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6 Common Misconceptions About F.I.R.E. (And Why It’s More Accessible Than You Think)

If you’ve been following our journey, even for a short time, then you probably know that we retired just before 40! We called our journey to early retirement “our F.I.R.E. journey” (or “our Finance Independence and Retiring Early journey”).

We’ve had so many people send us questions about our F.I.R.E. journey and how they can apply what we did to their lives. Some people understand the F.I.R.E. movement right away; others get it wrong.

So I’d like to delve into the nitty-gritty details of F.I.R.E. More specifically, I want to share some of the misconceptions and some of the things that people get wrong about the F.I.R.E. movement. Hopefully, this will give you a better understanding of what the F.I.R.E. movement is and it might even clarify some things!

What People Get Wrong About F.I.R.E.

Over the years, I’ve seen so many people talking about the F.I.R.E. movement, but Amon and I have been living it for almost two years! So not everyone truly understands the F.I.R.E. movement . . . but that’s okay! We’re here to share!

So let’s debunk a few misconceptions about F.I.R.E.

1. How People Live Off Their Investments

Look - the average person usually doesn’t understand how this works. And why would they be expected to? The average person isn’t taught about investing in school - so it makes sense that the average person wouldn’t know how to live off of his investments.

Here’s a fun exercise. Ask ten people how much money they think they’ll need to retire early. Chances are, they’re almost always going to answer in the multi-millions . . . without being able to adequately explain how they came up with that number.

For the most part, they don’t think of investments, the four percent rule, or how income is taxed when living off investments. People who are already F.I.R.E. (or aspire to it) understand how to support themselves by living off of their investments.

2. F.I.R.E. Is A Fad

Another common misconception is the idea that early retirement is a recent invention. This is pretty odd to me - because people have been living off their investments for as long as investments have existed.

Part of the reason this isn’t obvious is because people often don’t make it clear that they are financially independent. It’s only recently that people have begun to talk about it in the way we do now.

Because of that, talking about financial independence and early retirement can be confusing for people who often think we’re just following a new fad. F.I.R.E. isn’t a fad. It certainly isn’t new. It’s just been rebranded!

3. The Journey To F.I.R.E. Is A Miserable One