Opinion: Second-hand clothing, not owning a car, chopping wood to heat my house: Why the FIRE movement is too economical for me – MarketWatch
I regularly read blogs written by those who withdrew early to lead a life of extreme frugality. Are you careful with money? Even so, I doubt you would enjoy the frugal lifestyle of many of the FIRE (Financial Independence / Early Retirement) movement’s frugal lifestyles.
I certainly wouldn’t. If I go on another cruise, I won’t book an inside cabin. I can’t imagine my wife buying clothes from a thrift store and wearing them for the next 10 years. Things that seem too frugal to me: Never go out to eat. Never travel. Don’t own a car. Live on a secluded piece of land and chop firewood for heating. Pick up toys from the curb for the kids. Move to Mexico for the low cost of living.
And no, I don’t trust my glasses to an online service to save money. Don’t get me wrong: I avoid designer frames and design everything else. I tend to be thrifty. I avoid spontaneous purchases, buy the latest and buy unnecessary stuff. Still, you usually get what you pay for. Have you ever read about the things you should never buy in a dollar store?
But it’s not just the extreme thrift of the FIRE people that bothers me. Rather, it is also the associated claim to be financially independent.
Don’t get me wrong: I don’t mock these frugal people, and I’m not a snob. But understanding the lifestyle necessary to be financially independent when living on a tiny budget is important.
Of course, these people seem happy with their choices. Many are actually high-income bloggers, writers, and podcasters who are sought after by the media. So I’m jealous. Nobody comes to me. Being an old school dinosaur is no news.
One blogger claims to have lived on $ 7,000 a year or less for a decade. Another says his family of five lives on $ 40,000 a year and only spent $ 296 on groceries in March. The U.S. Department of Agriculture sets a low-cost grocery plan for a family of four at $ 892.90 per month. Even a frugal eating plan is valued at $ 676.80 per month.
The same family pays almost no health insurance premiums because they keep their incomes low enough to receive grants under the Affordable Care Act. In March, her net worth rose $ 68,000, ending the month at $ 2,648,000. The lesson: Since the state usually counts income but not wealth, some of the thrifty may qualify for subsidies and tax breaks.
One couple who retired 30 years ago at the age of 38 said: “At the end of 2020, we were spending $ 28,133, or $ 76.87 a day. We also screwed up the $ 2400.00 stimulus check for repairs at our humble US residence. Our average spend for 30 years of financial independence, or 10,950 days, is $ 23,241 per year or $ 63.67 per day. ”You live mainly in Mexico now, travel, and have lived all over the world. Honestly, all of this is beyond my understanding, but it seems to be working for them.
When I stopped working after a 50-year career, I retired. Now I’ve learned that retirement may not mean what I thought it would be. Some people claim to be retiring early after having simply given up their current job for something less demanding – a life of doing your own thing, so to speak, but not really stopping to work for an income. Does the $ 6.70 I make every month on my blog make me a hypocrite?
Every man for himself. But where would we be if everyone retired at 38?
This column originally appeared on Humble Dollar. It was republished with permission.