FIRE (Financial Independence, Retire Early) Model
A strategy aimed at achieving financial independence through aggressive savings and investments to retire earlier than the traditional age.
The FIRE model emphasizes living below your means, saving a significant portion of your income (often 50% or more), and investing wisely in assets that generate passive income. The core principles include: 1) Track your expenses and develop a budget; 2) Increase your income through side hustles or career advancement; 3) Invest in low-cost index funds or real estate; 4) Aim for a desirable withdrawal rate (commonly 4%) from your investment portfolio to sustain your lifestyle during retirement. By adhering to these principles, individuals can achieve financial independence and retire much earlier than the conventional retirement age.