Playing with FIRE

Its getting like the property spruikers. people get FIRE and then they start making huge amounts of money from it by teaching, running websites etc. Someone could just pretend they have reached the stage of FIRE and then make enough from the business side to actually reach the FIRE.

 

Website for these two "livin' the dream" is Millenial Revolution if anyone's interested.

 

This might be them
Millennial Revolution - Stop Working. Start Living.

 

Yep that's them.

 

Yep. Jump on the latest trend and hope you were in time to make money from it.

Like with anything too, you have to be careful about what is being taught. Their version of the "Yield Shield" has copped some pretty thorough criticism for example.

 

I have only occasionally read articles of this nature and haven't actually watched any vids all the way through (if I can be bothered to even look) as the cynical side of me thinks "Yeah right, so what are you selling?"

Hopefully some get at least a bit out of them which may be of use.

 

The cynical side of me thinks "How can someone so young amass enough capital to live off? Your income must be derived from telling others how to live off their investments, not actually doing it yourself."

Of course, I could be wrong......

 

I suppose the positive/naïve side of me says 'good on them'. I guess it's like most professions. Theoretically anyone can do anything. But we all need a push in the right direction. If this helps people make informed choices regarding their future then so be it. Many people follow Buffet and buy his books etc. If that assists someone to reach their financial goals then great. If someone thinks they'll follow in the exact same footsteps and earn the same as these 'educators' then they need a self-help blog. Not a financial one.

 

From memory they were both early 30's when they 'retired', both in IT earning very big salaries & continued to live frugally & invest. No kids, cars ,flash living premises or smashed avo's ,just stayed focused on the end game.But yes,now earning money on the side promoting how to do it.

 

If you could save $100k per year for 10 years that would give you $1mil and at 4% pa dividends that is about $40k which they are getting. To save $100k all you have to do is earn $200k and save half.

 

Not that hard for 2 IT people. Many on $200k pa

 

They won't be on 200k after tax?

 

True but the thought crossed my mind on how many working in the local fish and chip shop will ever reach FIRE - apart from the occasional burn.

 

According to ASIC compound calculator, if you invested $100,000 per year earning 4% re-invested,after 10 yrs. you'd have $1,200,611 -------- simple .

 

Thats why saving is the bedrock of wealth! If you can sock away 50% or more of your take home pay you can reach a good financial position due to having a high savings rate. Then apply a simple couple index funds and give it some time for the all important compounding to occur and there you have it!!! No need to chase huge returns or reply to Nigerian emails etc etc, just solid savings and basic index trackers and time.

 

If you have ever played Kiyosaki's Cashflow game (all the rage about 20 years ago) you would see that cleaners can generally retire faster than surgeons because of the lower expenses they have.
If it just a mathematical formula - I think there is a graph in the book Early Retirement Extreme which shows the greater the % of your salary you can save/invest compared to how quick it will take you to retire.

 

Have a watch of this brief talk by Mr Money Moustache

It shows his path to financial freedom, including that graph you mentioned.
But more importantly it helps to reshape the thinking of what is considered "enough".

Just remember that MMM is one of "those bloggers" that is now living the dream *because* of his blog. Earning something like $400k/yr from his website and other streams.

 

Great video. MMM is my main guru and I wouldn't be surprised that he is earning that much, and if so it would be well deserved.
Do you have a source for that?
Wonder what he does with it all.


This is one of the best explanations of FIRE that I have seen. Got the link via MMM's Twitter feed