Weekend Reading: FIRE In Moderation Edition
I write a lot about seeking financial independence rather than early retirement. That’s intentional. I don’t necessarily want to retire – not anytime soon – but what fires me up is the idea of working on my own terms.
My goal is to be financially free by age 45. That means I’d be free to ditch my day job and pursue my passion of helping people with their finances (through educational writing, financial planning, and hosting seminars or workshops). I wouldn’t be retired, since I’d still derive an income from these activities.
Many FIRE bloggers have the same idea – work hard, save a large percentage of their salary, and eventually ditch the cubicle life. The dream is to retire early, but more often than not their “work” turns into blogging, book writing, and speaking about early retirement.
Ironically, selling the dream of early retirement tends to be another full time pursuit. Just look at one of the original FIRE personalities, Canada’s self-professed youngest retiree Derek Foster. He’s written six books and runs a website where he sells his “portfolio picks”. He says “retired”, I say “quit his job to become a writer.”
To be clear, there’s nothing wrong with pursuing financial independence or wanting to retire early. Any movement that helps people spend less, save more, and strive for a happier life is to be celebrated.
The safe withdrawal math is easily ignored when the income needed to live is actually earned through blog revenue. The dirty secret of the FIRE blogger movement is they dont have to touch their investments while they’re out there selling the dream.
— Boomer and Echo (@BoomerandEcho) August 4, 2019
My caution to regular FIRE seeking folks is that if you intend to retire full-stop in your 30s or 40s you’ll need to have a massive amount of savings, an extremely conservative withdrawal rate, a commitment to lifelong frugality, and a plan ‘b’, ‘c’, and ‘d’ for when life throws its eventual curveballs.
Unlike your favourite FIRE blogger, you won’t have the luxury of supplementing your cash-flow with income earned online selling the dream.
I’m still striving for the FIRE blogger dream of quitting my job to blog part-time and pursue other activities. But when I do, I’ll call a spade a spade and not declare myself retired. How does FIE sound? Financially Independent Entrepreneur.
This Week’s Recap:
I managed just one post here this week, with a look at why actual investor returns are making GICs look good.
Over on Rewards Cards Canada I compared my accommodation experiences with Airbnb vs. Hotels.
And on Young & Thrifty I wrote about finding the best online mortgage lenders.
On another note, this blog is officially nine years old today!
Promo of the Week:
Speaking of Airbnb, the company has an awesome referral program that’s worth checking out. When you sign up for Airbnb with a referral link, you’ll get up to $62 off your first trip. How it works is you’ll get $45 off your home booking, and then another $17 to use towards an Airbnb experience worth $63 or more. An “experience” is an activity hosted be a local expert.
We’ve been using Airbnb since 2013. We love that we can get an entire place to ourselves for (typically) less than the cost of a hotel room.
Since we travel with kids, we often prefer to upgrade to a suite or adjoining rooms at a hotel – which can be costly. With an Airbnb, everyone gets their own bedroom, plus a living room, kitchen, and often more than one bathroom. For our upcoming trip to Italy, we rented an apartment in downtown Rome for $180/night, compared to the $350/night (starting at) rates at most decent hotel chains.
If you haven’t used Airbnb yet I highly recommend signing up and giving it a try for your next holiday or weekend away.
Weekend Reading:
My Own Advisor Mark Seed is on the same page as me when it comes to FIRE. He prefers, Financial Independence Work On Own Terms.
Martin Dasko at Studenomics started his own Airbnb “coffee crawl” experience in Toronto. Martin’s endeavours prove just how easy it is to make money online.
U.S. banking giant Chase made a brief appearance in Canada, handling the Sears portfolio of credit cards and introducing the first Amazon.ca Rewards Visa. Chase shut down its Canadian operations in 2017, but cardholders with outstanding balances continued to make payments. That is, until this week when Chase informed its remaining Canadian customers that it will wipe out any outstanding card debt.
Dale Roberts reports that Vanguard’s asset allocation ETFs have already gathered $1 billion in assets.
PWL Capital’s Justin Bender looks into the expected returns for the Vanguard asset allocation ETFs:
“In the face of eternal uncertainty about what the future has in store, the wise investor builds an efficient, globally diversified portfolio that reflects their personal long-term goals and reasonable expectations about what markets have to offer. Then they sit tight for the ride.”
Million Dollar Journey blogger Frugal Trader asks, can you have too much RRSP?
Finally, Ben Carlson at A Wealth of Common Sense says that victim blaming (the idea that your money woes are all self-inflicted) is the biggest lie in personal finance.
Have a great weekend, everyone!
FIRE > FIWOOT as far as acronyms go 🙂
I’m Team FI all the way Robb!
In reality, there are very few FIRE bloggers who agree with the RE part of FIRE. Most plan to continue working in some form post-FI.
FIRE just happens to be a catchy acronym that’s fun to use! Nearly all of us actually prefer Mark’s version of FI: FIWOOT.
There are many other acronyms that are more accurate than FIRE, but nothing’s nearly as catchy!
For me, I keep it simple and mostly use FI. 🙂
You’ve made some great points here. Always good to have different perspectives to consider.
Congrats on nine years by the way! I hope I’ll one day cross that milestone myself.
They should stop using the RE portion of Fire. Just call it FI. It’s become a status symbol with bragging right to self declare yourself retired. You then publicize it to the world, hoping to drum up traffic to your blog so you can ‘help’ others to also achieve ‘early retirement’ all the while hoping and praying they will click on the affiliate links and advertising they have filled their website with. You then spend every day writing blog post after blog post until you begin to (hope and pray) make money off the blog so you don’t have to actually begin to apply the 4% rule. All the while you’ve been working as hard if not harder than you were in your corporate job (which is simply called being an entrepreneur or small business owner) Its like me calling myself an athlete because I run 15 minutes a day. Actual athletes would not agree with me but then again I can call myself anything I want. Early retirees rarely are actually retired, they just enjoy the bragging right they get from calling themselves retired.
I honestly don’t get why anyone would book Airbnb. I’ve done it a few times and the experience has been less than stellar. Its also galls me that I have to pay the booking fee. Than there is the issue of cameras (allowed but not in the bathroom or bedroom – you hope), dirty bed sheets and the fact you have to try and meet the host at a predetermined time. No thanks.
I almost always book apartments when travelling (eating out not only gets expensive but it gets old fast). I simply search for furnished apartments or flats, most are companies that specialize in this and offer a better level of service with none of the Airbnb negatives
We use Airbnb all the time without any problems. You just need to do your homework to screen out the problem listings and read reviews, look at Google Street view to try and locate the area the apartment is in and good communication with the host. What website are you using? Please share as it’s nice to have some options.
I typically search apartments on booking.com and once I find one I like I look for the website. I find a lot of times that booking.com adds the fee so going direct can save quite a bit of money. I do check Airbnb but so far I’ve found Booking.com to be cheaper.
Part of it is I prefer dealing with a company that has a large amount of units. For example staying Dresden I found a really nice 1 bedroom place fantastic location. The company owned the a complete building so you had 24 hour check in etc.
Another alternative is to search for furnished apartments or self catering flats as the British call it.
Hi Rob, thanks for sharing your experience. Many of these apartments are also available on Airbnb. For example, our apartment in Inverness was managed by Mansley and included daily cleaning service. We still rented it on Airbnb from a Super Host.
Alternatively, I’ve rented a condo privately in Kelowna from a management company and had big problems at check in (they gave our condo to someone else and claimed to “upgrade us” to an inferior place) which took forever to sort out.
No such problems with more than a dozen Airbnb stays.
BTW it never occurred to me to ever use a airbnb referral link. While not a big fan there are times when I do use it!
Good tip
Perhaps this works for you Robb:
Financial Independence Resign Early”
It works for me as I truly don’t know what I’ll be doing next. Perhaps I’ll do some paid work, perhaps donate my time to help others in the community, or just do nothing at all except travel and take photos.