hearing more about this next exciting phase!
Yes, I recall “the package” for you!
I wouldn’t have that chance now but all good and I would like to consider staying with my employer beyond the next six months but we’ll see.
I appreciate the kind words!!
Yes, I will be monitoring my hours and ensuring part-time hours are just that, I will do as much as I can of course 3-days per week but avoid making it 4 and such. It’s a two-way partnership and my employer has been very good about this with me.
I appreciate the caution. My wife is currently part-time but there are times whereby it feels at least four days per week now and then (not often) vs. three but she has a great relationship with her manager and works out those extra hours worked as part of time in lieu, etc.
I look forward to sharing this next chapter – see what is possible back to all readers!
Mark
Congrats Mark! We’ll see you on the golf course in Hilton head soon!
That would be amazing! 🙂
All my best Dave, thanks for the kind words. Part-time here we come.
Mark
Your points re work and life are salient and valuable, thanks for your honesty and encouragement. I retired from a first responder career where part-time is impossible and finding new work of the correct type is not easy. I agree with all your points but this quest is a on-going challenge. Keep up the good work!!
Thanks, Greg. 🙂
I will keep you posted how things go and I hope you share some updates as well. I can appreciate your former career was both rewarding and stressful too!
Mark
Hi Mark
Thanks for the post and your updates.
Are you aware of any alternatives to CASH, the CAD high interest ETF and also similar ones to hold USD to park a few non-reg & corporate funds temporarily?
Thanks
Rick
Hi Rick,
Great question.
FWIW, I currently have some CBIL in my LIRA, held since that product came to market for cash equivalents there since I will be tapping LIRA to LIF in a few years – want the cash equivalents ready there.
I/we also have some money market funds as our low-cost cash equivalents in our RRSPs. Will be tapping RRSPs as early as 2026.
Non-Reg., there are a few choices.
We use a high interest savings account (HISA) for our emergency fund along with our daily chequing account.
https://www.ratehub.ca/savings-accounts/accounts/high-interest
We also have an interest savings account (ISA) for our non-reg. as well.
I like the Cash ETFs, CBIL, CASH, etc. in the registered accounts:
https://www.moneysense.ca/save/investing/best-cash-alternative-etfs/
I like the simple HISA/ISA for non-reg.
My corporation funds remain largely in cash but a GIC is maturing soon on that – I will be drawing down my corp. with RRSP in the coming years.
I see the Corp like an RRSP for the most part – mostly inaccessible until you decide to pay yourself a salary or a dividend. I only put the $$ inside a GIC since I wanted to keep ahead of inflation earning 4%+ vs. inflation at 2-3%.
I believe any money needed in 1-2 years should be in cash/cash equivalents but your mileage may vary of course.
I hope that helps?
Mark
I should add, Rick, there is also CBIL.U for USD $$, HISU.U and a few others for the USD $$ component; others to choose from as well.
Mark
Glad to see that you’ve finally pulled the proverbial plug Mark. Good on you for doing a mutual Segway with your employer and always having a backup plan if you happen to need it. I enjoy reading this site and the comments from other seasoned investors as well. I pulled the FIWOOT plug 9.5 years ago and am already set to do the RE portion come May. I look forward to watching and learning as you move through your next phase…good luck sir!
Thanks very much, Lou!
Yes, my employer has been very good to me with this approach/transition and thankful for the opportunity to work part-time while contributing.
I look forward to more comments and sharing with you on the site.
Keep me posted about your RE May date.
Mark
Congratulations Mark, I’m very happy for you! Enjoy the next chapter and what a great transition! All my best.
Thanks very much, Nachelle!
I look forward to seeing what’s next and having a bit more life-work balance; putting the former as a priority for me.
I look forward to hearing about your progress as well!
Mark
FIWOOT for me means working part-time (a few hours a day, a few hours a week) during the school year and having school holidays off entirely (including summer and Christmas break). Working on projects I like with clients I respect can be a good break from the day-to-day of homemaking and parenting. I just don’t want to be tied to it 8 hours a day, 250 days a year! 🙂
Great stuff Kim and you seem to be in a financial place where you can work on your own terms.
I don’t blame you for not wanting to work >8 hours per day ~ 250 days per year.
From what I know of you, you’ve certainly earned your FIWOOT!
Stay in touch!
Mark
Love reading your comments section, agree wholeheartedly. I like the term FIWOOT. The humblebragging is kind of annoying but I guess it’s a way of marketing to the masses to buy books etc. That being said, I’m not the IRP either, people can do what they want to do, but I guess the main thing is be transparent about it. If the blog income is helping provide security and cash flow for the investment portfolio and continued early retirement, maybe readers should know about that.
Indeed. I mean, is my blog, your blog, others, likely making some income? Yes. Mine is helping my journey for sure (not by a lot mind you) but I wouldn’t claim to be fully retired and running a blog that supplements my “retired” lifestyle. That makes no sense to me but to each their own!
All the best GYM.
Mark
good article Mark, I agree with you that many of the FIRE blogging crowd play fast and loose with the definition of “work” and “retirement”.
When I commented on one of the more strident blogs I was denounced as part of the Internet Retirement Police 🙂 ,accused of living in a small unventilated dump and having no life because my comments were not 100% in line with their POV and praising the bloggers.
So be careful when pointing out the obvious!
What concerns me is the inability of their acolytes to see anything save the mantra – a lot of Koolaid ™ going down.
btw the bloggers are the ones claiming to be Canada’s youngest retirees – and have been for several years – seems time keeping is also very fluid.
Ah yes, the famous or infamous IRP 🙂
I think my post was really to try and enlighten folks that drank the proverbial Koolaid ™.
I’m all for FI but please don’t call yourself retired if you’re out there selling or marketing your online empire 🙂
Some good points.
Man, I missed my opportunity to brand Financial Samurai as a FIRE blog! Despite writing about financial independence since 2009, I diversified my topics into things I was interested in post work life. I didn’t want to incessantly talk about FIRE because that’s not what life is like after FIRE. Instead, you move forward and focus on doing things you like after e.g. travel, being a SAH parent, etc.
If you were me, would you recommend trying to more purposefully get on the FIRE train by writing more on the topic? I feel I have the credibility given I live off our investment income. Also, what about doing the things you mentioned in the post and focusing more on making money online? I’ve basically just written stuff I like to write all these years, and passed on writing a lot of affiliate review posts etc. But it feels like a no brainer to earn more money if one can.
Thanks,
Sam
Good to hear from you Sam. I’ve followed your site for a few years now. I didn’t want to incessantly talk about FIRE on my site when I knew I would never really retire – at least that’s the plan.
As for you, I think ultimately you need to decide on what your brand is (for the site) and be true to that. If that’s sponsored posts, that’s fine; that can certainly make money but I know for this site it’s not my direction.
All the best in San Fran.
Mark
You might have a change of plan if you do retire. It is hard to resist shouting from the roof top how FIRed you are. But I think for most normal people, they move on and live life. But I have noticed that if you do not have enough investment income to cover your desired living expenses, then it’s logical for folks to do a lot of hustling to make money.
I have no problem with the hustling-folks or those that enjoy the gig-economy – that’s great if that is their choice but it’s a bit of a sham if folks say they are “retired” and 1) still work many hours per week for income and then potentially on top of that b) they market themselves as “retired” while relying on blog ad income, affiliates, royalties, etc. to fund their lifestyle.
It’s about telling the truth regardless how much income or not you make – that’s largely my issue. Just me. Integrity in life is important but I know some folks don’t share those values and that’s fine. All good. The world will continue to churn!
Hopefully in a few years we’ll have reached our dividend income goals/portfolio goals and if I decide to work (and I will, I like being busy and productive) then I can simply work more on my own terms.
Nothing wrong with that either as long as I’m making some valuable contributions to society.
Cheers Sam.
Mark
“it’s a bit of a sham if folks say they are “retired” and 1) still work many hours per week for income and then potentially on top of that b) they market themselves as “retired” while relying on blog ad income, affiliates, royalties, etc. to fund their lifestyle.”
If someone in “the movement” could coin a catchy acronym that’s better than FIRE, the problem would be solved. But so far, no one has.
You’re probably right Larry 🙂
I have a real problem with the “FIRE movement”. Blog technology being what it is, it allows anyone who is persistent and obnoxious enough to be a self appointed leader of “the movement”. With the ability to shout down or outright censor discussion or commentary that doesn’t toe the party line. They’re the ones who demand to use the word “retired” (which already has a clear and generally understood meaning) when they’re obviously not. I’ve written many times what you wrote here – they changed careers to blogging and writing. There’s nothing wrong with that. But just don’t use the word “retired”, which we all know to mean not working at all, and not planning to return to work.
Well put Larry. I’m a fan of some FIRE blogs – they are pretty clear they make money off their blogs and books and videos are more. Others, ugh, not so much transparency whatsoever.
Good article Mark. I, too, give little credit to the hype often surrounding the FIRE movement. I aspired and have achieved early FI.
I would turn “If folks want to pursue extreme frugality, that’s fine, it has benefits as long as one doesn’t hurt their mental or physical well-being because of it.” around and say:
Start by being mindful of the big picture and draw a soft plan for now and the future, including retirement that is consistent with your mental and physical well being in all of those years. In the end, in our own ways that’s what we all aim for: happiness. In FI, FIRE or whichever other method are not consistent with it, they are not worthwhile (you could say delusional, as likely just resulting from greed).
I like the concept and dream of FIRE. I’ve told my kids how I wish I’d known about the basic principles of achieving FIRE. I do want them to follow many of them; budgeting, saving, low cost diversified investments, avoiding consumer debt, think before you buy, not paying bank fees, etc. The dream of FIRE has had a good impact on their lives. When they actually hit the 25x income level, they can then choose if the RE makes sense to them. I sell the FIRE concept to them as freedom to choose. I do point them to a few select FIRE blogs and, of course, this one, so they get a balanced view of their prospects.
Thanks for that Bob. I’d like to think my site is balanced but I am biased since I run it!
I too have my blind spots but I think on the whole, I’m striving for some increased financial, physical and mental balance with time. I feel I’m definitely getting there and this blog is a vehicle to share those thoughts and where I’m going. I appreciate your readership!
Like a lot of the other comments I too agree with the FI more than the RE. I love FIWOOT! Becoming work optional is definitely a goal I’m pursuing. Being able to live my best life on my own terms without having to work at a 9-5. Does that mean I won’t work – absolutely not. Just want to be more in control of my time.
I hear you Maria re: more control of my time. I think that’s a great goal and something I’m striving for, for sure!
All the best in your pursuit!
Way off topic but I see Mr Carrick makes a case for ZLB for some investors to consider. RB mentioned it a while ago. I haven’t gone with this one but I’ll take another look at it. Might be something that fits for me.
https://www.theglobeandmail.com/investing/markets/inside-the-market/article-how-retirees-can-hold-stocks-make-money-and-still-play-defence-in/
I’ve been a fan since it launched and I think Mr Seed knows that too. No cyclicals, good sector balance, good methodology. Nice outperformance vs. XIU or XIC since launch in ’11. At some point there will be a reversion to the mean….
For those without a globe sub. this is an excerpt from that piece.
“The implication here is that a retiree would do better with a portfolio of defensive stocks than with stocks or an ETF reflecting the S&P/TSX composite index or S&P 500. Fortunately, the ETF world has a tonne of options for focusing on low beta stocks. Check out the Canadian and U.S. equity installments of the Globe and Mail ETF Buyer’s Guide for mention of several of these funds.
One is the BMO Low Volatility Canadian Equity ETF (ZLB), which delivered an annualized return of 11.5 per cent over the five years to the end of June. The S&P/TSX composite index made just 4.7 per cent over that period.
Theoretically, low-volatility stocks should disappoint at times when the stock market is surging. But ZLB has actually done just a bit better than the index’s 16.2 per cent gain over the first half of 2019. Don’t count on low-volatility investments to keep up this pattern of providing less downside risk with equal or better upside. Low volatility stocks can be a good option for retirees, but they will at some point lag the more growth-oriented part of the stock market.
And, yes, they can lose money. Defensive stocks are sensitive to rising interest rates, not that this is an issue right now.”
— Rob Carrick
I think ZLB is a great product. I recently added it to my ETFs page and favourites:
https://www.myownadvisor.ca/etfs/
I like ZLB, (despite the higher MER) because although it contains interest-rate sensitive stocks it contains some of the “essential” companies we need (housing / offices to work in = REITs + housing energy / electricity = utilities). Throw in a handful of consumer discretionary stocks (groceries) and you’re good to go!
I just did a count. I own 10 of the top-25 in ZLB myself for dividend income. I own most of the top-20 in XIU as a comparison. Probably will never buy it for that reason since I’ve essentially built my own DIY/Defensive/Income machine. Using more VYM and HDV state-side is a different matter!
I own only 4 of the top 25 and 10 of the 46. What I like with ZLB is it has proven to be a superier growth machine since inception (my priority re total return), with decent income generation,and contains low beta (defensive stocks) which theoretically should be less volatile in the next downturn – and has many stocks which I tend not to own.
In hindsight this would have proven to be a winner had I kept it before building my own CDN stock portfolio with a high concentration of dividend payers/growers. Previously a split between VCE and ZLB. Lol, hindsight is always so easy but kind of useless.
I definitely don’t like the idea of changing again but there may be some way to incorporate this etf as my equity and CDN stock allocations rise as planned. We’ll see.
I don’t yet own WCN in this list and might buy it. It’s interlisted so I can buy some on the CDN side and journal it to the USD side. Low-vol stock and great capital grower as well.
As you know, high or modest dividend yield is not everything!
Looks like a good one -very low beta & growth. Dull basic business that isn’t going away anytime soon. Extremely expensive but that seems to be the case with a good chunk of these types of stocks.
Indeed, I think we’re both on the same page re the yield and the total picture.
Indeed. I wish we’d have a correction since WCN is pricey but not sure I want to wait another couple of years. Might limp in this fall.
I’d be looking at it for a non-reg account to throw occasional funds into. I don’t want the hassle of tracking a bunch of ACBs so a decent ETF will do just fine. I’ve been “contemplating” this for a few months now (I’m bad at procrastination). Probably time to get off my butt and actually do something. Maybe after harvest. 😉
ZLB should be rather tax-efficient based on the holdings Lloyd. Seems like a smart call after the harvest!
Just checked how many holdings in ZLB I already have elsewhere. I only have 2 of their top 10, and 9 of the total 46. Just for comparison, I have 6 of the top 10 in XIU and 15 of the total 62.
Think its a wise call for you Lloyd, based on what you’ve stated your priorities are and considering your current holdings. Its very tax efficient. I know I did some homework on that a while back.
Mark,
Another great post as usual.Another one to validate my financial direction. You state: “Financial independence takes know-how, it takes discipline to hone your financial behaviours;etc” Thanks to your educational blog, I’ve got the confidence to take control of my finances. Your readers comments have also provided valuable insight and helped me stay on track. It is a learning curve but if I can do it anyone can. Your blog helps me stay focused even when the markets are jumpy. Thank you.
If you were closer you’d be getting my pickles and raspberry jam preserves. :))
Boy that sounds great!
You’re welcome Bonnie but you do all the work! There will be correction coming, a major one likely (?), so be prepared and make sure you invest with cash + bonds + stocks aligned to your risk tolerance. I’ll try and do the same here.
Cheers!
Great article Mark. I don’t get worked up about the FIRE police. Each people has a different outlook as to what “retirement” looks like to them. My view is similar to yours. I intend to ramp down at some point (I’m 45) and pick and choose assignments in 5-7 years. I have a high paying, high stress job and don’t see doing this in my late 50’s. One of my approaches is to have a contingency in my retirement budget to adjust my spending based on market returns. For example, my yearly trip becomes a 1 week road trip to upstate New York instead of a 1 month trip to Europe when markets tank. In general, I currently place a high value on financial flexibility and that’s how I plan to approach retirement.
I’ll try not too KB. Kudos to you with your high paying (but unfortunately high stress) job – so clearly you have an exit plan. Smart.
I also hope to have a modest cash wedge and some part-time work in semi-retirement that will hopefully provide the odd luxury whereby the capital can deliver dividends and distributions to cover basic expenses. I figure our basic expenses will hover around $30k after-tax per year.
I might be going to NY state area myself next year. U.S. Open is there.
Congrats on having a plan – you’ve clearly thought some things through.
Great stuff Mark. You know I’m totally with you when it comes to the RE of FIRE. I’d rather focus on FI than RE.
You bet. FI = I understand. RE (retire early) when people still work but claim they don’t really work = I don’t understand (nor support really).
See you in a few weeks!
Great article Mark. I read some of the FIRE stuff for ideas. As a long time self directed investor I am always looking for ways to be more efficient. None of us know it all and the rules constantly change. Love to read others opinions but also want to think for myself. We are all on a slightly different path in our financial journey. Work is good. Slave work you hate is not. Do what you love if you can. My motto is FILE. Financially Independent Life Engaged. Have a great day everyone.
I too enjoy the opinions of others – even if I disagree with them 🙂 I think that’s ideal right? Do what you love in life if you can – as much as you can. FILE IT!
Perhaps it’s better stated at “FIDSIL” – Financially Independent Doing Stuff I Like. Not retired, but not doing the 9-5 grind, doing stuff you like to make some spending money (or more perhaps if you’re really successful…). As with almost everything in life, it’s about perspective – one persons “financially independent” is another persons “how can you possibly live on that little?”
I like that too…sounds like a comment above Robert. His motto is FILE = Financially Independent Life Engaged.
Good to hear from you and thanks for the social media follow. How is the investing coming along?
Mark
If any person is actually working, saving, reducing debt or doing anything else to achieve what they call Retire Early, good for them. If it’s all talk, than they just likely want to hear themselves dream about what will never happen, especially those with 170% debt over their current income.
Personally I’m always skeptical of anyone who spends more time talking than doing.
What I do wonder is if they realize how long retirement can be and what might happen 20, 30 or more years down the line. Look back 30 years and see what has changed and how much one would need to live on today on the old money.
No pennies earned from my blog, just free opinions that one can ignore.
“Personally I’m always skeptical of anyone who spends more time talking than doing.” Sage advice.
What I’ve never understood is if FIRE is so great, why the need to talk about it all the time and dedicate a whole blog to it. Why not just do it?If these blogs were all about the journey to FIRE, they’d immediately quit after achieving their goal.
There are a million things to do once you hit your retirement number, and some folks decide humblebragging about their lives on the internet is the most worthy use of their time? How is that any better than working?
I gotta stop. The whole FIRE culture gets me all riled up.
Good to hear from you Nelson. I hope your semi-retirement (?) is treating you and Vanessa well – I thought you were done with full-time work in a traditional sense yourself? On that note – are you still running any sites? I recall you ran Canadian Dividend Investing for a bit?
Anyhow, I have no problem with folks striving for FI in FIRE but the RE and claiming they are retired when they are working or they need their blog, books, videos other to make a living while they can themselves FI really bothers me. Just be more transparent is all I ask but I suspect that’s a losing battle to say the least.
Hello , What we did was to semi retire at ages 52 and 48 and use only 3/4 of our total interest off investments and both work part time to earn additional 20,000$ between us yearly . Life is laid back , lots of travel time and life is so short and we enjoy every day . We plan on working the part time gigs til 65 , the jobs have flexibility and low key . We enjoy your posts .
That sounds very close to our plan Arlene. I hope we can make age 50 (5 years for me) to do that!
https://www.myownadvisor.ca/dividends/
Thanks for the kind words about the site.
I guess you could call me semi-retired today. I just try to find opportunities that are interesting with people I enjoy working with. Thus usually means short-term projects or longer-term part-time employment. Basically I’m the poster boy of the gig economy.
My wife enjoys the structure of a regular job, so she has one of those.
The focus is on living my best life rather than talking about it, if that makes any sense.
I do update Canadian Dividend Investing periodically, but don’t hold your breath. It’s a low priority for me at this point.
Yep, makes sense – why all the talk when you can do it.
Hope you guys have a great summer,
Mark
Nice article Mark. I fully agree that the key part of FIRE is the FI, after that its a question of organizing your time to do what you want to do with your time. If that means Work On your Own Terms, then perfect.
It’s a question of a lifestyle choice.
Thanks for the article.
Nothing wrong with FI, and working, just don’t call yourself “retired” 🙂 I wish you well in your journey!
Hey Mark, what if ‘retired’ means different thing to those folks? Retiring from everyday drudgery of their career…. and they have moved on to another fun filled adventure for them, that happens to be giving them money. Why be so picky about their definition of retirement? And who says retired means just living off passive income?
So, by your definition, after retirement, If I grow roses in my garden and share with neighbors for free, then you are ok with me calling myself retired. IF they buy a dozen roses from me once in a while, you don’t want me to call myself retired. LOL
Fair points Kay. I think if you’re actively working for money, it’s working for sure.
Are you retired? Maybe and maybe not. There are absolutely shades of grey on that which is fine.
What I struggle with is millennials or GenXers who claim to be retired, financially free including from any corporate world they distaste, but who are not because they use blogs, books, and online revenue for their lifestyle. They are both working and not retired if they need that money to live from for the necessities of life. I hope that makes sense? 🙂
I have same definition of retirement as you, Mark.
Another thing I don’t like about FIRE is the extreme frugality. I want to live comfortably.
Also, I don’t like the motive for FIRE to be escaping the rat race. Come on, the society needs people to work to run. Contributing to the society is not rat race. If you don’t like your job, find a new one. This is a free society.
I really like the FI part just like you, Mark. Retire or not, FI reduces stress in life a lot. I am not really FI yet, but half there already makes me less worried.
If folks want to pursue extreme frugality, that’s fine, it has benefits as long as one doesn’t hurt their mental or physical well-being because of it.
FI will eventually absolutely reduce my stress and I think we’re getting there slowly.
Thanks for your comment May.
We have been kind of forced to be extremely frugal for a while. We came to Canada with me not working and going back to school and paying international tuition fee, and my husband with a very low income doing postdoc research. If I have to, I have no problem going back to that life style. But having enough money to live that life style and call myself retired? NO, not if I have to.
There are things in life enjoyable without requiring any money. But there are also things in life you cannot enjoy without money. My kids enjoy the free public swimming pool in summer, while they also enjoy the Disney world trip that cost me $10K. Disney world trip is definitely not mandatory for a kid growing up properly. But if we could afford it, why not? Why should I want to sacrifice that just in order to retire a couple months earlier?
Of course, that’s only me.
You seem to have a great balance for your family re: kids enjoy the free public swimming pool in summer but there is Disney to enjoy as well.
Ultimately everyone needs to decide what they want out of life – always tradeoffs to be had.
No need to “sacrifice” only to retire a couple of months earlier!
May, you have done extremely well for yourself and your family. Hats off for moving to a new country, making sacrifices, and doing so many things right that you’re way ahead of what the average Canadian is.
I agree with you on the FIRE extreme frugality. To me – crazy. And yes, there are lots of worthwhile things to do that cost nothing to very little. And there are also different things that are important to each of us. You work and save for those things. Nothing wrong at all with having or doing some expensive things if you can truly afford it. Avoiding that and retiring earlier, or avoiding that in retirement was never and isn’t my plan either.
Good article Mark. I, too, give little credit to the hype often surrounding the FIRE movement. I, aspired and have achieved early FI.
I reply to this post because there is a very important nuance in it. I would turn “If folks want to pursue extreme frugality, that’s fine, it has benefits as long as one doesn’t hurt their mental or physical well-being because of it.” around and say:
Start by being mindful of the big picture and draw a soft plan for now and the future, including retirement that is consistent with your mental and physical well being in all of those years. In the end, that’s what we aim for: happiness. In FI, FIRE or whichever other method are not consistent with it, they are not worthwhile (you could say delusional, as likely just resulting from greed).
“In the end, that’s what we aim for: happiness.” Agreed.
I would argue greed is not consistent with happiness = emotional or mental well-being. It certainly implies you’re taking advantage of others. Not good in my book!
Thanks for your comment.
You nailed it here Mark. I see it pretty much the same way the same way on many of the FIRE claims and putting the focus on FI and then doing what you want on your own terms.
My wife fully retired when I was 52. I had been working in a phase down (non management or owner) employment role for 2.5 years at that point. When she retired I went to p/t 3 days/wk. and 2.5 yrs later I fully retired. Those 2.5 years were my FIWOOT period. As time passed and the reality of not really needing to work I decided to pull the plug before my performance or customer service suffered in any way (worked in full pay for performance role and my employer tried really hard to get me to stay).
It was a great way to (likely) end my working career and 5+ years later no regrets. My former boss stays in touch periodically.
Pay for performance can be stressful and I think people that are only wired a certain way can do it so long – the ante is always “upped” on you.
I think if you can stop working, for good, with no regrets that is definitely a sign you’ve reached FI.
Thanks.
I worked for 34 years in pay for performance roles either for myself or someone else (basically all of my f/t working career). Yes, you were as good as your last week. A bum or a hero. lol. It definitely isn’t for everyone. Although it had it stresses I enjoyed it and was highly motivated by it. I wouldn’t have wanted anything else.
Good for motivation for sure!
Wow, 34 years in pay for performance roles, please accept my admire. I will not be able to handle that kind of stress. Great for you being able to do things you like both in working and in retirement.
Thanks. It was stressful but also rewarding. However many jobs have significant stress in a lot of different ways even if they don’t affect pay. I like to go 100%. I felt I was going to lose that so I stopped working altogether, even though my results and earnings were way above even when I worked f/t in the years before at that job.
I like having goals and being challenged. I expect many folks on here are the same.
I freely admit I’m a skeptic and cynic. Guilty. This whole FIRE issue is a load of crap. Most of these folks need to invoke FIRE so that they get exposure to hawk their book/site/blog/etc to earn more income to sustain their FIRE dream. Media picks up on it without a clear look at the picture thus becoming the venue for the exposure. Then there is a small number of these FIRE enthusiasts that either got bankrolled by family or did something lotteryish (I know that ain’t a word but I’m sure you get the drift) that can not be easily replicated by the average person. They put forth their “astuteness” as if it was anything other than blind luck thus perpetuating their own self delusion.
Sorry, I don’t buy the FIRE thing and I have a lot of disdain for the media folks that hype it. They above everyone else should know better.
Certainly the mainstream media loves their headlines too. It sells. It’s sexy.
When people go from “I had $60,000 in student loan debt and I now have a net worth of $500,000 in 3 years” – that’s completely unrealistic.
Everyone else should know better but many don’t!
Wow, was I ever grumpy yesterday! 🙂
Your comment was approved all the same 🙂
Great stuff Mark, there are some good messages within FIRE, but the movement needs a reality check. Well done.
Dale
Indeed. Thanks for the sharing on this one – I feel it’s important to call such nonsense out from time to time.