FIRE movement

The extreme lifestyle shift that promises financial independence and the ability to retire early. What could go wrong?

Younger generations looking ahead regretfully to a lifetime of work are finding a frugal – if not radical – alternative to slaving away. The 'FIRE' (financial independence, retire early) movement sees its adherents live as cheaply as possible in their 20s and 30s, squirreling enough money away to retire by middle age. These extreme savers are working longer hours to save up overtime payments while also spending less leisure time out of home to avoid costly activities.

Idealistically, FIRE is a positive movement that encourages financial stability: at present, UK millennials save on average 4.6% of their income for retirement. It’s “well short of current rules of thumb which suggest contributions of 12-15% of income are needed,” says Helen Morrisey, a pensions specialist at Royal London. But it also has its detractors: “it seems to me like the extreme version of the Atkins diet,” says financial planning adviser Damien Fahy. Cutting back on food, recreational costs and holidays while working all hours to build up a nest egg can cause burnout.

As life expectancies rise, so do debates about whether it’s even possible to save enough money for 50 years or more of retirement. Declining health, the need for social care and enough activities and entertainment to stave off the boredom of a half-century doing nothing all cost money. If you’re living frugally all your life, are you really living?

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Image credit: Piero Zagami and Michela Nicchiotti.