With the rising popularity of FIRE movement, it is not surprising why more and more people are getting interested in knowing about the different ways how they can plan smart and be serious with being frugal. Thus, people look for as many resources as possible to guide them through the ultimate goal, which is to be able to retire the earliest possible.
Hands up if you want to retire early!
It’s probably safe to say that most of us, working people, wanted to eventually retire earlier than 65. That’s actually the of most workers now. In fact, in one study conducted back in 2013, it was found that the average retirement age was just under 65, and the average life expectancy was over 85, which means people need to ensure they have enough savings to last 20 more years after retirement.
But before we talk about the numbers, in an article published by CNBC, it says that according to the study conducted by economists from the University of Amsterdam in 2017, it was found that retiring early is actually beneficial to help a person live longer.
On the said study, the researchers explained that the potential reasons behind this are: First, retirement frees a person up from toxicity of work, which allows you to invest more time in your health, and then second, retirement can help alleviate work-related stress, which can lead to hypertension, a risk factor for various potentially serious conditions.
Unfortunately though, according to a report by the Boston College Center for Retirement Research, less than half of those who retire early do not have enough funds to sustain their standard of living. Now, that is where the problem arises.
Thus, if you want to retire early, at the same time, be able to sustain or maintain your standard of living, you really have to work hard and know your way how to be able to save up for what you will be needing from your retirement until demise.
With the FIRE movement in mind, we have come up with our list of books that are perfect resources to know your way towards being able to retire early, and ready. Yes, you got to be ready for the years ahead.
But before that, it allows us to share a little about what FIRE movement is all about in the first place.
WHAT IS THE FIRE MOVEMENT?
FIRE stands for “Financial Independence, Retire Early.” The goal of the FIRE is to save, at the same time, invest in a very aggressive way. The supposed savings and investment should be somewhere between 50-75% of your income. By doing so, you get to retire as early as within your 30s or 40s.
For some, you may be quite surprised with the amount of money needed to be set aside — but it is what it is.
Meanwhile, FIRE movement refers to the people around the country who believes that you must retire as early as possible — within the 30s or 40s as we mentioned.
While others think FIRE is unrealistic, well, guess what? There are actually people that are able to do just that!
To be able to reach the goal of setting aside 50% to 75% of income, people who belong in the FIRE movement are always doing two things — Keeping their expenses extremely low and raising their income. Basically, the general idea of FIRE is to aim for a higher income, but keeping the expenses low. By doing this, you will be able to reach financial independence as early as possible.
WHAT DOES THE FIRE MOVEMENT TEACH YOU?
As we mentioned earlier, for some people the concept of FIRE and the whole FIRE movement may be unrealistic for some given the current cost of living. However, if you come to think about it, it’s actually great! Nothing beats being able to retire early. It can surely keep you away from stress!
But really, what does the whole FIRE movement teaches us? What can we learn from it? Is it really achievable?
Well, here are some of the things that we learned from the FIRE movement – having studied it for a while now:
– FIRE movement teaches us to dream and plan for retirement.
We all need to plan and prepare for retirement. Unless of course, you want to work your whole life, right?
What we like about FIRE movement is that it encourages younger generations of workers to start thinking about retirement as young as they are. That the best time to start planning and working on your retirement is now. That the earlier you start setting aside money for your retirement, the better.
– FIRE movement teaches us to be very frugal.
The best way to save money is to be frugal. In fact, experts say that frugality is actually what makes FIRE work. You should not just be aggressive in saving money, but you also need to be very frugal.
Of course, realistically speaking, being frugal can be quite challenging especially for people with a middle-class income, but if you come to think about it, it’s not about how much you earn, but how you handle your money.
You can be frugal if you really want to. Otherwise, it’s really going to be tough. Of course, there are certain sacrifices and it entails a lot of planning, but at the end of the day, it’s going to be worth for sure. After all, no one else will benefit from all these but you and your family as well.
– FIRE movement teaches us to look for ways to earn more.
As they say, if you really want something, you got to work your way around to get it! In the case of retiring early or FIRE, it basically teaches you to be creative in making sure you hit the goal. And yes, being creative means, making ways to earn more!
When we say to earn more, it can be you are on a career path that will eventually lead you to earn a six-digit salary or you go find a side hustle where you can earn extra money to boost your savings or investments.
Whatever it is that may work for you, as long as you get to have additional income — it will surely help a lot to earn more and save more to be able to retire as early as possible.
– FIRE movement teaches us to make both saving and investing on top of our priorities.
The best way to plan and prepare for early retirement is to save and invest money. There are no questions asked, no ifs, and no buts.
If you belong in the FIRE movement, you will notice how radical people there are about throwing a huge amount of their monthly income toward their retirement fund.
While saving 50% may be big for you right now, but you know, to be honest, that’s totally fine. It does not matter if you can only set aside 10% of your income or 15%. The important thing is that you start somewhere. Eventually, when you are able, you can add more to your savings and investments.
Another thing, make it a habit. As long as you keep doing it on a regular basis, we swear, you will be surprised at how much you are able to save up — and who knows, without you knowing it, you are actually getting there already!
AMAZING FIRE BOOKS
You see, these are just some of the many things you get to learn from the FIRE movement. But as we have said earlier, at the end of the day, if the FIRE concept is too much for you to handle at the moment – given its requirements – the thing is, at least you start somewhere.
Before we talk about our list of FIRE books, we thought this video blog by Our Rich Journey is very insightful, and would highly recommend you check it on. Here, Christina and Armon talk about the nine things they did to be able to achieve financial independence, which is a very important factor in the FIRE movement. Click the play button below to watch and learn:
Now, going back, one way to start off being on FIRE (and we mean that literally and figuratively) is to read books that embrace or at least have the same FIRE movement concept.
Having said that, here are some of the books we found to be very helpful as you start your journey towards being on FIRE (and again, we mean that literally and figuratively):
The Millionaire Next Door
Authors: Thomas J. Stanley and William Danko
What comes into your mind when you think about someone wealthy? Someone who lives in a palace? An actress with a multimillion-dollar contract? The president of the United States?
Well, in this book, you will find out the concept of personal net worth, as well as how the authors calculated wealth.
When you read this book, you will find out that while an actress pulls in a seven-figure paycheck before taxes, the real, truly wealthy people rarely do.
You Need A Budget
Author: Jesse Mecham
This is by far one of the best books we found when it comes to financial independence and budgeting.
We like the fact that Mecham took all the roadblocks that are stopping people from budgeting their money — you know, the usual reasoning like not having enough or not having money at all, not knowing how much you earn, etc. — and then rendering them irrelevant with the author’s four rules.
The book basically helps you to break the paycheck to paycheck cycle and pay down debt.
Your Money or Your Life: 9 Steps To Transforming Your Relationship With Money And Achieving Financial Independence
Authors: Vicki Robin & Joe Dominguez
We bet your life will never be the same if you read the book. Okay, that may sound a little too much for some, but really. This book just teaches you a lot of things especially about handling money and becoming financially independent.
There is so much to love about the book. Some of our favorite chapters include the one about frugality (which is the very concept of FIRE movement), the four pillars of financial independence, the mindset, and of course, the step by step strategy on how to calculate the amount of money you are actually making on a per-hour basis.
We highly recommend reading this book not just for the newbies in financial topics, but even when you have so much learning already. It’s definitely worth reading.
Set For Life
Author: Scott Trench
If you have heard about Bigger Pockets, then you should know who Scott Trench, the author of the book is. For those who are not familiar, Bigger Pockets is a very popular real estate investing community in the country.
Anyway, Set for Life is a book wherein Trench walks you through a three phases approach when it comes to accelerating your financial independence. Financial independence, as you know is very much needed to be able to retire as early as possible, which is the very concept of FIRE movement.
Particularly, the book focuses on real estate as well as house hacking, which is not surprising since it is what Trench is really good at anyway. The author basically lays out a step by step plan for you to use strategically in real estate.
We actually find the book ideal for those people who are single and in their 20s or 30s. This is definitely worth reading especially for the younger generations.
The Simple Path To Wealth: Your Road Map To Financial Independence And A Rich, Free Life
Author: JL Collins
This book is ideal for those who want to know more about investing. It talks about the difference between 401k and a Roth IRA, a mutual fund, as well as an index fund, stocks, bonds, Ameritrade, etc.
In this book, Collins, as we have mentioned talks about investing, as well as offer the best and the clearest breakdown of all the various types, fees, and ways to invest. We told you if you are new to investing, this is definitely worth reading.
What we like about this book is that Collins made investing a very simple and easy topic to talk about. Furthermore, he did not only discuss what investing is, but he also tackled about why you should invest in the first place.
Remember in the FIRE movement – there are two major things that are important in order to be able to retire early. These are savings and investments.
Quit Like A Millionaire: No Gimmicks, Luck, or Trust Fund Required
Authors: Kristy Shen & Brice Leung
What we like about Quit Like A Millionaire is that it has so much life and color. Needless to say, the book was beautifully written.
The book will surely blow you away. Unlike other money-related books, this one will surely inspire you and more.
The books are a perfect balance of tactics, motivation, as well as a story. To be honest, the book was very entertaining. It’s like reading a friend’s blog or letter. You are going to laugh while reading, but you will also end up with a lot of realizations and learning. The book is very detailed. In fact, it comes with charts and graphs to help you better understand what the authors are trying to point out.
I Will Teach You To Be Rich
Author: Ramit Sethi
I Will Teach You To Be Rich is a true financial classic. The book will teach so much about making money, which is something really important if you want to retire early.
The book presents you with different mindsets that will change how you see and think about money. It will also make you realize money’s role in your life.
We like the fact that Sethi is a deep thinker, and that he presents a compelling case on how to best spend your money to be able to maximize happiness in your life.
If this helps, we like the fact that Sethi has this great way of making money very simple — because let’s admit it, money is very complicated in real life. But Sethi has this gift of making it look very simple. In this book, Sethi focuses a lot on income optimization, as well as in launching your own business, which actually makes it ideal for entrepreneurs or planning to be one.
Retire Early With Real Estate: How To Invest In Real Estate To Work Less And Do What Matters More
Author: Char Carson
Perhaps a lot of financially literate people, as well as financial experts, will agree with us if we say that real estate investing is one if not the fastest way towards financial independence.
If you also believe in that, then you should be reading this book!
The author of the book, Carson, is definitely one of the best guys to talk about real estate investing having invested in hundreds of properties and have reached financial independence when he was on his 30s (now that is what FIRE is all about).
There are plenty of real estate books out there. However, they are mostly focused on building insanely large portfolios or some would be about building a real estate empire. In this book, though, Carson focused on helping you retire early through real estate.
You will definitely learn a lot from this book like the difference between mindset and strategies. The book will also change how you see or think about buying an investment property. We highly recommend this to those who are interested in investing in real estate. This one will surely give you so many realizations and learning particularly about the industry.
The 4-Hour Workweek: Escape 9-5, Live Anywhere, And Join The New Rich
Author: Tim Ferriss
This is not a money book, but this is definitely worth reading especially if you are aiming to become a digital nomad.
The book is basically focused on entrepreneurship, as well as in making money anywhere, which makes it a FIRE book.
The book will teach you about automating your business, as well as how you can build a passive income lifestyle business.
Something we like about this book is that Ferriss created the idea of a “mini-retirement”. The author also teaches you to view your earning years as a series of phases, instead of seeing it as one long 9 to 5 grind.
We highly recommend this book for those who are interested in entrepreneurship, which is one of the easiest and quickest ways to achieve financial independence.
FINAL THOUGHTS ABOUT FIRE MOVEMENT
FIRE movement does actually have a great concept. It teaches us to become more responsible in planning and in working our way up to be able to retire as early as we could – and not merely rely on our jobs until we age.
Have you started preparing for your retirement yet? How is it going?
You know, what’s nice about this generation is that you have all the means to ensure you have a good retirement future. Things like the FIRE movement is definitely something to be thankful for as it helps us become more responsible retirees in the future.