Jonathan and I are on a path to fire because we want to live life on our own terms. We don’t want to be tied to any job or employer. We don’t want the stress of needing a job. Being stressed out at work sucks! We don’t want to deal with that anymore.
Our Path to Fire
If you recall from our article on the Fire Fundamentals (and you can read it here if you don’t!) I mentioned that there are four steps to getting on a path to fire. Step 1 is learning about Fire – I think I have that covered. Step 2 is deciding what you will be comfortable with. The third step is to make a plan for getting there, and the final step is to execute that plan.
What type of Fire will I be comfortable with?
I know we want to travel, so lean fire probably isn’t for us. But we also want to have a comfortable, secure traditional retirement (We absolutely don’t want to be in poverty when we are seniors!), so we need to at least get to Coast fire. We want to be financially independent as soon as possible, and we decided that we will probably need about 60K per year to be comfortable. We are also ok with working odds and ends types jobs, so I’d be totally comfortable with a barista fire type of lifestyle (financially independent, but taking an easy part time job to fill any holes that come up or for extra spending money).
How are we going to get there?
Sixty thousand dollars per year without working a full-time job seems pretty daunting. We need big gains and passive income! I got super lucky with real estate – and by getting lucky I mean I bought at a great time in a market that would only increase. My big gains could come from selling the house! But we also knew that meant we couldn’t stay in the crazy expensive metropolis of Los Angeles. We needed to find a new city in order to really capitalize on those real estate gains.
Passive income is the real key though, so we needed to figure out a way to generate income without working. Blogging and Investment funds for the win!
Executing the plan
The first step to executing the plan was selling the house in a high COL area and moving to a low COL area. Done! We packed up and moved from Los Angeles, CA to Savannah GA. Next, I used my new found capital to set up diversified investments and open an account with Vanguard. Third, we dedicated ourselves to working like crazy for these next three years to shore up our investments and ensure that we are 100% ready to take that plunge into early retirement.
We also set up additional income streams. We launched this blog, and have dedicated ourselves to updating content and marketing it whenever we can. I went back to my travel blog and updated the content, adding affiliate links and increasing the social media presence. Every little bit helps! Every cent we can make via blogging gets us one step closer to freedom (full disclosure, we haven’t really made anything blogging yet. But Partners in Fire is super new, so we are hoping to generate some income off it in the coming months!)
I also have my 401K account for additional income when I reach retirement age, a pension, a Real Estate Investment Trust (REIT), and a few individual stock holdings. These different types of holdings should ensure that we are well diversified and should provide dividend income when we are ready to stop working.
Not Your Plan
We get that not everyone owns a home in a high COA area, and not all those who do will make huge gains by selling. That’s why my path may not be your path. Don’t worry, there are tons of other ways! Check out this small list of personal finance bloggers to see their paths to fire. You can take what you like from each and start your own journey!
Downsize your 2080’s Path to Independence involves downsizing the amount of time spent working. Some paths are simply about finding that work/life balance! Check out how they do it here!
Fifty Week Vacation is investing in both the stock market and real estate to create short, medium and long-term cash to achieve FIRE. Read about their investment journey here!
Saving Sherpa is perusing FIRE by putting experience over luxury, not having kids, and saving 70% of his income w/o side hustles. Read more about his $26k/yr Boston lifestyle here!
Military Dollar is going to achieve Fire by taking advantage of the programs offered to members of the armed services and creating multiple streams of retirement income. Follow her journey and learn some additional awesome finance tips for service members here!
Tread Lightly Retire Early is going to reach Fire by living an eco-friendly life and cutting spending to maximize their savings rate while minimizing their carbon footprint. Find out how they help the planet while gaining independence here!
What’s your Path to Fire?
As you can see, there are lots of different ways to get to financial freedom. There isn’t a one size fits all approach. And these blogs I listed are just a small sample of the paths different folks are taking, there are thousands more out there. Hopefully you will get some ideas from these and other blogs about what will work for you.
What does your path to Fire include? Do any of these bloggers resonate with you? Is there a totally different path that I’m missing? Let me know in the comments!