Re: FIRE
Posted: November 6th, 2016, 8:30 am
I plan on finding out what it means!ap8889 wrote:What are your FIRE plans?
![Laughing :lol:](./images/smilies/icon_lol.gif)
Itsallaguess
Shares, Investment and Personal Finance Discussion Forums
https://lemonfool.co.uk/
I plan on finding out what it means!ap8889 wrote:What are your FIRE plans?
Who isn't seeking financial independence?...those seeking Financial Independence to congregate!
Those not prepared to make sacrifices?kempiejon wrote:Financial Independence Retire Early.
Who isn't seeking financial independence?...those seeking Financial Independence to congregate!
Other than a few leftovers from earlier learnings (an active fund I can't sell without big taxes, a HYP which has served its purpose) I'm now all about globally diverse low expense asset classes, which are mainly in the form of ETF's from different product providers (Vanguard, iShares feature highly though) for risk reasons and which wherever possible are in tax efficient wrappers again from different providers (HL, TD, YouInvest feature highly). I then just buy the worst performing asset class and rebalance at preset trigger points. Year to date performance is +14% and since Brexit is circa +11%. Of course that's in £'s and if I measured in $'s I'd get a completely different answer.ap8889 wrote:Funnily enough my father and I were discussing our respective post Brexit portfolio performance: he has simple global etfs and was chuckling as he has spent about 2 minutes thinking about them, and is well ahead.
I on the other hand have spent hours analysing and agonising over individual shares and balance sheets. I have a mixed HYP with ITs portfolio and have largely flatlined and underperformed him by a wide margin.
The global diversification and currency diversification is very worthwhile. Curses....
Yes I can see that - potentially very dangerous, especially if you want to retire earlier AND are going to live longer. I've used 3-3.5% as a rule of thumb for my portfolio given that even if I do exhaust it completely, we'll have one DB pension that will (just I suspect) keep us fed, watered and housed and possibly 2 state pensions - which may or may not come to anything. All rough and ready guides more than anything as you can see. I'm OK with that given it'll be a little while before we need to decide what we'd like to do, and how much 'resource' we'll have to do it with. I think your assumption of 2-2.5% drawdawn is sensible, given you don't have that as a backstop. It's not as if you can't adjust it should you find you've more capital than you need. Better that than the alternative ..TheRIT wrote: - In the blogging world particularly I see a lot of people either FIRE'ing or planning to FIRE based on following the 4% Rule blindly which effectively means 25 times annual spending. My view is that is an incredibly dangerous assumption and people need to educate themselves on what the 4% Rule is before jumping in with both feet. For example it is US based with the US being one of the best performing global markets in history, it's based on a 30 year retirement with many FIRE'ees possibly being retired for far longer than that, etc
Indeed. This definitely needs fixing, but I'm left wondering whether now is the best time to get started on it with the £ being the lowest it's been since whenever it was. And then where to put it? The US doesn't look so appealing (I have been saying that for at least 3 years now..), Asia/Pacfic, Japan, Europe? I need a bullet to bite I suspect.ap8889 wrote: The global diversification and currency diversification is very worthwhile. Curses....
I struggle with this too. I reached FI about five years ago, and RE earlier this year. Followed a somewhat traditional route -- employee with stable salary throughout -- but with a decade working abroad plus a lucky bit of a leg-up from stock options. I'm now of the opinion that RE for me personally is 'not working for money'.TheRIT wrote:I'm starting to see more and more bloggers who talk about FIRE but in the context of a concept where 'work' overlaps with 'life' because it's not 9 to 5, not 40 hours per work and is something that is 'part of the person'. I'm yet to form an opinion on whether this is FIRE as I don't want to be a Unicorn, Victim or Aggressive. I'd therefore value others views on this.
I (myself) struggle with the Gig Economy idea. I don't see what my USP would be in the young mans industry I'm in - I.T. Perhaps contacts, perhaps reputation, but there will always be someone smarter, quicker and cheaper than me. I can't help seeing it as anything other than a race to the bottom. Definitely not something I'd want to rely on.TedSwippet wrote:[interesting stuff snipped out for clarity]TheRIT wrote:I'm starting to see more and more bloggers who talk about FIRE but in the context of a concept where 'work' overlaps with 'life' because it's not 9 to 5, not 40 hours per work and is something that is 'part of the person'. I'm yet to form an opinion on whether this is FIRE as I don't want to be a Unicorn, Victim or Aggressive. I'd therefore value others views on this.
Now that I've learned this, I can see the benefits of the 'gig economy' for those a generation or so behind me. Work when funds are low, and take off and live life fully in between (zero-hours contracts are both blessing and curse, then) makes complete sense. On that model, 'retirement' defined as 'not working' is completely outmoded. The danger of course is how to function if/when one becomes completely unable to work. Some individuals are probably already there, but not the bulk. For society as a whole that problem is perhaps around half a generation away.
Yeah, I think gig economy works best if your gig requires physical proximity, some close cultural connection, an extremely particular skill set, or similar. If it doesn't, or if you lack these, it might be a struggle. From what I can see one would need some seriously niche IT skills to compete at topcoder.com. I have 35 years of IT behind me, and yet like you I would probably run screaming from this.MrDoppleGanger wrote:I (myself) struggle with the Gig Economy idea. I don't see what my USP would be in the young mans industry I'm in - I.T. Perhaps contacts, perhaps reputation, but there will always be someone smarter, quicker and cheaper than me. I can't help seeing it as anything other than a race to the bottom. Definitely not something I'd want to rely on.
This is going to be the interesting bit in FIRE for me. If worst case events occur then we live the intentional life planned. If average or best case occurs then average capital over the subsequent cycles is going to grow allowing a potential increase in spending. The interesting bit will be do we ramp our standard of living (given our approach is based on quality of life) or is a fairly large inheritance going to appear. I'd hope it's the later and we can stay intentional but I've very conscious we're also human.MrDoppleGanger wrote:... It's not as if you can't adjust it should you find you've more capital than you need. Better that than the alternative ..
Great post. In the world of work today at the grand old age of 44 I'm probably getting towards old timer status plus am probably a bit stuck in my ways. My aim though going forwards is to try and understand it as I might be able to use some of it myself. Even if I can't I can at least better understand others views.TedSwippet wrote:I struggle with this too. I reached FI about five years ago, and RE earlier this year. Followed a somewhat traditional route -- employee with stable salary throughout -- but with a decade working abroad plus a lucky bit of a leg-up from stock options. I'm now of the opinion that RE for me personally is 'not working for money'.
...
For my the big problem I saw was cheaper, more competitive and in a different less acceptable to me country. It's one of the reasons I chose the FIRE as a back-up.MrDoppleGanger wrote:I (myself) struggle with the Gig Economy idea. I don't see what my USP would be in the young mans industry I'm in - I.T. Perhaps contacts, perhaps reputation, but there will always be someone smarter, quicker and cheaper than me. I can't help seeing it as anything other than a race to the bottom. Definitely not something I'd want to rely on.
I see this comment a lot regarding the 4% rule being based on US research and I'm also aware of the follow on research which looks at safe withdrawal rates for a number of other countries including the UK which suggests that the safe withdrawal rate is much lower than 4%. With the advent of Pension Freedoms I can see that these boards will be an extremely useful source of debate around this in the years to come.TheRIT wrote:On the topic of plans a few top level thoughts:
- In the blogging world particularly I see a lot of people either FIRE'ing or planning to FIRE based on following the 4% Rule blindly which effectively means 25 times annual spending. My view is that is an incredibly dangerous assumption and people need to educate themselves on what the 4% Rule is before jumping in with both feet. For example it is US based with the US being one of the best performing global markets in history, it's based on a 30 year retirement with many FIRE'ees possibly being retired for far longer than that, etc
I would call that the FI part more than the RE one. That's probably just me splitting hairs, though...!TheRIT wrote:... my definition of RE is similar but subtly different to yours. For me personally it's work is optional.
I wonder if FIRE is more popular among IT workers in particular than the populace in general? And if it is, whether that's because this profession is now much more rife with 'ageism' (for want of a better term) than others?TheRIT wrote:For my the big problem I saw was cheaper, more competitive and in a different less acceptable to me country. It's one of the reasons I chose the FIRE as a back-up.
I agree with both definitions, i.e. "not working for money" and also "work is optional". My concern is about what follows, i.e. purpose.TheRIT wrote:Great post. In the world of work today at the grand old age of 44 I'm probably getting towards old timer status plus am probably a bit stuck in my ways. My aim though going forwards is to try and understand it as I might be able to use some of it myself. Even if I can't I can at least better understand others views.TedSwippet wrote:I struggle with this too. I reached FI about five years ago, and RE earlier this year. Followed a somewhat traditional route -- employee with stable salary throughout -- but with a decade working abroad plus a lucky bit of a leg-up from stock options. I'm now of the opinion that RE for me personally is 'not working for money'.
...
In the interests of full disclosure from where I sit today my definition of RE is similar but subtly different to yours. For me personally it's work is optional.
1. Physiological - breathing, food, water, sex, sleep, homoeostasis, excretion (sorry) - checktieresias wrote: I agree with both definitions, i.e. "not working for money" and also "work is optional". My concern is about what follows, i.e. purpose.
Are you by any chance author of a blog, and wicao in another place?TheRIT wrote:My plans are pretty well documented but for completeness: